0001528396-16-000034.txt : 20160301 0001528396-16-000034.hdr.sgml : 20160301 20160301162212 ACCESSION NUMBER: 0001528396-16-000034 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20160301 ITEM INFORMATION: Results of Operations and Financial Condition FILED AS OF DATE: 20160301 DATE AS OF CHANGE: 20160301 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Guidewire Software, Inc. CENTRAL INDEX KEY: 0001528396 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 364468504 STATE OF INCORPORATION: DE FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-35394 FILM NUMBER: 161473528 BUSINESS ADDRESS: STREET 1: 1001 E. HILLSDALE BOULEVARD CITY: FOSTER CITY STATE: CA ZIP: 94404 BUSINESS PHONE: 650-357-9100 MAIL ADDRESS: STREET 1: 1001 E. HILLSDALE BOULEVARD CITY: FOSTER CITY STATE: CA ZIP: 94404 8-K 1 q22016earningsrelease8-k.htm 8-K 8-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________________________________________
FORM 8-K
_______________________________________________________________
CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 1, 2016
_______________________________________________________________
Guidewire Software, Inc.
(Exact name of registrant as specified in its charter)
_______________________________________________________________
 
 
 
 
 
Delaware
 
001-35394
 
36-4468504
(State or other jurisdiction of incorporation)
 
(Commission File Number)
 
(I.R.S. Employer Identification No.)

1001 East Hillsdale Blvd., Suite 800
Foster City, CA 94404
(Address of principal executive offices, including zip code)

(650) 357-9100
(Registrant’s telephone number, including area code)

Not applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))






Item 2.02     Results of Operations and Financial Condition.

On March 1, 2016, Guidewire Software, Inc. (the "Company") issued a press release announcing unaudited financial results for its second quarter ended January 31, 2016. A copy of the press release is attached as Exhibit 99.1.

In accordance with General Instruction B.2 on Form 8-K, certain of the information in this Current Report on Form 8-K, including Exhibit 99.1, is being furnished under Item 2.02 and shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 ("Exchange Act") or otherwise subject to the liability of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, regardless of the general incorporation language of such filing, except as shall be expressly set forth by specific reference in such filing.

Item 9.01    Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No.
 
Description of Exhibits
99.1
 
Press release dated March 1, 2016, titled "Guidewire Software Announces Second Quarter Fiscal 2016 Financial Results"




SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: March 1, 2016
GUIDEWIRE SOFTWARE, INC.
 
 
By:
/s/ Richard Hart
 
Richard Hart
 
Chief Financial Officer




EXHIBIT INDEX
Exhibit No.
 
Description of Exhibits
99.1
 
Press release dated March 1, 2016, titled "Guidewire Software Announces Second Quarter Fiscal 2016 Financial Results"



EX-99.1 2 ex991q22016earningsrelease.htm EXHIBIT 99.1 Exhibit



Exhibit 99.1

Guidewire Software Announces Second Quarter Fiscal 2016 Financial Results

Foster City, CA - March 1, 2016 - Guidewire Software, Inc. (NYSE: GWRE), a provider of software products to Property and Casualty insurers, today announced its financial results for the fiscal quarter ended January 31, 2016.

“We achieved revenue and profitability above the high end of our guidance range for the second quarter, reflecting strong demand for both core system replacement and our newer products in the data management and digital engagement domains,” said Marcus Ryu, chief executive officer, Guidewire Software. “We believe the appeal that all the products in our portfolio have to a diverse set of insurers globally validates our strategy of industry focus and investment in product expansion.”

Ryu continued, “Our products have become even more appealing as they enable significant changes in P&C insurance strategies in response to data driven decisioning and end-market digital preferences. We intend to extend our product leadership to further service the industry and support our continued growth in the years ahead.”


