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Guidewire Software Announces Second Quarter Fiscal Year 2021 Financial Results

SAN MATEO, Calif.–(BUSINESS WIRE)–Guidewire Software, Inc. (NYSE: GWRE), the platform Property and Casualty (“P&C”) insurers trust to engage, innovate, and grow efficiently, today announced its financial results for the fiscal quarter ended January 31, 2021.

“We experienced strong sales activity in the quarter across our core, cloud and analytics offerings, highlighted by a new Tier 1 customer in Europe,” said Mike Rosenbaum, chief executive officer, Guidewire Software. “We also closed six cloud deals, five for InsuranceSuite and one for InsuranceNow, along with five standalone wins for our data and analytics solutions.”

Second Quarter Fiscal Year 2021 Financial Highlights

Revenue

  • Total revenue for the second quarter of fiscal year 2021 was $180.1 million, an increase of 4% from the same quarter in fiscal year 2020. Subscription and support revenue was $59.6 million, an increase of 20%; license revenue was $77.9 million, an increase of 2%; and services revenue was $42.6 million, a decrease of 10%.
  • Annual recurring revenue, or ARR, was $520 million as of January 31, 2021, compared to $514 million as of July 31, 2020. ARR results for interim quarterly periods in fiscal year 2021 are based on currency exchange rates at the end of fiscal year 2020, held constant throughout the year.

Profitability

  • GAAP loss from operations was $27.1 million for the second quarter of fiscal year 2021, compared with $18.0 million for the comparable period in fiscal year 2020.
  • Non-GAAP income from operations was $7.5 million for the second quarter of fiscal year 2021, compared with $15.4 million for the comparable period in fiscal year 2020.
  • GAAP net loss was $8.7 million for the second quarter of fiscal year 2021, compared with $19.9 million for the comparable period in fiscal year 2020. GAAP net loss per share was $0.10, based on diluted weighted average shares outstanding of 83.8 million, compared with $0.24 for the comparable period in fiscal year 2020, based on diluted weighted average shares outstanding of 82.7 million.
  • Non-GAAP net income was $9.0 million for the second quarter of fiscal year 2021, compared with $17.6 million for the comparable period in fiscal year 2020. Non-GAAP net income per share was $0.11, based on diluted weighted average shares outstanding of 84.8 million, compared with $0.21 for the comparable period in fiscal year 2020, based on diluted weighted average shares outstanding of 83.6 million.

Liquidity

  • The Company had $1.4 billion in cash, cash equivalents, and investments at both January 31, 2021 and July 31, 2020. The Company used $2.4 million in cash from operations and had negative free cash flow of $12.8 million during the six months ended January 31, 2021.
  • The Company has used $42.7 million to repurchase shares of its common stock since July 31, 2020.

Business Outlook

Guidewire is issuing the following outlook for the third quarter of fiscal year 2021 based on current expectations:

  • ARR between $533 million and $536 million
  • Total revenue between $155 million and $159 million
  • Operating income (loss) between $(62) million and $(58) million
  • Non-GAAP operating income (loss) between $(29) million and $(25) million

Guidewire is issuing the following updated outlook for fiscal year 2021 based on current expectations:

  • ARR between $560 million and $571 million
  • Total revenue between $725 million and $733 million
  • Operating income (loss) between $(138) million and $(130) million
  • Non-GAAP operating income (loss) between $2 million and $10 million
  • Operating cash flow between $60 million and $70 million

Conference Call Information

What:

Guidewire Software Second Quarter Fiscal Year 2021 Financial Results Conference Call

When:

Thursday, March 4, 2021

Time:

2:00 p.m. PT (5:00 p.m. ET)

Live Call:

(877) 705-6003, Domestic

 

(201) 493-6725, International

Replay:

(844) 512-2921, Passcode 13716551, Domestic

 

(412) 317-6671, Passcode 13716551, International

Webcast:

http://ir.guidewire.com/ (live and replay)

The webcast will be archived on Guidewire’s website (www.guidewire.com) for a period of three months.

