Record Quarterly Revenue of $106.8 Million, Up 19%
Year-Over-Year
Net Income of $0.3
Million; Adjusted EBITDA of $33.4
Million, Up 35% Year-Over-Year
Gross Revenue
Retention Rate of 99%; Net Revenue Retention Rate of
110%
Annualized Recurring Revenue of $427.2 Million, Up 22%
Year-Over-Year
Operating Cash Flows of $43.9 Million, Up 108% Year-Over-Year
BOISE,
Idaho, July 31, 2024 /PRNewswire/ -- Clearwater
Analytics Holdings, Inc. (NYSE: CWAN) ("Clearwater
Analytics" or the "Company"), a leading worldwide provider of
SaaS-based investment management, accounting, reporting, and
analytics solutions, today announced its financial results for the
quarter ended June 30, 2024.
"We had a very strong quarter where ARR grew 22% year on year,
revenue grew 19% and adjusted EBITDA grew 35%. Gross revenue
retention was 99% for a second successive quarter, which is a
strong reflection of the value our platform provides to our
customers. Unit economics continues to be strong and ahead of
stated goals because of the power of the single instance,
multi-tenant platform and the network effect it produces. We
continue to be very excited about client and prospect receptivity
to the new products we are developing, often in partnership with
our clients. These co-development efforts improve client
satisfaction, drive revenue growth and make our innovation more
targeted. Finally, our free cash flows grew by 117% compared to the
previous year," said Sandeep Sahai,
CEO at Clearwater Analytics. "Also in the second quarter, we
completed the acquisition of an advanced analytics platform from
Wilshire Advisors extending our capabilities in risk and
performance. Looking further ahead, we continue to make meaningful
investments in generative AI to drive responsiveness and
completeness to customer requests, improve data quality and drive
revenue growth. These financial results and continued client
momentum make us enthusiastic about what lies ahead for Clearwater
Analytics."
Second Quarter 2024 Financial Results Summary
- Revenue: Total revenue for the second quarter of 2024
was $106.8 million, an increase of
18.8%, from $89.9 million in the
second quarter of 2023.
- Gross Profit: Gross profit for the second quarter of
2024 increased to $76.9 million,
which equates to a 72.0% GAAP gross margin, compared with gross
profit of $62.9 million and GAAP
gross margin of 70.0% in the second quarter of 2023. Non-GAAP gross
profit for the second quarter of 2024 was $82.7 million, which equates to a 77.5% non-GAAP
gross margin and an increase of 170 basis points over the second
quarter of 2023.
- Net Income/(Loss): Net income for the second quarter of
2024 was $0.3 million, compared with
net loss of $11.9 million in the
second quarter of 2023.
- Adjusted EBITDA: Adjusted EBITDA for the second quarter
of 2024 was $33.4 million, an
increase of 34.7%, from $24.8 million
in the second quarter of 2023. Adjusted EBITDA margin for the
second quarter of 2024 was 31.3%, an increase of 370 basis points
over the second quarter of 2023.
- Cash Flows: Operating cash flows for the second quarter
of 2024 were $43.9 million. Free cash
flows for the second quarter of 2024 were $42.4 million, an increase of 116.9%, from
$19.6 million in the second quarter
of 2023. Cash flows improved from both stronger income as well as
positive working capital changes from better collections in the
quarter.
- Net Loss Per Share and Non-GAAP Net Income Per Share
attributable to Clearwater Analytics Holdings, Inc.: Net loss
per basic and diluted share was less than $0.01 in the second quarter of 2024. Non-GAAP net
income per basic share was $0.12, and
non-GAAP net income per diluted share was $0.10 in the second quarter of 2024.
- Cash, cash equivalents, and investments were
$297.6 million as of June 30, 2024. Total debt, net of debt issuance
cost, was $47.9 million as of
June 30, 2024.
Second Quarter 2024 Key Metrics Summary
- Annualized Recurring Revenue: As of June 30, 2024, annualized recurring revenue
("ARR") reached $427.2 million, an
increase of 22.2% from $349.5 million
as of June 30, 2023.
ARR is calculated at the end of a period by dividing the recurring
revenue in the last month of such period by the number of days in
the month and multiplying by 365.
