Guidewire Software demonstrated strong performance in Q1 FY2026, exceeding outlook on all metrics and raising full-year guidance, driven by significant ARR growth and cloud platform momentum.
Total revenue increased 27% year-over-year to $332.6 million.
positiveAnnual Recurring Revenue (ARR) grew 22% year-over-year to $1,063 million.
positiveGAAP income from operations turned positive at $18.5 million, compared to a loss of $4.7 million in the prior year.
positiveNon-GAAP income from operations increased 83% year-over-year to $63.4 million.
positiveGAAP diluted EPS was $0.36, a significant increase from $0.11 in the prior year.
positiveNon-GAAP diluted EPS was $0.66, up from $0.43 in the prior year.
positiveFree cash flow was negative $(77.4) million for the quarter, a deterioration from $(67.4) million in the prior year.
negativeServices revenue, while growing 23% YoY, has a significantly lower gross margin (14.5%) compared to subscription and support (71.2%) and license (98.5%).
attentionCash, cash equivalents, and investments decreased by $83.9 million from July 31, 2025, to October 31, 2025.
attentionMargin expansion indicates improving profitability and operational efficiency. Measured in basis points (bps): 100 bps = 1.0%.
Forward-looking guidance is subject to change and does not constitute a guarantee. Actual results may differ materially from these estimates.
Guidewire Cloud Platform is showing strong momentum, with new pricing and underwriting products launched at Connections conference.
The company is off to a great start to the fiscal year, exceeding outlook on all metrics.
Confidence in raising full-year outlook is informed by strong Q1 results and sales momentum.
Commentary excerpts from earnings call transcripts provide management's perspective on performance, strategy, and outlook. Always review full transcripts for complete context.
Operational metrics provide insight into business drivers and customer engagement beyond traditional financial measures.