Non-GAAP Financial Measures and Other Metrics

This press release contains the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP income (loss) from operations, non-GAAP net income (loss), non-GAAP income tax provision (benefit), non-GAAP net income (loss) per share, and free cash flow. Non-GAAP gross profit and non-GAAP income (loss) from operations exclude stock-based compensation, amortization of intangibles, and COVID-19 Canada Emergency Wage Subsidy benefits. Non-GAAP net income (loss), non-GAAP income tax provision (benefit), and non-GAAP net income (loss) per share also exclude the amortization of debt discount and issuance costs from our convertible notes, changes in fair value of our strategic investments, and the related tax effects of the non-GAAP adjustments. Free cash flow consists of net cash flow provided by (used in) operating activities less cash used for purchases of property and equipment and capitalized software development costs. These Non-GAAP measures enable us to analyze our financial performance without the effects of certain non-cash items such as depreciation, amortization, stock-based compensation, and changes in fair value of strategic investments.

Annual recurring revenue (“ARR”) is used to identify the annualized recurring value of active customer contracts at the end of a reporting period. ARR includes the annualized recurring value of term licenses, subscription agreements, support contracts, and hosting agreements based on customer contracts, which may not be the same as the timing and amount of revenue recognized. All components of the licensing and other arrangements that are not expected to recur (primarily perpetual licenses and services) are excluded.

Guidewire believes that these non-GAAP financial measures and other metrics provide useful information to management and investors regarding certain financial and business trends relating to Guidewire’s financial condition and results of operations. The Company’s management uses these non-GAAP measures and other metrics to compare the Company’s performance to that of prior periods for trend analysis, for purposes of determining executive and senior management incentive compensation, and for budgeting and planning purposes. The Company believes that the use of these non-GAAP financial measures and other metrics provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other software companies, many of which present similar non-GAAP financial measures and other metrics to investors.

Management of the Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. Guidewire urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including the financial tables at the end of this press release, and not to rely on any single financial measure to evaluate the Company’s business.

About Guidewire Software

Guidewire is the platform P&C insurers trust to engage, innovate, and grow efficiently. We combine digital, core, analytics, and AI to deliver our platform as a cloud service. More than 400 insurers, from new ventures to the largest and most complex in the world, run on Guidewire.

As a partner to our customers, we continually evolve to enable their success. We are proud of our unparalleled implementation track record, with 1,000+ successful projects, supported by the largest R&D team and partner ecosystem in the industry. Our marketplace provides hundreds of applications that accelerate integration, localization, and innovation.

For more information, please visit www.guidewire.com and follow us on twitter: @Guidewire_PandC.

NOTE: For information about Guidewire’s trademarks, visit https://www.guidewire.com/legal-notices.

Cautionary Language Concerning Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding our financial outlook, future business momentum, customer interest in driving efficiencies, and future product development and releases related to Guidewire Cloud Platform. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Guidewire’s control. Guidewire’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, risks detailed in Guidewire’s most recent Forms 10-K and 10-Q filed with the Securities and Exchange Commission as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission. In particular, the following factors, among others, could cause results to differ materially from those expressed or implied by such forward-looking statements: quarterly and annual operating results may fluctuate more than expected; the impact of the COVID-19 pandemic on our employees and our business and the businesses of our customers, system integrator (“SI”) partners, and vendors; seasonal and other variations related to our customer agreements and related revenue recognition may cause significant fluctuations in our results of operations and cash flows; our reliance on sales to and renewals from a relatively small number of large customers for a substantial portion of our revenue; our ability to successfully manage any changes to our business model, including the transition of our products to cloud offerings and the costs related to cloud operations; our products or cloud-based services may experience data security breaches; we face intense competition in our market; our services revenue produces lower gross margins than our license, subscription and support revenue; our product development and sales cycles are lengthy and may be affected by factors outside of our control; changes in accounting guidance, such as revenue recognition, which have and may cause us to experience greater volatility in our quarterly and annual results; assertions by third parties that we violate their intellectual property rights could substantially harm our business; weakened global economic conditions may adversely affect the P&C insurance industry including the rate of information technology spending; general political or destabilizing events, including war, conflict or acts of terrorism; our ability to sell our products is highly dependent on the quality of our professional services and SI partners; the risk of losing key employees; the challenges of international operations, including changes in foreign exchange rates; and other risks and uncertainties. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Guidewire’s views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. Guidewire undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Guidewire’s views as of any date subsequent to the date of this press release.

