Guidewire Software Announces Fourth Fiscal Quarter and Fiscal Year 2018 Financial Results
Guidewire Software, Inc. (NYSE: GWRE), a provider of software products to Property and Casualty (“P&C”) insurers, today
announced its financial results for the fourth fiscal quarter and year ended July 31, 2018.
“Driven by a record number of transactions at new and existing customers in both domestic and international markets, revenue and
net income were above our guidance ranges for the fourth quarter and fiscal year 2018,” said Marcus Ryu, chief executive officer,
Guidewire Software. “As insurers strive for differentiation through automation, digital engagement, predictive analytics, and
integration to insurtech partners, they increasingly seek cloud solutions that reduce IT complexity and risk. We enter fiscal 2019
well situated to continue Guidewire InsurancePlatform’s progress toward becoming the platform of choice for the $2 trillion P&C
insurance industry.”
Fiscal Year 2018 Financial Highlights
Revenue
- Total revenue for fiscal year 2018 was $661.1 million, an increase of 29% from fiscal year 2017.
License and other revenue for fiscal year 2018 was $315.8 million, an increase of 16% from fiscal year 2017. Services revenue was
$268.0 million, an increase of 54%, and maintenance revenue was $77.3 million, an increase of 13%.
- Rolling four-quarter recurring revenue was $381.3 million for the period ended July 31, 2018, an
increase of 17% compared to the same metric for the period ended July 31, 2017. With our transition to more
subscription-based contracts and our upcoming adoption of the new revenue standard, this metric becomes less indicative of our
revenue trends and will not be disclosed in future quarters.
Profitability
- GAAP loss from operations was $7.3 million for fiscal year 2018, compared with income of $26.6
million in fiscal year 2017.
- Non-GAAP income from operations was $109.7 million for fiscal year 2018, compared with $110.5 million
for fiscal year 2017.
- GAAP net loss was $19.7 million for fiscal year 2018, compared with net income of $21.2 million for
fiscal year 2017. GAAP net loss per share was $0.25 for fiscal year 2018, based on diluted weighted average shares outstanding of
77.7 million, compared to $0.28 net income per share for fiscal year 2017, based on diluted weighted average shares outstanding
of 75.3 million.
- Non-GAAP net income was $90.9 million for fiscal year 2018, compared to $78.8 million for fiscal year
2017. Non-GAAP net income per share was $1.14 for fiscal year 2018, based on diluted weighted average shares outstanding of 77.7
million, compared to $1.05 for fiscal year 2017, based on diluted weighted average shares outstanding of 75.3 million.
Fourth Fiscal Quarter 2018 Financial Highlights
Revenue
- Total revenue for the fourth quarter of fiscal year 2018 was $248.6 million, an increase of 37% from
the same quarter in fiscal year 2017. License and other revenue was $151.1 million, an increase of 38%; services revenue was
$77.0 million, an increase of 46%; and maintenance revenue was $20.5 million, an increase of 10%.
Profitability
- GAAP income from operations was $55.2 million for the fourth quarter of fiscal year 2018, compared
with $41.0 million in the comparable period in fiscal year 2017.
- Non-GAAP income from operations was $83.7 million for the fourth quarter of fiscal year 2018,
compared with $64.0 million in the comparable period in fiscal year 2017.
- GAAP net income was $83.4 million for the fourth quarter of fiscal year 2018, compared with $26.9
million for the comparable period in fiscal year 2017. GAAP net income per share was $1.02, based on diluted weighted average
shares outstanding of 82.2 million, compared with $0.36 for the comparable period in fiscal year 2017, based on diluted weighted
average shares outstanding of 75.8 million.
- Non-GAAP net income was $66.3 million for the fourth quarter of fiscal year 2018, compared with $44.8
million in the comparable period in fiscal year 2017. Non-GAAP net income per share was $0.81, based on diluted weighted average
shares outstanding of 82.2 million, compared with $0.59 in the comparable period in fiscal year 2017, based on diluted weighted
average shares outstanding of 75.8 million.