Second Quarter Fiscal 2016 Financial Highlights

Revenue
License revenue for the second quarter of fiscal 2016 was $53.4 million, an increase of 22% from the second quarter of fiscal 2015. Maintenance revenue was $14.3 million, an increase of 17% and services revenue was $34.5 million, an increase of 3%. Total revenue was $102.1 million, an increase of 14% from the same quarter in fiscal 2015.
License revenue for the six months ended January 31, 2016 was $85.7 million, an increase of 18% from the comparable period of fiscal 2015. Maintenance revenue was $28.3 million, an increase of 15% and services revenue was $70.4 million, a decrease of 2%. Total revenue was $184.4 million, an increase of 9% from the same period in fiscal 2015.
Rolling four-quarter recurring term license and maintenance revenue was $238.3 million, an increase of 16% compared to the same period in fiscal 2015.

Profitability
GAAP operating income was $7.7 million for the second quarter of fiscal 2016, compared with $3.3 million in the comparable period in fiscal 2015.
Non-GAAP operating income was $24.6 million for the second quarter of fiscal 2016, compared with $17.2 million in the comparable period in fiscal 2015.
GAAP net income was $0.9 million for the second quarter of fiscal 2016, compared with $4.0 million for the comparable period in fiscal 2015. GAAP net income per share was $0.01, based on diluted weighted average shares outstanding of 73.4 million, compared with $0.06 per share for the comparable period in fiscal 2015, based on diluted weighted average shares outstanding of 72.1 million.
Non-GAAP net income was $17.8 million for the second quarter of fiscal 2016, compared with $12.5 million in the comparable period in fiscal 2015. Non-GAAP net income per diluted share was $0.24, based on diluted weighted average shares outstanding of 73.4 million, compared with $0.17 in the comparable period in fiscal 2015, based on diluted weighted average shares outstanding of 72.1 million.

Balance Sheet
The Company had $700.8 million in cash, cash equivalents and investments at January 31, 2016, compared with $677.8 million at July 31, 2015. The Company generated $37.9 million cash inflow from operations in the second quarter of fiscal 2016, compared with cash flow from operations of $9.6 million in the comparable period in fiscal 2015.






Business Outlook
Guidewire is issuing the following outlook for the third quarter and fiscal 2016, based on current expectations:
(in $ millions, except per share outlook)
 
Third Quarter Fiscal 2016
 
Full Year
Fiscal 2016
Revenue
 
90.3 - 94.3
 
408.5 - 416.5
License revenue
 
40.0 - 42.0
 
206.0 - 212.0
Maintenance revenue
 
14.0 - 14.5
 
56.5 - 58.5
Services revenue
 
36.0 - 38.0
 
144.0 - 148.0
GAAP operating income/(loss)
 
(11.8) - (7.8)
 
4.5 - 12.5
Non-GAAP operating income
 
4.5 - 8.5
 
69.0 - 77.0
GAAP net income/(loss)
 
(6.6) - (4.4)
 
1.8 - 6.3
GAAP net income/(loss) per share
 
(0.09) - (0.06)
 
0.03 - 0.09
Non-GAAP net income
 
3.1 - 5.8
 
46.3 - 51.7
Non-GAAP net income per share
 
0.04 - 0.08
 
0.64 - 0.71
Guidewire continues to target term license revenue growth of 20% or higher for the current fiscal year. Non-GAAP operating income and non-GAAP net income exclude stock-based compensation expense and amortization of intangible assets.

Conference Call Information
What:
Guidewire Software second quarter fiscal 2016 financial results conference call
When:
Tuesday, March 1, 2016
Time:
2:00 p.m. PT (5:00 p.m. ET)
Live Call:
(888) 661-5176, Domestic
(913) 312-6668, International
Replay:
(877) 870-5176, Passcode 6794165, Domestic
(858) 384-5517, Passcode 6794165, International
Webcast:
http://ir.guidewire.com (live and replay)

The webcast will be archived on Guidewire’s website for a period of three months.

Non-GAAP Financial Measures
This press release contains the following non-GAAP financial measures: Non-GAAP operating income, Non-GAAP net income, Non-GAAP net income per share and Non-GAAP tax provision. These Non-GAAP financial measures exclude stock-based compensation and amortization of intangibles, and the tax effect of these adjustments for Non-GAAP net income and Non-GAAP net income per share.
Guidewire believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Guidewire’s financial condition and results of operations. The Company’s management uses these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis, for purposes of determining executive and senior management incentive compensation and for budgeting and planning purposes. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.
Management of the Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures in connection with GAAP results. Guidewire urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including this press release, and not to rely on any single financial measure to evaluate the Company’s business.





Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included with the financial tables at the end of this release.

About Guidewire Software
Guidewire delivers the software that Property/Casualty (P/C) insurers need to adapt and succeed in a time of rapid industry change. We combine three elements - core processing, data and analytics, and digital engagement - into a technology platform that enhances insurers’ ability to engage and empower their customers and employees. More than 200 P/C insurers around the world have selected Guidewire. For more information, please visit www.guidewire.com. Follow us on twitter: @Guidewire_PandC.
NOTE: Guidewire, Guidewire Software, Guidewire ClaimCenter, Guidewire PolicyCenter, and Guidewire BillingCenter are registered trademarks of Guidewire Software, Inc. in the United States and/or other countries.

Cautionary Language Concerning Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding our financial outlook, market positioning and future investments. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Guidewire’s control. Guidewire’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, risks detailed in Guidewire’s most recent Forms 10-K and 10-Q filed with the Securities and Exchange Commission as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission. In particular, the following factors, among others, could cause results to differ materially from those expressed or implied by such forward-looking statements: the market for our software may develop more slowly than expected or than it has in the past; quarterly and annual operating results may fluctuate more than expected; seasonal and other variations related to our revenue recognition may cause significant fluctuations in our results of operations and cash flows; our reliance on sales to and renewals from a relatively small number of large customers for a substantial portion of our revenues; our services revenues produce lower gross margins than our license and maintenance revenues; assertions by third parties that we violate their intellectual property rights could substantially harm our business; we face intense competition in our market; weakened global economic conditions may adversely affect the P&C insurance industry including the rate of information technology spending; our product development and sales cycles are lengthy; the risk of losing key employees; changes in foreign exchange rates; general political or destabilizing events, including war, conflict or acts of terrorism; and other risks and uncertainties. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Guidewire’s views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. Guidewire undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Guidewire’s views as of any date subsequent to the date of this press release.

Media Contact:
Diana Stott
Guidewire Software, Inc.
(650) 356-4941
dstott@guidewire.com


Investor Contact:
Garo Toomajanian
ICR, LLC
(650) 357-5282
ir@guidewire.com





GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
 
 
 
 
 
January 31,
2016
 
July 31,
2015
ASSETS
 
 
 
CURRENT ASSETS:
 
 
 
Cash and cash equivalents
$
216,922

 
$
212,362

Short-term investments
374,022

 
359,273

Accounts receivable
59,392

 
62,062

Deferred tax assets, current

 
13,845

Prepaid expenses and other current assets
13,486

 
14,102

Total current assets
663,822

 
661,644

Long-term investments
109,820

 
106,117

Property and equipment, net
13,040

 
12,160

Intangible assets, net
3,279

 
3,999

Deferred tax assets, noncurrent
21,430

 
5,896

Goodwill
9,205

 
9,205

Other assets
3,681

 
926

TOTAL ASSETS
$
824,277

 
$
799,947

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
CURRENT LIABILITIES:
 
 
 
Accounts payable
$
7,259

 
$
8,816

Accrued employee compensation
21,990

 
37,235

Deferred revenues, current
57,796

 
50,766

Other current liabilities
7,411

 
7,592

Total current liabilities
94,456

 
104,409

Deferred revenues, noncurrent
4,167

 
1,800

Other liabilities
3,762

 
4,350

Total liabilities
102,385

 
110,559

STOCKHOLDERS’ EQUITY:
 
 
 
Common stock
7

 
7

Additional paid-in capital
697,628

 
662,869

Accumulated other comprehensive loss
(7,881
)
 
(6,343
)
Retained earnings
32,138

 
32,855

Total stockholders’ equity
721,892

 
689,388

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
824,277

 
$
799,947






GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands except share and per share data)
 
 
 
 
 
 
 
 
 
