Guidewire Reports Good Results; Customers Thinking Smaller; Midterm Outlook Cut; FVE Cut to $95

Wide-moat Guidewire extended its streak of solid results with upside to both revenue and non-GAAP operating profits relative to guidance for its fourth quarter. Guidance was mixed, with better-than-expected revenue and lower-than-expected profitability. Management noted that customers have changed their buying patterns and are initially committing to smaller deals. As a result, the company also noted it expects lower profitability and lower growth in annual recurring revenue, or ARR, through fiscal 2025 than it had previously guided to, and will provide more detail at its upcoming investor day.