Liquidity
- The Company had $1.3 billion in cash, cash equivalents and investments at July 31, 2018,
compared with $687.8 million at July 31, 2017. The increase was primarily due to total net proceeds of $608.2 million
related to the public offering of our common stock and convertible notes and $140.5 million in cash generated from operations,
partially offset by the use of $130.1 million of cash in connection with our acquisition of Cyence.
Business Outlook
Guidewire is issuing the following outlook for the first fiscal quarter and fiscal year 2019 based on current expectations:
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(in $ millions, except per share outlook) |
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First Fiscal Quarter
2019
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Fiscal Year 2019 |
Revenue |
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159.0 |
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- |
163.0 |
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740.5 |
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- |
752.5 |
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License and other revenue |
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73.0 |
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- |
77.0 |
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365.0 |
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- |
377.0 |
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Maintenance revenue |
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19.0 |
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- |
20.0 |
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79.5 |
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- |
81.5 |
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Services revenue |
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65.0 |
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- |
68.0 |
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290.0 |
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- |
300.0 |
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GAAP operating loss |
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(17.0 |
) |
- |
(13.0 |
) |
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(27.8 |
) |
- |
(15.8 |
) |
Non-GAAP operating income |
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14.5 |
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- |
18.5 |
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104.5 |
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- |
116.5 |
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GAAP net loss |
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(12.6 |
) |
- |
(9.5 |
) |
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(19.5 |
) |
- |
(10.1 |
) |
GAAP net loss per share |
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(0.16 |
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- |
(0.12 |
) |
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(0.24 |
) |
- |
(0.13 |
) |
Non-GAAP net income |
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14.5 |
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- |
17.6 |
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94.8 |
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- |
104.3 |
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Non-GAAP net income per share |
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0.18 |
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- |
0.22 |
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1.15 |
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- |
1.26 |
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Conference Call Information
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What:
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Guidewire Software Fourth Fiscal Quarter and Fiscal Year 2018
Financial Results Conference Call |
When: |
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Wednesday, September 5, 2018 |
Time: |
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2:00 p.m. PT (5:00 p.m. ET) |
Live Call: |
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(866) 548-4713, Domestic |
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(323) 794-2093, International |
Replay: |
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(844) 512-2921, Passcode 7506545, Domestic |
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(412) 317-6671, Passcode 7506545, International |
Webcast: |
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http://ir.guidewire.com/ (live and replay)
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The webcast will be archived on Guidewire’s website (www.guidewire.com)
for a period of three months.
Non-GAAP Financial Measures
This press release contains the following non-GAAP financial measures: Non-GAAP operating income (loss), Non-GAAP net income
(loss), Non-GAAP income tax provision (benefit), and Non-GAAP net income (loss) per share. Non-GAAP operating income (loss)
excludes stock-based compensation and amortization of intangibles. 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 and the related tax effects of the non-GAAP adjustments. The estimated annual tax rates used in the business
outlook to compute GAAP and Non-GAAP net income exclude discrete items such as forecasted tax benefits related to stock-based
compensation and are impacted by the passage of the Tax Cuts and Jobs Act.
Guidewire believes that these non-GAAP financial measures 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 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 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 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 delivers the industry platform that P&C insurers rely upon to adapt and succeed in a time of accelerating change. We
provide the software, services, and partner ecosystem to enable our customers to run, differentiate, and grow their business. We
are privileged to serve more than 350 companies in 32 countries. 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, market
positioning and future investments. 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: the
market for our software may develop more slowly than expected or than it has in the past; quarterly and annual operating results
may fluctuate more than expected; seasonal and other variations related to our 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 services revenue produce lower gross margins than our license and
maintenance revenue; assertions by third parties that we violate their intellectual property rights could substantially harm our
business; we face intense competition in our market; weakened global economic conditions may adversely affect the P&C insurance
industry including the rate of information technology spending; our product development and sales cycles are lengthy; the risk of
losing key employees; changes in foreign exchange rates; general political or destabilizing events, including war, conflict or acts
of terrorism; 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.