Three Months Ended January 31,
 
Six Months Ended January 31,
 
2016
 
2015
 
2016
 
2015
Revenues:
 
 
 
 
 
 
 
License
$
53,376

 
$
43,655

 
$
85,716

 
$
72,475

Maintenance
14,256

 
12,163

 
28,269

 
24,683

Services
34,497

 
33,628

 
70,424

 
72,022

Total revenues
102,129

 
89,446

 
184,409

 
169,180

Cost of revenues: (1)
 
 
 
 
 
 
 
License
1,577

 
1,145

 
2,741

 
2,227

Maintenance
2,636

 
2,271

 
5,111

 
4,513

Services
30,688

 
30,664

 
62,219

 
63,111

Total cost of revenues
34,901

 
34,080

 
70,071

 
69,851

Gross profit:
 
 
 
 
 
 
 
License
51,799

 
42,510

 
82,975

 
70,248

Maintenance
11,620

 
9,892

 
23,158

 
20,170

Services
3,809

 
2,964

 
8,205

 
8,911

Total gross profit
67,228

 
55,366

 
114,338

 
99,329

Operating expenses: (1) 
 
 
 
 
 
 
 
Research and development
25,409

 
22,282

 
51,081

 
42,592

Sales and marketing
22,661

 
20,176

 
41,952

 
37,705

General and administrative
11,456

 
9,573

 
22,566

 
19,335

Total operating expenses
59,526

 
52,031

 
115,599

 
99,632

Income (loss) from operations
7,702

 
3,335

 
(1,261
)
 
(303
)
Interest income
758

 
495

 
1,454

 
1,007

Other income (expense), net
(1,182
)
 
(861
)
 
(965
)
 
(1,344
)
Income (loss) before income taxes
7,278

 
2,969

 
(772
)
 
(640
)
Provision for (benefit from) income taxes
6,365

 
(1,007
)
 
(55
)
 
(1,619
)
Net income (loss)
$
913

 
$
3,976

 
$
(717
)
 
$
979

Net income (loss) per share:
 
 
 
 
 
 
 
Basic
$
0.01

 
$
0.06

 
$
(0.01
)
 
$
0.01

Diluted
$
0.01

 
$
0.06

 
$
(0.01
)
 
$
0.01

Shares used in computing net income (loss) per share:
 
 
 
 
 
 
 
Basic
71,779,496

 
69,883,622

 
71,511,198

 
69,600,161

Diluted
73,402,064

 
72,056,861

 
71,511,198

 
71,914,972







(1) Amounts include stock-based compensation expense as follows:
 
Three Months Ended January 31,
 
Six Months Ended January 31,
 
2016
 
2015
 
2016
 
2015
 
(unaudited, in thousands)
 Stock-based compensation expenses:
 
 Cost of license revenue
$
103

 
$
55

 
$
192

 
$
104

 Cost of maintenance revenues
380

 
309

 
719

 
586

 Cost of services revenues
4,673

 
3,878

 
9,036

 
7,391

 Research and development
3,911

 
2,662

 
7,583

 
4,805

 Marketing and sales
3,616

 
3,442

 
7,046

 
6,429

 General and administrative
3,862

 
3,152

 
7,116

 
6,171

 Total stock-based compensation expenses
$
16,545

 
$
13,498

 
$
31,692

 
$
25,486







GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
 
 
 
 
 
 
 
 
 
Three Months Ended January 31,
 
Six Months Ended January 31,
 
2016
 
2015
 
2016
 
2015
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
 
 
 
 
 
Net income (loss)
$
913

 
$
3,976

 
$
(717
)
 
$
979

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

Depreciation and amortization
1,751

 
1,848

 
3,542

 
3,621

Stock-based compensation
16,545

 
13,498

 
31,692

 
25,486

Excess tax benefit from exercise of stock options and vesting of restricted stock units
(91
)
 

 
(566
)
 

Deferred tax assets
5,202

 
(2,504
)
 
(1,703
)
 
(3,459
)
Amortization of premium on available-for-sale securities
961

 
1,470

 
1,838

 
2,884

Loss on disposals of property and equipment
5

 