- Gross Revenue Retention Rate: As of June 30, 2024, the gross revenue retention rate
was 99%, compared to 98% as of June 30,
2023.
Gross revenue retention rate represents annual contract value
("ACV") at the beginning of the 12-month period ended on the
reporting date less client attrition over the prior 12-month
period, divided by ACV at the beginning of the 12-month period,
expressed as a percentage. ACV is comprised of annualized recurring
revenue plus contracted-not-billed revenue, which represents the
estimated annual contracted revenue for new and existing client
opportunities prior to revenue recognition.
- Net Revenue Retention Rate: As of June 30, 2024, the net revenue retention rate was
110%, compared to 110% as of March 31,
2024 and to 109% as of June 30,
2023.
Net revenue retention rate is the percentage of recurring revenue
from clients on the platform for 12 months and includes changes
from the addition, removal, or value of assets on our platform,
contractual changes that have an impact to annualized recurring
revenues and lost revenue from client attrition.
Recent Business Highlights
- Clearwater Analytics continued on its journey towards being a
multi-product company and successfully drove cross-sell and upsell
in the second quarter. Highlights include:
- Clearwater PRISM clients, including Erste Asset Management GmbH
and M&G Investments, have adopted Clearwater PRISM for enhanced
client portal and reporting. Clearwater announced that Erste Asset
Management GmbH, one of the leading asset managers in Central and
Eastern Europe and managing €81.4
billion in assets, will leverage Clearwater PRISM to aggregate
multi-asset client investment data, help increase asset flows and
strengthen client service. M&G Investments, a leading
international asset manager and part of M&G plc, selected
Clearwater to automate investment
management and regulatory reporting and support the complex needs
of M&G's global insurance clients. With a white-labeled version
of Clearwater's platform,
M&G's insurance clients will have access to an M&G web
portal and rely on Clearwater PRISM for monthly report generation,
providing M&G's insurance clients with a complete view of their
investments and the ability to meet complex multi-basis accounting
requirements.
- A growing roster of clients use both Clearwater's JUMP solution for OMS/PMS and
Clearwater's accounting and
reconciliation solution. Clearwater Analytics announced that
Galilee Asset Management ("Galilee AM") selected Clearwater
Analytics as its enterprise standard for investment management.
Galilee AM will deploy Clearwater Analytics to support its rapid
growth and consolidate its activities after acquiring several
investment management companies.
- The Clearwater for Stable
Value solution was selected by Franklin
Templeton to help drive the growth of its stable value fund
business. Clearwater for Stable
Value will provide Franklin
Templeton with scalable investment technology, daily
portfolio insights, and stable value-specific capabilities to
support its expansion into separate accounts and new mandates.
Franklin Templeton's team will
leverage this enhanced technology to effectively handle the nuanced
aspects of managing stable value funds, including complex fund
structures, securities, and specialized accounting treatment.
- Clearwater Analytics announced that AXA XL's alternative
capital team selected Clearwater
to provide strategic support for a portion of its investment
portfolio. As one of the world's largest property and casualty
re/insurers, AXA XL provides insurance and risk management products
and services for mid-sized companies through to large
multinationals, and reinsurance solutions to insurance companies
globally. Clearwater was chosen
for its proven reliability, accuracy, and comprehensive ability to
meet their complex accounting book of record and regulatory
requirements, including customized general ledger entries.
- Clearwater Analytics hosted Clearwater Connect in London in the second quarter, where attendees
gained valuable insight from top leaders in the industry, connected
with over 150+ of their peers from around the world, and
participated in expert-led discussions on topics such as trends in
alternative investing, navigating regulations, managing investments
in turbulent times and more. Clearwater announced the winners of its Client
Awards, highlighting teams and firms that have achieved growth and
operational excellence in investment accounting with Clearwater's award-winning investment
accounting platform. Company winners included Aegon AM, Antares,
Aviva, Resolution Re, and RiverStone International.
- On the heels of our successful Clearwater Connect users'
conference, the Company plans to host another Clearwater Connect in
Boise on September 17-18, 2024, where current and
prospective users will have the opportunity to significantly
enhance their knowledge of the world's most comprehensive
investment management, accounting, and reporting solutions.