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GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED BALANCE SHEETS
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(unaudited, in thousands) |
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July 31,
2018 |
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July 31,
2017 |
ASSETS |
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CURRENT ASSETS: |
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Cash and cash equivalents |
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$ |
437,140 |
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$ |
263,176 |
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Short-term investments |
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630,008 |
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310,027 |
|
Accounts receivable, net |
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124,849 |
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79,433 |
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Prepaid expenses and other current assets |
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30,510 |
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26,604 |
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Total current assets |
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1,222,507 |
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679,240 |
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Long-term investments |
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190,952 |
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114,585 |
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Property and equipment, net |
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18,595 |
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14,376 |
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Intangible assets, net |
|
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|
95,654 |
|
|
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|
71,315 |
|
Deferred tax assets, net |
|
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|
87,482 |
|
|
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|
37,430 |
|
Goodwill |
|
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|
340,877 |
|
|
|
|
141,851 |
|
Other assets |
|
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|
22,525 |
|
|
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|
20,104 |
|
TOTAL ASSETS |
|
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|
$ |
1,978,592 |
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|
$ |
1,078,901 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
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CURRENT LIABILITIES: |
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Accounts payable |
|
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$ |
30,635 |
|
|
|
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$ |
13,416 |
|
Accrued employee compensation |
|
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|
60,135 |
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48,882 |
|
Deferred revenue, current |
|
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114,138 |
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|
91,243 |
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Other current liabilities |
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|
20,280 |
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|
10,075 |
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Total current liabilities |
|
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225,188 |
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|
163,616 |
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Convertible senior notes, net |
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|
305,128 |
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— |
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Deferred revenue, non-current |
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23,758 |
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19,892 |
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Other liabilities |
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|
774 |
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|
2,112 |
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Total liabilities |
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554,848 |
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185,620 |
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STOCKHOLDERS’ EQUITY: |
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Common stock |
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8 |
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8 |
|
Additional paid-in capital |
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1,297,979 |
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830,014 |
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Accumulated other comprehensive loss |
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(7,748 |
) |
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(5,796 |
) |
Retained earnings |
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133,505 |
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69,055 |
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Total stockholders’ equity |
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1,423,744 |
