Guidewire (0GS) AI Stock Analysis

Company Guidance

For fiscal 2027, Guidewire expects ARR of between $1.45 billion and $1.46 billion, representing 18% constant currency growth at the midpoint; total revenue of between $1.707 billion and $1.727 billion; subscription revenue to grow approximately 31%; subscription and support revenue of between $1.240 billion and $1.246 billion, representing 28% growth at the midpoint, with support revenue expected to decline about $8 million; license revenue of approximately $189 million, a decline of $46 million year-over-year, including term license revenue from recent cloud migration customers declining by almost $50 million; services revenue of approximately $285 million; subscription and support gross margins between 75% and 76%, professional services gross margin of approximately 12%, and total gross margins between 67% and 68%; non-GAAP operating income of between $403 million and $423 million, GAAP operating income of between $197 million and $217 million, stock-based compensation expense of approximately $202 million, cash flow from operations of between $445 million and $465 million, and CapEx of between $23 million and $28 million, including approximately $17 million in capitalized software development costs. For Q1, Guidewire expects ARR to be between $1.253 billion and $1.259 billion, subscription and support revenue between $279 million and $283 million, subscription and support margin around 77%, approximately $4 million in credit from its cloud infrastructure provider, services revenue of approximately $65 million, services margin around breakeven, and total gross margins of approximately 65%.