- Clearwater Analytics published its 2024 Insurance Investment
Outsourcing Report ("2024 IIOR"), the eleventh annual 'Yellow
Pages' of insurance-focused asset managers and a go-to resource for
insurance firms outsourcing investment management. The 2024 IIOR
includes 70 asset managers and 12 investment consultants, the
latter which are new for this year. This report is highly regarded
in the industry and leveraged by numerous insurers to identify
asset managers and consultants who focus on their space. The report
shows the outsourcing trend continues to grow with $3.6 trillion in insurance AUM reported, and over
$900 million of consultant assets
under advisement.
- Clearwater Analytics announced the release of its 2024 State of
Alternatives study. The report, encompassing over 230 executive
participants from sectors including insurance, wealth and asset
management, corporate and government entities, pensions and
endowments with $10 trillion in
assets under management (AUM), delivers an overview of the emerging
trends, opportunities and challenges related to alternative
investments. The 2024 State of Alternatives study highlighted key
factors and developments — including that 55% of institutional
investors plan to boost their alternative investments — that will
shape the alternatives landscape over the short-, medium- and long-
term. Per the study, respondents were unanimous about needing
better resources and technology to efficiently manage alternative
investments and mitigate the impact of regulatory and operational
challenges.
- Clearwater Analytics won the RegTech Insight Europe Awards 2024
for Best ESG Regulatory Solution. This recognition highlights
Clearwater's commitment to
simplifying ESG data collection, data analysis, risk management,
disclosure and reporting for its growing base of global
clients.
Third Quarter and Full Year 2024 Guidance
|
Third Quarter
2024
|
|
Full Year
2024
|
|
Revenue
|
$113 million to
$114 million
|
|
$442 million to
$444 million
|
|
Year-over-Year Growth
%
|
~19% to 20%
|
|
~20% to 21%
|
|
Adjusted
EBITDA
|
$36 million
|
|
$140 million
|
|
Adjusted EBITDA Margin
%
|
~32%
|
|
~32%
|
|
Total Equity-based
compensation expense and related payroll taxes
|
|
|
~$106
million
|
|
Depreciation and
Amortization
|
|
|
~$12 million
|
|
Non-GAAP effective tax
rate
|
|
|
25 %
|
|
Diluted non-GAAP share
count
|
|
|
~258
million
|
Certain components of the guidance given above are provided on a
non-GAAP basis only without providing a reconciliation to guidance
provided on a GAAP basis. Information is presented in this manner
because the preparation of such a reconciliation could not be
accomplished without "unreasonable efforts." The Company does not
have access to certain information that would be necessary to
provide such a reconciliation, including non-recurring items that
are not indicative of the Company's ongoing operations. The Company
does not believe that this information is likely to be significant
to an assessment of the Company's ongoing operations.
Conference Call Details
Clearwater Analytics will hold a conference call and webcast on
July 31, 2024, at 5:00 p.m. Eastern time to discuss second quarter
2024 financial results, provide a general business update, and
respond to analyst questions.
A live webcast of the call will also be available on the
Company's investor relations website. Please visit
investors.clearwateranalytics.com at least fifteen minutes prior to
the start of the event to register, download and install any
necessary audio software.
If you are unable to participate live, a replay of the webcast
will be available following the conference call on the Company's
investor relations website, along with the earnings press release,
and related financial tables.
About Clearwater Analytics
Clearwater Analytics (NYSE: CWAN), a global, industry-leading
SaaS solution, automates the entire investment lifecycle. With a
single instance, multi-tenant architecture, Clearwater offers award-winning investment
portfolio planning, performance reporting, data aggregation,
reconciliation, accounting, compliance, risk, and order management.
Each day, leading insurers, asset managers, corporations, and
governments use Clearwater's
trusted data to drive efficient, scalable investing on more than
$7.3 trillion in assets spanning
traditional and alternative asset types. Additional information
about Clearwater can be found at
clearwateranalytics.com.
###
Use of non-GAAP Information
This press release contains certain non-GAAP measures, including
non-GAAP gross profit, non-GAAP gross margin, adjusted EBITDA,
adjusted EBITDA margin, non-GAAP net income, non-GAAP net income
per basic and diluted share, non-GAAP effective tax rate, diluted
non-GAAP share count and free cash flow.
