Guidewire Software Inc (NYSE: GWRE) stock fell 7.2% in the after hours session on December 4th, 2018 (Source: Google finance) post lower than expected outlook. For the second quarter ending in February, Guidewire Software expects its per-share earnings to range from 17 cents to 21 cents. The company expects revenue to be in the range of $157 million to $161 million for the fiscal second quarter. Analysts surveyed by Zacks had expected revenue of $172.2 million. Guidewire Software expects full-year earnings in the range of $1.24 to $1.34 per share, with revenue ranging from $722 million to $732 million.
The Company had $1.2 billion in cash, cash equivalents and investments at October 31, 2018, compared with $1.3 billion at July 31, 2018. The company has used $27.2 million cash from operations in the first quarter of fiscal year 2019, reflecting normal seasonal patterns. During the quarter, the company saw market demand for Guidewire Insurance Platform continue to build for core applications, as well as the data and digital products. The all-in-one core system, InsuranceNow, also contributed to Guidewire Cloud adoption, and during the first quarter, Oklahoma Farm Bureau Mutual Insurance Company, an existing on-premise InsuranceNow customer, decided to meaningfully expand their investment with Guidewire by entrusting the company to manage their instance of InsuranceNow through Guidewire Cloud.
GWRE in the first quarter of FY 19 has reported the adjusted earnings per share of 36 cents, while adjusted revenue growth was 66 percent to $179.7 million in the first quarter of FY 19. License and subscription revenue was $94.3 million, an increase of 213%; services revenue was $64.4 million, an increase of 9%; and maintenance revenue was $21.0 million, an increase of 11%. First quarter year-over-year growth comparisons were positively impacted by the adoption of ASC 606. Gross profit was $109 million in the first quarter, up 98% from a year ago, due to the revenue growth. Gross margin for the quarter was 61%, compared to 51% a year ago. The increase in gross margin for the quarter is largely related to timing of revenu. Services gross margin for the quarter was 8%, down from 20% a year ago, due to continued investments in ongoing cloud implementations and capacity for future implementations