 

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands)

 

 

 

 

 

January 31,
2021

 

July 31,
2020

ASSETS

 

 

 

CURRENT ASSETS:

 

 

 

Cash and cash equivalents

$

331,387

 

 

$

366,969

 

Short-term investments

814,845

 

 

766,527

 

Accounts receivable, net

92,581

 

 

114,242

 

Unbilled accounts receivable, net

81,591

 

 

49,491

 

Prepaid expenses and other current assets

48,560

 

 

45,989

 

Total current assets

1,368,964

 

 

1,343,218

 

Long-term investments

228,795

 

 

300,771

 

Unbilled accounts receivable, net

34,695

 

 

34,737

 

Property and equipment, net

73,130

 

 

65,235

 

Operating lease assets

103,706

 

 

103,797

 

Intangible assets, net

27,061

 

 

39,708

 

Goodwill

340,877

 

 

340,877

 

Deferred tax assets, net

122,659

 

 

101,565

 

Other assets

35,844

 

 

34,944

 

TOTAL ASSETS

$

2,335,731

 

 

$

2,364,852

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

CURRENT LIABILITIES:

 

 

 

Accounts payable

$

23,593

 

 

$

22,634

 

Accrued employee compensation

64,249

 

 

58,547

 

Deferred revenue, net

97,510

 

 

118,311

 

Other current liabilities

25,371

 

 

25,706

 

Total current liabilities

210,723

 

 

225,198

 

Lease liabilities

121,770

 

 

119,408

 

Convertible senior notes, net

336,922

 

 

330,208

 

Deferred revenue, net

11,075

 

 

14,685

 

Other liabilities

10,578

 

 

18,585

 

Total liabilities

691,068

 

 

708,084

 

STOCKHOLDERS’ EQUITY:

 

 

 

Common stock

8

 

 

8

 

Additional paid-in capital

1,559,473

 

 

1,499,050

 

Accumulated other comprehensive income (loss)

(5,023)

 

 

(5,246)

 

Retained earnings

90,205

 

 

162,956

 

Total stockholders’ equity

1,644,663

 

 

1,656,768

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$

2,335,731

 

 

$

2,364,852

 

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands except share and per share data)

 

 

 

 

 

 

 

 

 

Three Months Ended January 31,

 

Six Months Ended January 31,

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Revenue:

 

 

 

 

 

 

 

Subscription and support

$

59,563

 

 

 

$

49,550

 

 

 

$

117,529

 

 

 

$

98,581

 

 

License

77,912

 

 

 

76,520

 

 

 

143,195

 

 

 

130,883

 

 

Services

42,587

 

 

 

47,388

 

 

 

89,140

 

 

 

101,004

 

 

Total revenue

180,062

 

 

 

173,458

 

 

 

349,864

 

 

 

330,468

 

 

Cost of revenue(1):

 

 

 

 

 

 

 

Subscription and support

40,158

 

 

 

28,212

 

 

 

77,164

 

 

 

53,145

 

 

License

2,834

 

 

 

2,904

 

 

 

5,771

 

 

 

5,461

 

 

Services

48,910

 

 

 

52,480

 

 

 

99,934

 

 

 

105,846

 

 

Total cost of revenue

91,902

 

 

 

83,596

 

 

 

182,869

 

 

 

164,452

 

 

Gross profit:

 

 

 

 

 

 

 

Subscription and support

19,405

 

 

 

21,338

 

 

 

40,365

 

 

 

45,436

 

 

License

75,078

 

 

 

73,616

 

 

 

137,424

 

 

 

125,422

 

 

Services

(6,323

)

 

 

(5,092

)

 

 

(10,794

)

 

 

(4,842

)

 

Total gross profit

88,160

 

 

 

89,862

 

 

 

166,995

 

 

 

166,016

 

 

Operating expenses(1):

 

 

 

 

 

 

 

Research and development

53,194

 

 

 

49,954

 

 

 

105,809

 

 

 

96,450

 

 

Sales and marketing

39,216

 

 

 

37,339

 

 

 

75,860

 

 

 

70,355

 

 

General and administrative

22,820

 

 

 

20,599

 

 

 

44,000

 

 

 

41,838

 

 

Total operating expenses

115,230

 

 

 

107,892

 

 

 

225,669

 

 

 

208,643

 

 

Income (loss) from operations

(27,070

)

 

 

(18,030

)

 

 

(58,674

)

 

 

(42,627

)

 

Interest income

2,015

 

 

 

6,958

 

 

 

4,804

 

 

 

14,594

 

 

Interest expense

(4,651

)

 

 

(4,462

)

 

 

(9,271

)

 

 

(8,891

)

 

Other income (expense), net

6,805

 

 

 

(182

)

 

 

