Guidewire Software's (GWRE) fiscal 2027 outlook disappointed amid elevated expectations after its strong fiscal Q4 results, RBC Capital Markets said in a Friday note.
The company reported fiscal Q4 non-GAAP diluted earnings of $0.99 per diluted share, up from $0.81 a year earlier, as revenue rose to $411.1 million from $356.6 million.
Guidewire said it expects revenue of $372 million to $378 million in fiscal Q1 and $1.71 billion to $1.73 billion in fiscal 2027.
The fiscal Q1 outlook was below the Street view and while the fiscal 2027 guidance was slightly above consensus. RBC said the company's full-year projections did not reflect upside from its 22% fully ramped annual recurring revenue trajectory.
Guidewire management attributed the soft outlook to normalizing attrition from record-low levels in fiscal 2026 and lower conversion of backlog into annual recurring revenue, according to the note.
RBC has an outperform rating on Guidewire Software with a $215 price target.
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