December 3, 2025 – Guidewire Software Inc. (NYSE: GWRE) has announced impressive financial results for the first quarter of its fiscal year 2026, demonstrating robust performance and growth in its cloud-based offerings. The company's results exceeded expectations, prompting a positive revision of their fiscal outlook for the year.

1. Strong Start to Fiscal Year 2026

Mike Rosenbaum, CEO of Guidewire, expressed enthusiasm regarding the company’s ongoing momentum, particularly in relation to the Guidewire Cloud Platform. He highlighted the successful launch of new pricing and underwriting products at the recent annual customer conference, Connections, which focus on delivering advanced intelligence and AI-powered automation for property and casualty (P&C) insurers.

Jeff Cooper, CFO of Guidewire, reinforced this optimism by noting that the first quarter results surpassed the high end of the company's outlook across all metrics. He reported an impressive annual recurring revenue (ARR) growth of 22% year-over-year, showcasing the strong sales momentum the company has established.

2. First Quarter Fiscal Year 2026 Financial Highlights

Revenue Growth

For the first quarter ending October 31, 2025, Guidewire reported total revenue of $332.6 million, a significant 27% increase from the same period in the previous fiscal year. Breakdown of the revenue streams is as follows:

Subscription and Support Revenue: $222.2 million (an increase of 31% year-over-year)

License Revenue: $42.0 million (an increase of 12%)

Services Revenue: $68.5 million (an increase of 23%)

As of October 31, 2025, the company’s ARR reached $1,063 million, up from $1,041 million as of July 31, 2025. This growth reflects consistent gains in the company’s cloud-based services.

Profitability Metrics

Guidewire also reported a marked improvement in profitability:

GAAP Income from Operations: $18.5 million, a turnaround from a loss of $4.7 million in Q1 FY 2025.

Non-GAAP Income from Operations: $63.4 million, up from $34.7 million in the prior year.

GAAP Net Income: $31.3 million, compared to $9.1 million for the same quarter last year.

GAAP Diluted Net Income per Share: $0.36, based on 86.5 million diluted weighted average shares outstanding, compared to $0.11 per share in Q1 FY 2025.

Non-GAAP net income also showed substantial growth, reaching $57.0 million, resulting in a non-GAAP diluted net income per share of $0.66.

Liquidity and Capital Resources

As of the end of the first quarter, Guidewire held $1,409.3 million in cash, cash equivalents, and investments, a decrease from $1,483.2 million reported at the end of the previous quarter.

3. Updated Business Outlook

In light of the strong performance, Guidewire provided updated guidance for both the second quarter and the full fiscal year 2026:

Second Quarter Fiscal Year 2026 Outlook

Ending ARR: Expected to be between $1,107 million and $1,113 million

Total Revenue: Projected between $339 million and $345 million

GAAP Operating Income: Anticipated between $19 million and $25 million

Non-GAAP Operating Income: Expected between $68 million and $74 million

Full Fiscal Year 2026 Outlook

Ending ARR: Estimated between $1,220 million and $1,230 million

Total Revenue: Forecasted between $1,403 million and $1,419 million

GAAP Operating Income: Anticipated between $72 million and $88 million

Non-GAAP Operating Income: Expected between $266 million and $282 million

Operating Cash Flow: Forecasted between $355 million and $375 million

4. Conclusion

Guidewire Software Inc. has demonstrated a strong start to fiscal year 2026, with significant revenue growth and profitability improvements. The company's strategic focus on cloud services and AI-driven solutions for P&C insurers appears to be yielding positive results, positioning Guidewire well for continued success in the competitive landscape of insurance technology.

For those interested in a deeper dive, Guidewire will host a conference call on December 3, 2025, at 2:00 p.m. PT, providing further insights into the quarterly results and future strategies.

Original press release