Key Highlights

● Fiscal 2026 revenue was $1,475.4 million, up 23% from $1,202.5 million.

● Subscription and support revenue rose 33% to $970.9 million.

● Annual recurring revenue closed at $1,237 million, up 19% in constant currency.

● Guidewire repurchased 4,085,350 shares for $606.3 million during the year.

Guidewire Software, Inc. (NYSE:GWRE), the insurance-industry software provider whose common stock trades on the New York Stock Exchange under the ticker GWRE, reported fourth-quarter and full-year results for the fiscal year ended July 31, 2026 on September 3, 2026. Total revenue for the year was $1,475.4 million, up 23% from $1,202.5 million, while fourth-quarter revenue was $411.1 million, up 15%.

The mix matters. Subscription and support revenue rose 33% over the year to $970.9 million, whereas license revenue fell 7% to $234.6 million and services revenue grew 23% to $269.9 million. In the fourth quarter alone, subscription and support grew 32% while license revenue declined 18%.

Annual recurring revenue (ARR) closed at $1,237 million, which the company said represented constant-currency growth of 19%. Fully ramped ARR was $1,573 million, up 22% in constant currency.

Profitability and Cash Generation

Margins improved materially. GAAP income from operations for the year was $149.9 million, compared with $41.1 million a year earlier, and non-GAAP operating income reached $339.9 million. GAAP diluted earnings per share were $1.63 against $0.81, while non-GAAP diluted earnings per share were $3.43 against $2.51. Non-GAAP measures exclude items such as stock-based compensation and amortization, and prior-period figures were recast after a methodology change.

The fourth quarter was less tidy on a GAAP basis. Net income was $31.4 million, down from $52.0 million, which the company linked partly to a $24.0 million foreign-currency loss, even though income from operations roughly doubled to $62.3 million.

Operating cash flow for the year was $389.7 million, against $300.9 million, and free cash flow was $358.7 million. Chief financial officer Jeff Cooper cited a 26% operating cash flow margin and the lowest ARR gross attrition rate since measurement began; both are management statements.

Capital Allocation and Guidance

Guidewire repurchased 4,085,350 shares during the year at an average of $148.41, totaling $606.3 million, leaving $31.9 million of authorization at year end. Cash, equivalents and investments fell to $1,215.3 million from $1,483.2 million a year earlier.

For fiscal 2027, management guided to ending ARR of $1,450 million to $1,460 million, total revenue of $1,707 million to $1,727 million, non-GAAP operating income of $403 million to $423 million and operating cash flow of $445 million to $465 million. Guidance for subscription and support revenue is $1,240 million to $1,246 million, which implies growth of roughly 28% at the midpoint on this year's $970.9 million. First-quarter guidance is revenue of $372 million to $378 million and ending ARR of $1,253 million to $1,259 million. These are company forecasts, not outcomes.

Implementation Risk and Limited Buyback Room

S&P Dow Jones Indices announced in January 2025 that Guidewire would join the S&P MidCap 400, replacing Arrowhead Pharmaceuticals (NASDAQ:ARWR).

Risks are familiar ones. Growth depends on large, multi-year implementations for insurers, and the shift from licenses to subscriptions can make reported revenue slower to recognize. The gap between GAAP and non-GAAP operating income, $149.9 million against $339.9 million for the year, is also large. Currency movements affected fourth-quarter net income, and the company's forward-looking statements flag execution and competitive risks. Management describes artificial intelligence as a demand driver, yet that remains an assertion until visible in ARR conversion. With little buyback authorization left and a lower cash balance, further repurchases would need fresh board action.