Guidewire Software's stock plummeted 14.66% in post-market trading, according to movement data. The property and casualty insurance software provider reported third-quarter fiscal 2026 results that surpassed analyst expectations but failed to satisfy elevated market expectations.
The company reported adjusted earnings per share of $0.82, beating the $0.74 consensus estimate, while revenue of $372.5 million exceeded the $355.9 million forecast. However, the stock reversed sharply lower as the company's annual recurring revenue guidance for the full fiscal year, with a midpoint of $1.233 billion, came in slightly below Wall Street's estimate of $1.235 billion, raising concerns about future growth momentum.
Analysts noted that shares had rallied significantly in the days leading up to the earnings release, suggesting the positive results were already priced in. This created a classic "buy-the-rumor, sell-the-news" dynamic where investors took profits after the actual report. Following the results, RBC cut its price target on Guidewire to $215 from $250, while Raymond James reduced its target to $180 from $210.
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