9,373

 

 

 

(433

)

 

Income (loss) before provision for (benefit from) income taxes

(22,901

)

 

 

(15,716

)

 

 

(53,768

)

 

 

(37,357

)

 

Provision for (benefit from) income taxes

(14,249

)

 

 

4,228

 

 

 

(24,926

)

 

 

(2,422

)

 

Net income (loss)

$

(8,652

)

 

 

$

(19,944

)

 

 

$

(28,842

)

 

 

$

(34,935

)

 

Net income (loss) per share:

 

 

 

 

 

 

 

Basic

$

(0.10

)

 

 

$

(0.24

)

 

 

$

(0.34

)

 

 

$

(0.42

)

 

Diluted

$

(0.10

)

 

 

$

(0.24

)

 

 

$

(0.34

)

 

 

$

(0.42

)

 

Shares used in computing net income (loss) per share:

 

 

 

 

 

 

 

Basic

83,830,624

 

 

 

82,725,641

 

 

 

83,737,889

 

 

 

82,543,267

 

 

Diluted

83,830,624

 

 

 

82,725,641

 

 

 

83,737,889

 

 

 

82,543,267

 

 

(1)Amounts include stock-based compensation expense as follows:

 

Three Months Ended January 31,

 

Six Months Ended January 31,

 

2021

 

 

2020

 

 

2021

 

 

2020

 

(unaudited, in thousands)

Stock-based compensation expense:

 

 

 

 

 

 

 

Cost of subscription and support revenue

$

2,954

 

 

 

$

1,886

 

 

 

$

5,556

 

 

 

$

3,519

 

Cost of license revenue

145

 

 

 

188

 

 

 

396

 

 

 

368

 

Cost of services revenue

5,578

 

 

 

5,469

 

 

 

11,121

 

 

 

10,801

 

Research and development

7,604

 

 

 

6,668

 

 

 

14,851

 

 

 

12,849

 

Sales and marketing

6,806

 

 

 

5,996

 

 

 

12,783

 

 

 

11,153

 

General and administrative

6,809

 

 

 

6,529

 

 

 

13,273

 

 

 

12,604

 

Total stock-based compensation expense

$

29,896

 

 

 

$

26,736

 

 

 

$

57,980

 

 

 

$

51,294

 

 

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

 

 

 

 

 

 

 

 

 

Three Months Ended January 31,

 

Six Months Ended January 31,

 

2021

 

 

2020

 

 

2021

 

 

2020

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

Net income (loss)

$

(8,652

)

 

 

$

(19,944

)

 

 

$

(28,842

)

 

 

$

(34,935

)

 

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

10,434

 

 

 

10,758

 

 

 

20,971

 

 

 

21,644

 

 

Amortization of debt discount and issuance costs

3,380

 

 

 

3,198

 

 

 

6,715

 

 

 

6,354

 

 

Stock-based compensation

29,896

 

 

 

26,736

 

 

 

57,980

 

 

 

51,294

 

 

Changes to allowance for credit losses and revenue reserves

161

 

 

 

521

 

 

 

118

 

 

 

878

 

 

Deferred income tax

(8,467

)

 

 

3,014

 

 

 

(20,294

)

 

 

(4,361

)

 

Amortization of premium (accretion of discount) on available-for-sale securities, net

1,738

 

 

 

(652

)

 

 

3,128

 

 

 

(2,012

)

 

Other non-cash items affecting net income (loss)

810

 

 

 

572

 

 

 

800

 

 

 

572

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Accounts receivable

(13,556

)

 

 

(22,308

)

 

 

22,368

 

 

 

36,259

 

 

Unbilled accounts receivable

(6,844

)

 

 

6,085

 

 

 

(32,058

)

 

 

(17,018

)

 

Prepaid expenses and other assets

1,601

 

 

 

(2,081

)

 

 

1,914

 

 

 

(3,527

)

 

Operating lease assets

4,672

 

 

 

2,153

 

 

 

91

 

 

 

4,493

 

 

Accounts payable

(2,114

)

 

 

(1,023

)

 

 

(4,312

)

 

 

(4,032

)

 

Accrued employee compensation

17,357

 

 

 

10,986

 

 

 

3,844

 

 

 

(28,794

)

 

Deferred revenue

(765

)

 

 

1,126

 

 

 

(24,411

)

 

 

(23,583

)

 

Lease liabilities

(4,103

)

 

 

(44

)

 

