Guidewire Software, Inc. (NYSE:GWRE) Q1 2020 Earnings Conference Call - Final Transcript

Dec 05, 2019 • 05:00 pm ET

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Guidewire Software, Inc. (NYSE:GWRE) Q1 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Thank you. At this time, we'll be conducting a question-and-answer session. [Operator Instructions] Your first question comes from the line of Ken Wong with Guggenheim. Please proceed with your question.

Analyst
Kenneth Wong

Great, thanks for taking my question guys. Maybe just first one for you, Curtis, as we look at Q2 revenue, it does look a lot lower than maybe what me and my peers were projecting. Just wondering, is this -- do you think this is maybe do more to return to a different type of seasonality, is there more cloud deals expected in Q2 in terms of mix then maybe we might be thinking about? Just any color there would be helpful to the extent that there is maybe some dynamic we're missing.

Executive
Curtis Smith

Yes, sure. So we noted the same seasonality in Q1 that we've seen in the past and Q2 is obviously up over Q1. And we've also noted that in general, we've tried to focus the investor and analyst community [Phonetic] on annual results and not necessarily the quarterly results because things do move up and down. So I think that's what you're seeing in Q2. As we noted in our comments, we are continuing to see cloud demand out there, we will continue to monitor that over the next quarter and provide any updates coming out of Q2.

Analyst
Kenneth Wong

Got it, got it. And then, Mike, a question for you when we see a lot of the recent deal announcements we've noticed that quite a few of your customers are deploying InsuranceSuite on a partner cloud. Can you maybe talk about this dynamic relative to what you're seeing on the Guidewire cloud side and how do you think this might impact cloud adoption for Guidewire specific cloud versus partners down the line?

Executive
Mike Rosenbaum

Yes, sure. Good question. Yes, I think that there is definitely this dynamic in the industry, not just specifically in P&C insurance around moving on-prem workloads to cloud environments and sometimes that can be facilitated through a partner and we certainly see partners in our ecosystem that are working with customers to do that. I think in the end, if you think about the long term, the offering that cut -- that we expect most of Guidewire customers to move to in our cloud offering, that will be significantly different than just simply running an instance of Guidewire as a managed service on cloud infrastructure. I think when you look at some of the things that we announced at Connections around native cloud services that we are building and releasing alongside, specifically what we talked about Connections with specifically in PolicyCenter, those types of services will end up being distinct and different from what you are able to achieve when you're -- what's effectively a managed service or a self-managed implementation that you're managing with a partner.

I want to be clear though that we remain committed to that mode of operation. We have a significant customer base that's running Guidewire in a self-managed mode and they