Q4 2024 Guidewire Software Inc Earnings Call Transcript
Key Points
- Guidewire Software Inc (GWRE) reported strong ARR growth of 14% year-over-year, with fully ramped ARR accelerating to 19%.
- The company closed 16 cloud deals in the quarter and 42 for the year, indicating strong market momentum.
- Subscription and support gross margins increased by 10 percentage points to over 65% for the year, demonstrating greater scale and efficiency.
- Guidewire Software Inc (GWRE) generated nearly $100 million in non-GAAP operating profit and nearly $200 million in operating cash flow.
- The company expects to be GAAP profitable in fiscal 2025, reflecting the strength and efficiency of its Software-as-a-Service business model.
- Services revenue declined by 14% year-over-year as the company transitioned more implementation work to SI partners.
- License revenue was down 6% year-over-year due to the migration of on-premise customers to the cloud.
- The company faces ongoing competition in the market, requiring continuous effort to win deals.
- There is a need for continued investment in R&D, with expected growth of around 14% in fiscal 2025, which could impact short-term profitability.
- The company has $400 million in convertible debt maturing in March, which it expects to settle in cash, potentially impacting cash reserves.
Greetings, and welcome to the Guidewire fourth quarter and full year fiscal 2024 financial results conference call. (Operator Instructions) As a reminder, this call is being recorded.
I would now like to turn the call over to Alex Hughes, Vice President of Investor Relations. Thank you, Alex. You may begin.
Thanks, Paul. I'm Alex Hughes, Vice President of Investor Relations. And with me today is Mike Rosenbaum, Chief Executive Officer; Jeff Cooper, Chief Financial Officer; and John Mullen, President and Chief Revenue Officer, who has joined us to provide a year-end recap of adoption activity.
A complete disclosure of our results can be found in our press release issued today as well as in our related Form 8-K furnished to the SEC, both of which are available on the Investor Relations section of our website. Today's call is being recorded, and a replay will be available following the conclusion of the call.
Statements made on this call include forward-looking ones regarding our
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