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893,281 |
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
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$ |
1,978,592 |
|
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$ |
1,078,901 |
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GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF OPERATIONS |
(unaudited, in thousands except share and per share
data) |
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Three Months Ended July 31, |
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Year Ended July 31, |
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2018 |
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2017 |
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2018 |
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2017 |
Revenue: |
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|
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License and other |
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$ |
151,103 |
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$ |
109,695 |
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$ |
315,776 |
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$ |
271,462 |
|
Maintenance |
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20,548 |
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18,671 |
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77,337 |
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68,643 |
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Services |
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76,988 |
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52,734 |
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267,954 |
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174,179 |
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Total revenue |
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248,639 |
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181,100 |
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661,067 |
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514,284 |
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Cost of revenue: (1) |
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License and other |
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9,955 |
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6,627 |
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35,452 |
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17,046 |
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Maintenance |
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3,895 |
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|
3,513 |
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|
|
|
14,783 |
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|
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|
13,397 |
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Services |
|
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|
77,873 |
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|
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|
47,121 |
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|
246,472 |
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|
161,116 |
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Total cost of revenue |
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91,723 |
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57,261 |
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296,707 |
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191,559 |
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Gross profit: |
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License and other |
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141,148 |
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103,068 |
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280,324 |
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|
254,416 |
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Maintenance |
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16,653 |
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15,158 |
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62,554 |
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55,246 |
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Services |
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(885 |
) |
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5,613 |
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21,482 |
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13,063 |
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Total gross profit |
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156,916 |
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|
123,839 |
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364,360 |
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|
322,725 |
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Operating expenses: (1) |
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Research and development |
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45,502 |
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35,458 |
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|
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|
171,657 |
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|
