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Jan 31
Guidewire Q2 2026 Earnings Report
Guidewire Q2 2026 Earnings Report
Key Takeaways
Guidewire delivered a strong second quarter with total revenue growing 24% year-over-year, driven by a 33% increase in subscription and support revenue. The company achieved a significant turnaround in GAAP net income and raised its full-year fiscal 2026 outlook across all key financial metrics, citing strong sales momentum and demand for AI-driven core system modernizations.
Annual Recurring Revenue (ARR) grew to $1.121 billion, representing a 22% increase year-over-year.
Subscription and support revenue surged 33% to $237.2 million, now making up 66% of total revenue.
The company flipped from a GAAP net loss of $37.3 million in the prior year to a GAAP net income of $60.1 million.
Guidewire authorized a new $500 million share repurchase program in January 2026 after completing its previous program.
Revenue by Segment
Forward Guidance
Guidewire raised its full-year fiscal 2026 guidance, expecting total revenue between $1.438 billion and $1.448 billion and ARR to reach up to $1.237 billion.
Positive Outlook
- Full-year ARR outlook raised to between $1.229 billion and $1.237 billion.
- Total revenue outlook increased to a range of $1.438 billion to $1.448 billion.
- Subscription and support revenue expected to reach up to $966 million for the year.
- Non-GAAP operating income guidance raised to between $293 million and $303 million.
- Operating cash flow projected to be strong, between $360 million and $375 million.
Challenges Ahead
- License revenue showed a 7% year-over-year decrease in Q2.
- GAAP operating income for Q3 is projected to be lower than Q2, between $11 million and $17 million.
- Guidance implies potential quarterly fluctuations in revenue recognition due to contract seasonality.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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