Guidewire Software, Inc.

Greetings and welcome to the Guidewire first quarter of fiscal 2025 financial results conference call. As a reminder, this call is being recorded and will be posted on our investor relations page later today. I would now like to turn the call over to Alex Hughes, Vice President of Investor Relations. Thank you, Alex. You may begin.

Thank you, Grace. Hello, everyone. With me today is Mike Rosenbaum, Chief Executive Officer, Jeff Cooper, Chief Financial Officer, John Mullen, President and Chief Revenue Officer, who will be with us for Q&A today on the call. A complete disclosure of our results can be found in our press release issued today, as well as in our related form, aka furnished to the SEC, both of which are available on the investor relations section of our website. Today's call is being recorded and a replay will be available following its conclusions. Statements today include forward-looking ones regarding our financial results, product, customer demand, operations, the impact of local, national, and geopolitical events on our business, and other matters. These statements are subject to risks. Uncertainties and assumptions are based on management's current expectations as of today and should not be relied upon as representing our views as of any subsequent date. Please refer to the press release and risk factors and documents we file with the SEC, including our most recent and report on Form 10-K. and our prior and forthcoming quarterly reports on Form 10-Q filed and to be filed with the SEC for more information on risks, uncertainties, and assumptions that may cause actual results to differ materially from those set forth in such statements. We also will refer to certain non-GAAP financial measures to provide additional information to investors. All commentary on margins, profitability, and expenses are on a non-GAAP basis unless stated otherwise. A reconciliation of non-gap-to-gap measures is provided in our press release. Reconciliations and additional data are also posted in the supplement on our IR website. Finally, this quarter, Investor Relations has decided to enter the current decade and conduct our earnings call on Zoom rather than a telebridge. This means we will manage the Q&A portion of today's call internally with the help of Grace Moderating, who you just heard from, and me managing Q&A. Since it's our first go, please be patient with us if we encounter any short pauses in in the handoffs during Q&A. So with that, I will hand it off to Mike.