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|
130,323 |
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Sales and marketing |
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|
38,168 |
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31,431 |
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|
124,117 |
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|
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|
109,239 |
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General and administrative |
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|
18,009 |
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|
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|
15,902 |
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|
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|
75,916 |
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|
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|
56,551 |
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Total operating expenses |
|
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|
101,679 |
|
|
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|
82,791 |
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|
371,690 |
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|
296,113 |
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Income (loss) from operations |
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|
55,237 |
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|
|
|
41,048 |
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(7,330 |
) |
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|
26,612 |
|
Interest income |
|
|
|
6,034 |
|
|
|
|
1,581 |
|
|
|
|
13,281 |
|
|
|
|
5,867 |
|
Interest expense |
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|
(4,203 |
) |
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|
(7 |
) |
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|
(6,442 |
) |
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|
(13 |
) |
Other income (expense), net |
|
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|
(531 |
) |
|
|
|
1,146 |
|
|
|
|
509 |
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|
|
|
811 |
|
Income before income taxes |
|
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|
56,537 |
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|
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|
43,768 |
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18 |
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|
33,277 |
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Provision for (benefit from) income taxes |
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(26,889 |
) |
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|
16,841 |
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|
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|
19,683 |
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|
|
|
12,053 |
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Net income (loss) |
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|
$ |
83,426 |
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$ |
26,927 |
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$ |
(19,665 |
) |
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$ |
21,224 |
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Net income (loss) per share: |
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Basic |
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$ |
1.04 |
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$ |
0.36 |
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|
$ |
(0.25 |
) |
|
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$ |
0.29 |
|
Diluted |
|
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|
$ |
1.02 |
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$ |
0.36 |
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|
$ |
(0.25 |
) |
|
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$ |
0.28 |
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Shares used in computing net income (loss) per share: |
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Basic |
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|
80,433,450 |
|
|
|
|
74,776,333 |
|
|
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|
77,709,592 |
|
|
|
|
73,994,577 |
|
Diluted |
|
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|
82,162,624 |
|
|
|
|
75,769,530 |
|
|
|
|
77,709,592 |
|
|
|
|
75,328,343 |
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(1) Amounts include stock-based compensation expense as follows:
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Three Months Ended July 31, |
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Year Ended July 31, |
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|
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
|
(unaudited, in thousands) |
Stock-based compensation expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of license and other revenue |
|
|
|
$ |
296 |
|
|
|
|
$ |
142 |
|
|
|
|
$ |
1,002 |
|
|
|
|
$ |
373 |
Cost of maintenance revenue |
|
|
|
488 |
|
|
|
|
429 |
|
|
|
|
1,886 |
|
|
|
|
1,694 |
Cost of services revenue |
|
|
|
5,874 |
|
|
|
|
4,652 |
|
|
|
|
21,856 |
|
|
|
|
18,621 |
Research and development |
|
|
|
5,595 |
|
|
|
|
4,498 |
|
|
|
|
25,440 |
|
|
|
|
18,123 |
Sales and marketing
|
|
|
|
4,619 |
|
|
|
|
4,166 |
