Guidewire Stock Soars 20% on Strong Q4 Earnings
Software provider surpasses $1 billion in annual recurring revenue, signaling strong cloud adoption and prompting a bullish outlook from Wall Street.
Shares of Guidewire Software (NYSE: GWRE) surged more than 20% in after-hours trading on Thursday after the company reported fourth-quarter earnings that significantly beat Wall Street expectations and provided a strong forecast for fiscal year 2026. The company, which provides software to the property and casualty insurance industry, also announced that it had surpassed a key milestone of $1 billion in annual recurring revenue (ARR).
Guidewire reported , easily beating the consensus estimate of $0.62 per share on revenue of $337.1 million. The company’s ARR, a key metric for subscription-based software companies, grew to $1.032 billion, up 19% on a constant currency basis.
The strong results were driven by the company’s ongoing transition to a cloud-based subscription model. Guidewire closed 19 cloud deals in the fourth quarter, including a significant 10-year agreement with a major Tier-1 insurer. “This was a landmark quarter for Guidewire, highlighted by our surpassing of the $1 billion ARR mark and the strong momentum we are seeing in our cloud business,” said Guidewire CEO Mike Rosenbaum in a statement.
Following the impressive earnings report, several Wall Street analysts reiterated their bullish stance on Guidewire. Analysts at J.P. Morgan noted that the company’s “cloud momentum continues to build, and the company is well-positioned to capitalize on the large and growing market opportunity in P&C insurance.” The firm maintained its “overweight” rating on the stock and raised its price target to $125 per share. , citing the company’s strong execution and improving profitability.
For the full fiscal year 2025, Guidewire reported total revenue of $1.2 billion, up 23% year-over-year. The company generated $300.9 million in cash from operations during the fiscal year and ended the year with $1.48 billion in cash, cash equivalents, and investments. Guidewire also provided a strong outlook for fiscal year 2026, with the company expecting revenue to be in the range of $1.385 billion to $1.405 billion and ARR to be between $1.210 billion and $1.220 billion. The company’s strong performance and upbeat guidance suggest that its transition to the cloud is paying off and that it is well-positioned for continued growth in the years ahead. As the insurance industry continues to modernize its IT infrastructure, .