 

2,669

 

 

 

241

 

 

Other liabilities

(12,219

)

 

 

377

 

 

 

(13,059

)

 

 

(2,137

)

 

Net cash provided by (used in) operating activities

13,329

 

 

 

19,474

 

 

 

(2,378

)

 

 

1,336

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

Purchases of available-for-sale securities

(177,196

)

 

 

(194,641

)

 

 

(523,601

)

 

 

(601,403

)

 

Sales of available-for-sale securities

27,650

 

 

 

10,888

 

 

 

85,553

 

 

 

67,942

 

 

Maturities of available-for-sale securities

214,607

 

 

 

205,624

 

 

 

456,198

 

 

 

508,807

 

 

Purchases of property and equipment

(3,610

)

 

 

(1,629

)

 

 

(5,517

)

 

 

(11,254

)

 

Capitalized software development costs

(2,303

)

 

 

(864

)

 

 

(4,884

)

 

 

(2,210

)

 

Acquisition of strategic investments

 

 

 

 

 

 

(2,000

)

 

 

 

 

Net cash provided by (used in) investing activities

59,148

 

 

 

19,378

 

 

 

5,749

 

 

 

(38,118

)

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

Proceeds from issuance of common stock upon exercise of stock options

104

 

 

 

871

 

 

 

1,820

 

 

 

1,239

 

 

Repurchase and retirement of common stock

(37,679

)

 

 

 

 

 

(42,679

)

 

 

 

 

Net cash provided by (used in) financing activities

(37,575

)

 

 

871

 

 

 

(40,859

)

 

 

1,239

 

 

Effect of foreign exchange rate changes on cash and cash equivalents

2,649

 

 

 

(349

)

 

 

1,906

 

 

 

(95

)

 

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

37,551

 

 

 

39,374

 

 

 

(35,582

)

 

 

(35,638

)

 

CASH AND CASH EQUIVALENTS—Beginning of period

293,836

 

 

 

179,089

 

 

 

366,969

 

 

 

254,101

 

 

CASH AND CASH EQUIVALENTS—End of period

$

331,387

 

 

 

$

218,463

 

 

 

$

331,387

 

 

 

$

218,463

 

 

 

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

Reconciliation of GAAP to Non-GAAP Financial Measures

(unaudited, in thousands)

 

 

 

 

 

 

 

 

The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP financial measures for the periods indicated below:

 

Three Months Ended January 31,

 

Six Months Ended January 31,

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Gross profit reconciliation:

 

 

 

 

 

 

 

GAAP gross profit

$

88,160

 

 

 

$

89,862

 

 

 

$

166,995

 

 

 

$

166,016

 

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

Stock-based compensation

8,677

 

 

 

7,543

 

 

 

17,073

 

 

 

14,688

 

 

Amortization of intangibles

4,526

 

 

 

4,945

 

 

 

9,052

 

 

 

9,890

 

 

COVID-19 Canada Emergency Wage Subsidy benefit (1)

(968

)

 

 

 

 

 

(968

)

 

 

 

 

Non-GAAP gross profit

$

100,395

 

 

 

$

102,350

 

 

 

$

192,152

 

 

 

$

190,594

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations reconciliation:

 

 

 

 

 

 

 

GAAP income (loss) from operations

$

(27,070

)

 

 

$

(18,030

)

 

 

$

(58,674

)

 

 

$

(42,627

)

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

Stock-based compensation

29,896

 

 

 

26,736

 

 

 

57,980

 

 

 

51,294

 

 

Amortization of intangibles

6,323

 

 

 

6,742

 

 

 

12,646

 

 

 

13,909

 

 

COVID-19 Canada Emergency Wage Subsidy benefit (1)

(1,686

)

 

 

 

 

 

(1,686

)

 

 

 

 

Non-GAAP income (loss) from operations

$

7,463

 

 

 

$

15,448

 

 

 

$

10,266

 

 

 

$

22,576

 

 

 

 

 

 

 

 

 

 

Net income (loss) reconciliation:

 

 

 

 

 

 

 

GAAP net income (loss)

$

(8,652

)

 

 

$

(19,944

)

 

 

$

(28,842

)

 

 

$

(34,935

)

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

Stock-based compensation

29,896

 

 

 

26,736

 

 

 

57,980

 

 

 

51,294

 

 

Amortization of intangibles

6,323

 

 

 

6,742

 

 

 

12,646

 

 