|
|
|
|
18,387 |
|
|
|
|
16,664 |
General and administrative |
|
|
|
4,248 |
|
|
|
|
4,246 |
|
|
|
|
21,043 |
|
|
|
|
16,319 |
Total stock-based compensation expense |
|
|
|
$ |
21,120 |
|
|
|
|
$ |
18,133 |
|
|
|
|
$ |
89,614 |
|
|
|
|
$ |
71,794 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
(unaudited, in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
July 31,
|
|
|
|
Year Ended July 31,
|
|
|
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
|
|
$ |
83,426 |
|
|
|
|
$ |
26,927 |
|
|
|
|
$ |
(19,665 |
) |
|
|
|
$ |
21,224 |
|
Adjustments to reconcile net income (loss) to net cash provided by operating
activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
|
9,494 |
|
|
|
|
6,517 |
|
|
|
|
35,611 |
|
|
|
|
18,725 |
|
Amortization of debt discount and issuance costs |
|
|
|
2,944 |
|
|
|
|
— |
|
|
|
|
4,512 |
|
|
|
|
— |
|
Provision for doubtful accounts |
|
|
|
1,062 |
|
|
|
|
— |
|
|
|
|
1,062 |
|
|
|
|
— |
|
Stock-based compensation |
|
|
|
21,120 |
|
|
|
|
18,133 |
|
|
|
|
89,614 |
|
|
|
|
71,794 |
|
Excess tax benefit from stock-based compensation |
|
|
|
— |
|
|
|
|
(10,029 |
) |
|
|
|
— |
|
|
|
|
(9,067 |
) |
Deferred income tax |
|
|
|
(28,085 |
) |
|
|
|
5,552 |
|
|
|
|
15,336 |
|
|
|
|
(1,227 |
) |
Amortization of premium on available-for-sale securities, and other non-cash
items |
|
|
|
(1,384 |
) |
|
|
|
261 |
|
|
|
|
(1,418 |
) |
|
|
|
1,462 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
|
(24,023 |
) |
|
|
|
15,995 |
|
|
|
|
(40,832 |
) |
|
|
|
(9,750 |
) |
Prepaid expenses and other assets |
|
|
|
(811 |
) |
|
|
|
(2,291 |
) |
|
|
|
(2,783 |
) |
|
|
|
(9,463 |
) |
Accounts payable |
|
|
|
10,248 |
|
|
|
|
765 |
|
|
|
|
16,792 |
|
|
|
|
1,311 |
|
Accrued employee compensation |
|
|
|
16,684 |
|
|
|
|
10,727 |
|
|
|
|
9,230 |
|
|
|
|
7,138 |
|
Other liabilities |
|
|
|
7,973 |
|
|
|
|
9,296 |
|
|
|
|
8,859 |
|
|
|
|
8,211 |
|
Deferred revenue |
|
|
|
3,437 |
|
|
|
|
3,770 |
|
|
|
|
24,140 |
|
|
|
|
36,802 |
|
Net cash provided by operating activities |
|
|
|
102,085 |
|
|
|
|
85,623 |
|
|
|
|
140,458 |
|
|
|
|
137,160 |
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of available-for-sale securities |
|
|
|
(324,347 |
) |
|
|
|
(118,274 |
) |
|
|
|
(859,657 |
) |
|
|
|
(462,035 |
) |
Sales of available-for-sale securities |
|
|
|
187,457 |
|
|
|
|
104,800 |
|
|
|
|
464,143 |
|
|
|
|
547,630 |
|
Purchases of property and equipment |
|
|
|
(2,712 |
) |
|
|
|
(2,650 |
) |
|
|
|
(9,398 |
) |
|
|
|
(5,886 |
) |
Capitalized software development costs |
|
|
|
(981 |
) |
|
|
|
(410 |
) |
|
|
|
(2,613 |
) |
|
|
|
(784 |
) |
Strategic investment |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
— |
|
|
|
|
(4,677 |
) |
Acquisitions of business, net of acquired cash |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
(130,058 |
) |
|
|
|
(187,590 |
) |
Net cash used in investing activities |
|
|
|
(140,583 |
) |
|
|
|
(16,534 |
) |
|
|
|
(537,583 |
) |
|
|
|
(113,342 |
) |
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of convertible senior notes, net of issuance costs |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
387,239 |
|
|
|
|
— |
|
Proceeds from issuance of common stock, net of issuance costs |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
220,948 |
|
|
|
|
— |
|
Purchase of capped calls |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
(37,200 |
) |
|
|
|
— |
|
Proceeds from issuance of common stock upon exercise of stock options |
|
|
|
958 |
|
|
|
|
2,144 |
|
|
|
|
2,013 |
|
|
|
|
5,563 |
|
Excess tax benefit from exercise of stock options and vesting of restricted
stock units |
|
|
|
— |
|
|
|
|
10,029 |
|
|
|
|
— |
|
|
|
|
9,067 |
|
Net cash provided by financing activities |
|
|
|
958 |
|
|
|
|
12,173 |
|
|
|
|
573,000 |
|
|
|
|
14,630 |
|
Effect of foreign exchange rate changes on cash and cash equivalents |
|
|
|
(1,421 |
) |
|
|
|
1,748 |
|
|
|
|
(1,911 |
) |
|
|
|
1,146 |
|
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS |
|
|
|
(38,961 |
) |
|
|
|
83,010 |
|
|
|
|
173,964 |
|
|
|
|
39,594 |
|
CASH AND CASH EQUIVALENTS—Beginning of period |
|
|
|
476,101 |
|
|
|
|
180,166 |
|
|
|
|
263,176 |
|
|
|
|
223,582 |
|
CASH AND CASH EQUIVALENTS—End of period |
|
|
|
$ |
437,140 |
|
|
|
|
$ |
263,176 |
|
|
|
|
$ |
437,140 |
|
|
|
|
$ |
263,176 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES |
Reconciliation of GAAP to Non-GAAP Financial
Measures |
(unaudited, in thousands except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 July 31, |
|
|
|
Year Ended July 31, |
|
|
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
Income (loss) from operations reconciliation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP income (loss) from operations |
|
|
|
$ |
55,237 |
|
|
|
|
$ |
41,048 |
|
|
|
|
$ |
(7,330 |
) |
|
|
|
$ |
26,612 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1) |
|
|
|
21,120 |
|
|
|
|
18,133 |
|
|
|
|
89,614 |
|
|
|
|
71,794 |
|
Amortization of intangibles (1) |
|
|
|
7,348 |
|
|
|
|
4,776 |
|
|
|
|
27,462 |
|
|
|
|
12,089 |
|
Non-GAAP income from operations |
|
|
|
$ |
83,705 |
|
|
|
|
$ |
63,957 |
|
|
|
|
$ |
109,746 |
|
|
|
|
$ |
110,495 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) reconciliation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income (loss) |
|
|
|
$ |
83,426 |
|
|
|
|
$ |
26,927 |
|
|
|
|
$ |
(19,665 |
) |
|
|
|
$ |
21,224 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1) |