 
23

 

Changes in operating assets and liabilities:

 

 

 


Accounts receivable
(5,417
)
 
(22,268
)
 
2,221

 
(12,775
)
Prepaid expenses and other assets
(1,237
)
 
2,541

 
(2,308
)
 
1,727

Accounts payable
1,151

 
730

 
(1,391
)
 
817

Accrued employee compensation
4,876

 
4,017

 
(14,964
)
 
(13,215
)
Other liabilities
918

 
447

 
(121
)
 
457

Deferred revenues
12,343

 
5,860

 
9,484

 
(2,455
)
Net cash provided by operating activities
37,920

 
9,615

 
27,030

 
4,067

CASH FLOWS FROM INVESTING ACTIVITIES:
 
 
 
 
 
 
 
Purchases of available-for-sale securities
(146,654
)
 
(123,111
)
 
(341,990
)
 
(236,841
)
Sales of available-for-sale securities
132,640

 
129,356

 
321,507

 
231,895

Purchase of property and equipment
(851
)
 
(2,402
)
 
(3,867
)
 
(3,651
)
Net cash used in investing activities
(14,865
)
 
3,843

 
(24,350
)
 
(8,597
)
CASH FLOWS FROM FINANCING ACTIVITIES:
 
 
 
 
 
 
 
Proceeds from issuance of common stock upon exercise of stock options
2,526

 
2,414

 
3,989

 
3,859

Taxes remitted on RSU awards vested
(614
)
 
(9,278
)
 
(1,488
)
 
(17,848
)
Excess tax benefit from exercise of stock options and vesting of restricted stock units
91

 

 
566

 

Net cash provided by (used in) financing activities
2,003

 
(6,864
)
 
3,067

 
(13,989
)
Effect of foreign exchange rate changes on cash and cash equivalents
(867
)
 
(2,880
)
 
(1,187
)
 
(4,358
)
NET CHANGE IN CASH AND CASH EQUIVALENTS
24,191

 
3,714

 
4,560

 
(22,877
)
CASH AND CASH EQUIVALENTS—Beginning of period
192,731

 
121,510

 
212,362

 
148,101

CASH AND CASH EQUIVALENTS—End of period
$
216,922

 
$
125,224

 
$
216,922

 
$
125,224







GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Operating Results
(unaudited, in thousands)
 
 
 
 
 
 
 
 
The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP operating results for the periods indicated below:
 
Three Months Ended January 31,
 
Six Months Ended January 31,
Income (loss) from operations reconciliation:
2016
 
2015
 
2016
 
2015
GAAP net income (loss) from operations
$
7,702

 
$
3,335

 
$
(1,261
)
 
$
(303
)
Non-GAAP adjustments:
 
 
 
 
 
 
 
Stock-based compensation (1)
16,545

 
13,498

 
31,692

 
25,486

Amortization of intangibles (1)
360

 
360

 
720

 
720

Non-GAAP income from operations
$
24,607

 
$
17,193

 
$
31,151

 
$
25,903

 
 
 
 
 
 
 
 
Net income (loss) reconciliation:
 
 
 
 
 
 

GAAP net income (loss)
$
913

 
$
3,976

 
$
(717
)
 
$
979

Non-GAAP adjustments:
 
 
 
 
 
 


Stock-based compensation (1)
16,545

 
13,498

 
31,692

 
25,486

Amortization of intangibles (1)
360

 
360

 
720

 
720

Tax effect on non-GAAP adjustments (2)
26

 
(5,384
)
 
(9,098
)
 
(9,070
)
Non-GAAP net income
$
17,844

 
$
12,450

 
$
22,597

 
$
18,115


 
 
Three Months Ended January 31,
 
Six Months Ended January 31,
 
 
2016
 
2015
 
2016
 
2015
Tax provision (benefits) reconciliation:
 
 
 
 
 
 
 
GAAP tax provision (benefits)
$
6,365

 
$
(1,007
)
 
$
(55
)
 
$
(1,619
)
Non-GAAP adjustments:


 


 


 


 
Stock-based compensation
5,143

 
4,215

 
10,142

 
8,410

 
Amortization of intangibles
111

 
111

 
230

 
238

 
ISO deduction
108

 
139

 
167

 
216

 
Tax effect on GAAP profit before taxes due to different tax rates between GAAP and non-GAAP
(5,388
)
 
919

 
(1,441
)
 
206

Non-GAAP tax provision
$
6,339

 
$
4,377

 
$
9,043

 
$
7,451


(1) Adjustments relate to amortization of acquired intangibles and stock-based compensation recognized during the period for GAAP purposes.
(2) Adjustment reflects the tax benefit resulting from all non-GAAP adjustments.






GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Operating Results
(unaudited, in thousands except share and per share data)
 
 
 
 
 
 
 
 
The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP operating results for the periods indicated below:
 
Three Months Ended January 31,
 
Six Months Ended January 31,
Earnings per share reconciliation:
2016
 
2015
 
2016
 
2015
GAAP earnings per share - Diluted
$
0.01

 
$
0.06

 
$
(0.01
)
 
$
0.01

Amortization of intangibles acquired in business combinations
0.01

 

 
0.01

 
0.01

Stock-based compensation
0.23

 
0.18

 
0.44

 
0.35

Less tax benefit of non GAAP items

 
(0.07
)
 
(0.13
)
 
(0.12
)
Non-GAAP dilutive shares excluded from GAAP EPS calculation (1)
(0.01
)
 

 

 

Non-GAAP earnings per share - Diluted
$
0.24

 
$
0.17

 
$
0.31

 
$
0.25

 
(1) Due to the occurrence of a net loss on a GAAP basis, potentially dilutive securities were excluded from the calculation of GAAP earnings per share, as they would have an anti-dilutive effect. However, as net income was earned on a Non-GAAP basis, these shares have a dilutive effect on Non-GAAP earnings per share and are included here.
 
 
 
 
 
 
 
 
 
Three Months Ended January 31,
 
Six Months Ended January 31,
Shares used in computing non-GAAP per share amounts:
2016
 
2015
 
2016
 
2015
Weighted average shares - Diluted
73,402,064

 
72,056,861

 
71,511,198

 
71,914,972

Non-GAAP dilutive shares excluded from GAAP EPS calculation (1)

 

 
1,711,132

 

Pro forma weighted average shares - Diluted
73,402,064

 
72,056,861

 
73,222,330

 
71,914,972

 
(1) Due to the occurrence of a net loss on a GAAP basis, potentially dilutive securities were excluded from the calculation of GAAP earnings per share, as they would have an anti-dilutive effect. However, as net income was earned on a Non-GAAP basis, these shares have a dilutive effect on Non-GAAP earnings per share and are included here.






GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES
Reconciliation of GAAP to Non-GAAP Outlook
The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP outlook for the periods indicated below:
(in $ millions)
 
Third Quarter Fiscal 2016
 
Full Year
Fiscal 2016
Outlook reconciliation: GAAP and non-GAAP operating income/(loss)
 
 
 
 
GAAP operating income/(loss)
 
(11.8) - (7.8)
 
4.5 - 12.5
Non-GAAP adjustments:
 
 
 
 
Stock-based compensation
 
15.4 - 16.4
 
62.0 - 64.0
Amortization of intangibles
 
0.4
 
1.4
Non-GAAP income from operations
 
4.5 - 8.5
 
69.0 - 77.0
 
 
 
 
 
Outlook reconciliation: GAAP and non-GAAP net income/(loss)
 
 
 
 
GAAP net income (loss)
 
(6.6) - (4.4)
 
1.8 - 6.3
Non-GAAP adjustments:
 
 
 
 
Stock-based compensation
 
15.4 - 16.4
 
62.0 - 64.0
Amortization of intangibles
 
0.4
 
1.4
Tax effect on non-GAAP adjustments
 
(6.6) - (6.1)
 
(20.0) - (19.1)
Non-GAAP net income
 
3.1 - 5.8
 
46.3 - 51.7