Thank you, Alex. Good afternoon, and thanks, everyone, for joining us today. Q1 was a very strong start to the year for us, and coming on the heels of a record-breaking Q4, I'm excited about the continued and consistent momentum in our business. In November, we had the opportunity to connect with thousands of our customers and partners at our industry conference, Connections. and also released, less than a year, our 12th cloud release. Connections is an opportunity for us to present our company and product vision to the world, and the feedback has been universally positive. It was gratifying to see the results of our team's efforts come together, and I think it appropriate to call out four key themes that I took from the event, and I believe are driving our company right now. First... We continue to see strong demand from our cloud-based solutions, particularly at the high end of the market. Second, this demand is being driven by the increasing maturity of our cloud platform, particularly around the ease of updates, which is driving referenceability throughout our cloud customer base. Third, the improved agility and flexibility that our cloud platform and solutions deliver is resonating with the industry's growing demand for pace and speed in delivering analytics and AI-powered innovation. Fourth, our partner ecosystem, both in terms of consulting partners and marketplace solutions, continues to rally around our cloud platform, which is extending and accelerating our reach and impact. Finally, unrelated to connections but important to call out, we continue to create leverage in our operating model as we drive greater efficiency running Guidewire cloud platform. I'll touch on each of these briefly before handing it over to Jeff to discuss the financials. Cloud demand remained strong with nine deals in Q1. Our results were particularly strong at the high end of the market. Of the seven total InsuranceSuite Cloud deals, five were with Tier 1 insurers. This included two deals at Zurich Insurance Group, a top three global commercial insurer. In the quarter, we signed a global framework agreement with Zurich that streamlines the decision process for each of its local and country-specific entities to adopt Guidewire Cloud. In conjunction with this agreement, Guidewire Cloud was adopted within two Zurich entities, one for the full suite at an entity focused on large corporate and commercial lines, and another for claims center at Zurich, Australia. This agreement and these wins speak to our scale and ability to serve the largest insurers in the world. We closed another three insurance suite deals at Tier 1 insurers. Arch Insurance's middle market commercial and entertainment business selected InsuranceSuite on Guidewire Cloud. Also, one of the world's largest insurance companies based in Australia selected InsuranceSuite to replace the legacy system for the commercial lines of business. And a European mobility insurance arm of a global Tier 1 insurer elected to adopt InsuranceSuite for a multi-country rollout across Europe. As we have discussed before, these relationships take years to develop and are expected to last decades. We are all excited about the momentum in this segment of the market and the opportunity to serve some incredible new customers. Our continual momentum with Tier 1 insurers is great, but the international momentum is also exciting and aligns to a strategic focus we've outlined previously. In our European region, we added three cloud customers, including the ones I just mentioned – And I was particularly pleased to earn the trust of the Belois Group, a longtime self-managed customer who chose to migrate to Guidewire Cloud Platform while expanding to the full suite for its European entities. In the Asia-Pacific region, it was another strong quarter in Australia and New Zealand with two Tier 1 deals mentioned. I'm very pleased to see the investments we've made in this region continue to pay off. We also had another good quarter for insurance now, which supports smaller insurance customers with one net new win and an expansion in the quarter. Our continued strong demand is primarily driven by the increasing maturity and referenceability of the Guidewire Cloud platform and our cloud-based solutions. This was one of the main takeaways from Connections. Simply put, customers are successful with Guidewire and specifically Guidewire Cloud. And with more of our overall customer base now on cloud, customers who have been waiting for the right time to see the success and getting more serious about their plans for modernization. The CTO of Travelers shared her experience migrating to Policy Center on Guidewire Cloud and implored others to get started now, saying the faster and earlier you move, the sooner you'll drive growth and innovation. The COO of IAG, Australia's largest insurer and operator of 26 insurance brands, spoke about the greater efficiency and innovation they unlocked by consolidating to a single claims platform with intelligent automation. Their team has gone from taking 22 minutes to report a claim to just 90 seconds, and more importantly, has made it vastly easier for thousands of employees to develop and innovate on our platform. We also had the opportunity to connect with a leadership contingent from Japan at the event and conducted a specific strategy session for this market. It was exciting to see this level of engagement from our Japanese customers, and we're excited about the opportunity to further our commitment to the Japanese insurance market. The maturity of our cloud platform also creates the baseline PNC insurers need to innovate. Rapid technology advances around generative AI are underscoring the need for a modern cloud platform. At Connections, we shared our vision and plans to infuse generative AI in our platform and solutions to improve developer productivity and accelerate underwriting and claims processes. The feedback we received from customers was incredibly positive, as I think customers increasingly appreciate the need to run an agile and flexible core platform with modern APIs that allow them to innovate and stay competitive. The pace at which generative AI-driven capabilities are evolving is unprecedented, and taking advantage of this potential requires a modern core platform. This fact, together with the maturity of Guidewire Cloud Platform, especially around being able to take releases more easily, has led to very positive customer engagement and I think shifted the nature of many of our cloud migration conversations. It's great to see the maturity and momentum of our platform continue to grow And underscoring this was Gartner's recent Magic Quadrant for Software-as-a-Service PNC Core Platforms North America, which showed InsuranceSuite as the clear leader. Our partner community is a key element of our success, and we continue to see great momentum with both SI partners and technology partners. The presence of 33 SI partners, including PWC, Deloitte, Capgemini, Accenture, EY, Solars, and Cognizant was very impressive to see. It was clear that we bring to the table a unique strength relative to our competitors in the space. Our intention is to focus on being a best-in-class software company and build products that can be implemented successfully by partners. This strategy isn't just achieved by creating great products. It requires creating a one-of-a-kind partner ecosystem that ultimately creates far more successful customers. It was also great to see marketplace partners really step up and use the event as an opportunity to launch new technology and integrations with us. For example, High Marley launched a conversational first notice of loss experience that leverages automation and AI to dramatically increase the ease and speed of starting a claim. In addition, Box announced it's leveraging Guidewire Cloud Platform's integration framework to offer a pre-built integration that automatically extracts data from Box files and populates corresponding insurance suite records. Insurers can now automatically categorize and analyze claims documents, extracting critical information such as policy numbers, incident details, and customer data to accelerate claims processing and enhance accuracy. Partnerships like these increase my confidence that our approach to aggressively partner with companies across the insurance lifecycle is working, and like I said before, leading to better customer outcomes and success. Finally, as we grow adoption and deployments of Guidewire Cloud Platform, we continue to demonstrate increasing leverage in our business model. It is great to see expanding operating efficiency play out, with subscription and support gross margins reaching 70% in the first quarter. which Jeff will talk about in more detail. This continued operating execution gives us confidence in the future and the freedom to begin to work on what's next. To conclude, I'd say we continue to build a very attractive business with a blue-chip customer base and best-in-class customer retention that's based on a platform designed to continually deliver greater innovation and value to our customers in the P&C industry. We are at a point where pace of change makes a platform like this more important than ever for insurers, and we believe this positions us to build a business that delivers an attractive combination of durable growth and margin. And with that, I'll turn it over to Jeff to discuss the financials.