|
|
|
21,120 |
|
|
|
|
18,133 |
|
|
|
|
89,614 |
|
|
|
|
71,794 |
|
Amortization of intangibles (1) |
|
|
|
7,348 |
|
|
|
|
4,776 |
|
|
|
|
27,462 |
|
|
|
|
12,089 |
|
Amortization of debt discount and issuance costs (2) |
|
|
|
2,944 |
|
|
|
|
— |
|
|
|
|
4,512 |
|
|
|
|
— |
|
Tax impact of non-GAAP adjustments (3) |
|
|
|
(48,548 |
) |
|
|
|
(5,080 |
) |
|
|
|
(11,006 |
) |
|
|
|
(26,323 |
) |
Non-GAAP net income |
|
|
|
$ |
66,290 |
|
|
|
|
$ |
44,756 |
|
|
|
|
$ |
90,917 |
|
|
|
|
$ |
78,784 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax provision (benefit) reconciliation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP tax provision (benefit) |
|
|
|
$ |
(26,889 |
) |
|
|
|
$ |
16,841 |
|
|
|
|
$ |
19,683 |
|
|
|
|
$ |
12,053 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1) |
|
|
|
4,820 |
|
|
|
|
5,973 |
|
|
|
|
24,481 |
|
|
|
|
23,145 |
|
Amortization of intangibles (1) |
|
|
|
2,369 |
|
|
|
|
1,573 |
|
|
|
|
8,085 |
|
|
|
|
3,913 |
|
Amortization of debt discount and issuance costs (2) |
|
|
|
902 |
|
|
|
|
— |
|
|
|
|
1,328 |
|
|
|
|
— |
|
Other income tax effects and adjustments (3) |
|
|
|
40,457 |
|
|
|
|
(2,466 |
) |
|
|
|
(22,888 |
) |
|
|
|
(735 |
) |
Non-GAAP tax provision |
|
|
|
$ |
21,659 |
|
|
|
|
$ |
21,921 |
|
|
|
|
$ |
30,689 |
|
|
|
|
$ |
38,376 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share reconciliation: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income (loss) per share - Diluted |
|
|
|
$ |
1.02 |
|
|
|
|
$ |
0.36 |
|
|
|
|
$ |
(0.25 |
) |
|
|
|
$ |
0.28 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1) |
|
|
|
0.26 |
|
|
|
|
0.24 |
|
|
|
|
1.15 |
|
|
|
|
0.96 |
|
Amortization of intangibles (1) |
|
|
|
0.09 |
|
|
|
|
0.06 |
|
|
|
|
0.35 |
|
|
|
|
0.16 |
|
Amortization of debt discount and issuance costs (2) |
|
|
|
0.04 |
|
|
|
|
— |
|
|
|
|
0.06 |
|
|
|
|
— |
|
Tax impact of non-GAAP adjustments (3) |
|
|
|
(0.60 |
) |
|
|
|
(0.07 |
) |
|
|
|
(0.14 |
) |
|
|
|
(0.35 |
) |
Non-GAAP dilutive shares excluded from GAAP net income (loss) per share
calculation (4) |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
(0.03 |
) |
|
|
|
— |
|
Non-GAAP net income per share - Diluted |
|
|
|
$ |
0.81 |
|
|
|
|
$ |
0.59 |
|
|
|
|
$ |
1.14 |
|
|
|
|
$ |
1.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in computing Non-GAAP income per share amounts: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP weighted average shares - Diluted |
|
|
|
82,162,624 |
|
|
|
|
75,769,530 |
|
|
|
|
77,709,592 |
|
|
|
|
75,328,343 |
|
Non-GAAP dilutive shares excluded from GAAP loss per share calculation
(4) |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
1,785,533 |
|
|
|
|
— |
|
Pro forma weighted average shares - Diluted |
|
|
|
82,162,624 |
|
|
|
|
75,769,530 |
|
|
|
|
79,495,125 |
|
|
|
|
75,328,343 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Adjustments relate to amortization of acquired intangibles and stock-based compensation recognized during the period for
GAAP purposes.
(2) Adjustments reflect the amortization of debt discount and issuance costs related to the issuance of our Senior Convertible
Notes recognized during the period for GAAP purposes.
(3) Adjustments reflect the tax benefit (provision) resulting from all non-GAAP adjustments.
(4) Due to the occurrence of a net loss on a GAAP basis, potentially dilutive securities were excluded from the calculation of GAAP
income (loss) per share, as they would have had an anti-dilutive effect. However, as net income was earned on a non-GAAP basis,
these shares have a dilutive effect on Non-GAAP income (loss) per share.
|
GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES |
Reconciliation of GAAP to Non-GAAP Outlook |
The following tables reconcile the specific items excluded from GAAP in
the calculation of non-GAAP outlook for the periods indicated below: |
(in $ millions) |
|
|
|
First Fiscal
Quarter 2019
|
|
|
|
Fiscal Year 2019 |
Operating income (loss) outlook reconciliation: |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating loss |
|
|
|
(17.0 |
) |
- |
(13.0 |
) |
|
|
|
(27.8 |
) |
- |
(15.8 |
) |
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation |
|
|
|
23.7 |
|
- |
24.7 |
|
|
|
|
101.7 |
|
- |
104.7 |
|
Amortization of intangibles |
|
|
|
7.1 |
|
- |
7.6 |
|
|
|
|
28.6 |
|
- |
29.6 |
|
Non-GAAP operating income |
|
|
|
14.5 |
|
- |
18.5 |
|
|
|
|
104.5 |
|
- |
116.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) outlook reconciliation |
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net loss |
|
|
|
(12.6 |
) |
- |
(9.5 |
) |
|
|
|
(19.5 |
) |
- |
(10.1 |
) |
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation |
|
|
|
23.7 |
|
- |
24.7 |
|
|
|
|
101.7 |
|
- |
104.7 |
|
Amortization of intangibles |
|
|
|
7.1 |
|
- |
7.6 |
|
|
|
|
28.6 |
|
- |
29.6 |
|
Amortization of debt discount and issuance costs |
|
|
|
3.0 |
|
- |
3.0 |
|
|
|
|
12.2 |
|
- |
12.2 |
|
Tax impact of non-GAAP adjustments |
|
|
|
(7.4 |
) |
- |
(7.3 |
) |
|
|
|
(30.3 |
) |
- |
(30.1 |
) |
Non-GAAP net income |
|
|
|
14.5 |
|
- |
17.6 |
|
|
|
|
94.8 |
|
- |
104.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Media Contact:
Guidewire Software, Inc.
Diana Stott, 650-356-4941
dstott@guidewire.com
or
Investor Contact:
ICR, LLC
Garo Toomajanian, 650-357-5282
ir@guidewire.com
View source version on businesswire.com: https://www.businesswire.com/news/home/20180905005889/en/