 

13,909

 

 

Amortization of debt discount and issuance costs

3,379

 

 

 

3,198

 

 

 

6,714

 

 

 

6,354

 

 

COVID-19 Canada Emergency Wage Subsidy benefit (1)

(1,686

)

 

 

 

 

 

(1,686

)

 

 

 

 

Tax impact of non-GAAP adjustments (2)

(20,232

)

 

 

826

 

 

 

(23,375

)

 

 

(8,086

)

 

Non-GAAP net income (loss)

$

9,028

 

 

 

$

17,558

 

 

 

$

23,437

 

 

 

$

28,536

 

 

 

 

 

 

 

 

 

 

Tax provision (benefit) reconciliation:

 

 

 

 

 

 

 

GAAP tax provision (benefit)

$

(14,249

)

 

 

$

4,228

 

 

 

$

(24,926

)

 

 

$

(2,422

)

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

Stock-based compensation

8,138

 

 

 

4,329

 

 

 

(14,153

)

 

 

8,529

 

 

Amortization of intangibles

1,721

 

 

 

1,092

 

 

 

(3,298

)

 

 

2,319

 

 

Amortization of debt discount and issuance costs

920

 

 

 

518

 

 

 

(1,727

)

 

 

1,058

 

 

COVID-19 Canada Emergency Wage Subsidy benefit (1)

(459

)

 

 

 

 

 

(459

)

 

 

 

 

Tax impact of non-GAAP adjustments (2)

9,912

 

 

 

(6,765

)

 

 

43,012

 

 

 

(3,820

)

 

Non-GAAP tax provision (benefit)

$

5,983

 

 

 

$

3,402

 

 

 

$

(1,551

)

 

 

$

5,664

 

 

(1) Effective the second fiscal quarter of 2021, the COVID-19 Canada Emergency Wage Subsidy benefit was included as a non-GAAP adjustment.

(2) Adjustments reflect the tax benefit (provision) resulting from all non-GAAP adjustments.

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

Reconciliation of GAAP to Non-GAAP Financial Measures

(unaudited, in thousands except per share amounts)

 

 

 

 

 

 

 

 

The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP financial measures for the periods indicated below:

 

Three Months Ended January 31,

 

Six Months Ended January 31,

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

Net income (loss) per share reconciliation:

 

 

 

 

 

 

 

GAAP net income (loss) per share — diluted

$

(0.10

)

 

 

$

(0.24

)

 

 

$

(0.34

)

 

 

$

(0.42

)

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

Stock-based compensation

0.36

 

 

 

0.32

 

 

 

0.70

 

 

 

0.62

 

 

Amortization of intangibles

0.08

 

 

 

0.08

 

 

 

0.16

 

 

 

0.17

 

 

Amortization of debt discount and issuance costs

0.04

 

 

 

0.04

 

 

 

0.08

 

 

 

0.08

 

 

COVID-19 Canada Emergency Wage Subsidy benefit (1)

(0.02

)

 

 

 

 

 

(0.02

)

 

 

 

 

Tax impact of non-GAAP adjustments (1)

(0.24

)

 

 

0.01

 

 

 

(0.28

)

 

 

(0.10

)

 

Non-GAAP dilutive shares excluded from GAAP net income (loss) per share calculation (2)

(0.01

)

 

 

 

 

 

(0.02

)

 

 

(0.01

)

 

Non-GAAP net income (loss) per share — diluted

$

0.11

 

 

 

$

0.21

 

 

 

$

0.28

 

 

 

$

0.34

 

 

 

 

 

 

 

 

 

 

Shares used in computing Non-GAAP income (loss) per share amounts:

 

 

 

 

 

 

 

GAAP weighted average shares — diluted

83,830,624

 

 

 

82,725,641

 

 

 

83,737,889

 

 

 

82,543,267

 

 

Non-GAAP dilutive shares excluded from GAAP income (loss) per share calculation (2)

1,007,573

 

 

 

842,001

 

 

 

859,492

 

 

 

854,608

 

 

Pro forma weighted average shares — diluted

84,838,197

 

 

 

83,567,642

 

 

 

84,597,381

 

 

 

83,397,875

 

 

Contacts

Investor Contact:
Alex Hughes

Guidewire Software, Inc.

(650) 356-4921

ir@guidewire.com

Media Contact:
Diana Stott

Guidewire Software, Inc.

(650) 356-4941

dstott@guidewire.com

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