The non-GAAP measures are not based on any standardized
methodology prescribed by GAAP and are not necessarily comparable
to similar measures presented by other companies. However, the
Company believes that this non-GAAP information is useful as an
additional means for investors to evaluate its operating
performance, when reviewed in conjunction with its GAAP financial
statements. These measures should not be considered in isolation or
as a substitute for measures prepared in accordance with GAAP, and
because these amounts are not determined in accordance with GAAP,
they should not be used exclusively in evaluating the Company's
business and operations. In addition, undue reliance should not be
placed upon non-GAAP or operating information because this
information is neither standardized across companies nor subjected
to the same control activities and audit procedures that produce
the Company's GAAP financial results.
The Company's non-GAAP statement of operations measures,
including non-GAAP gross profit, non-GAAP gross margin, adjusted
EBITDA, adjusted EBITDA margin, non-GAAP net income, non-GAAP net
income per basic and diluted share, non-GAAP effective tax rate,
diluted non-GAAP share count and free cash flow, are adjusted to
exclude the impact of certain costs, expenses, gains and losses and
other specified items that management believes are not indicative
of its ongoing operations. These adjusted measures exclude the
impact of share-based compensation and eliminate potential
differences in results of operations between periods caused by
factors such as financing and capital structures, taxation
positions or regimes, restructuring, transaction expenses,
impairment and other charges.
Please refer to the reconciliations of these measures below to
what the Company believes are the most directly comparable measures
evaluated in accordance with GAAP.
Use of Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are
based on management's beliefs and assumptions and on information
currently available to management. Forward-looking statements
include information concerning the Company's possible or assumed
future results of operations, business strategies, technology
developments, financing and investment plans, dividend policy,
competitive position, industry, economic and regulatory
environment, potential growth opportunities and the effects of
competition. Forward-looking statements include statements that are
not historical facts and can be identified by terms such as
"anticipate," "believe," "could," "estimate," "expect," "intend,"
"aim," "may," "plan," "potential," "predict," "project," "seek,"
"should," "will," "would" or similar expressions and the negatives
of those terms, but are not the exclusive means of identifying such
statements.
Forward-looking statements involve known and unknown risks,
uncertainties, and other factors, many of which are beyond
Clearwater Analytics' control, that may cause the Company's actual
results, performance, or achievements to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements. These risks and
uncertainties may cause actual results to differ materially from
Clearwater Analytics' current expectations and include, but are not
limited to, the Company's ability to keep pace with rapid
technological change and market developments, including artificial
intelligence, competitors in its industry, the possibility that
market volatility, a downturn in economic conditions or other
factors may cause negative trends or fluctuations in the value of
the assets on the Company's platform, the Company's ability to
manage growth, the Company's ability to attract and retain skilled
employees, the possibility that the Company's solutions fail to
perform properly, disruptions and failures in the Company's and
third parties' computer equipment, cloud-based services, electronic
delivery systems, networks and telecommunications systems and
infrastructure, the failure to protect the Company, its customers'
and/or its vendors' confidential information and/or intellectual
property, claims of infringement of others' intellectual property,
factors related to the Company's ownership structure and status as
a "controlled company" as well as other risks and uncertainties
detailed in Clearwater Analytics' periodic public filings with the
U.S. Securities and Exchange Commission (the "SEC"), including but
not limited to those discussed under "Risk Factors" in the
Company's Annual Report on Form 10-K for the year ended
December 31, 2023 filed on
February 29, 2024, and in other
periodic reports filed by Clearwater Analytics with the SEC. These
filings are available at www.sec.gov and on Clearwater Analytics'
website.
Given these uncertainties, you should not place undue reliance
on forward-looking statements. Also, forward-looking statements
represent management's beliefs and assumptions only as of the date
of this press release and should not be relied upon as representing
Clearwater Analytics' expectations or beliefs as of any date
subsequent to the time they are made. Clearwater Analytics
does not undertake to and specifically declines any obligation to
update any forward-looking statements that may be made from time to
time by or on behalf of Clearwater Analytics.
###
|
Clearwater Analytics
Holdings, Inc.
|
|
Consolidated Balance
Sheets
|
|
(In thousands,
except share amounts and per share amounts,
unaudited)
|
|
|
June
30
|
|
December
31
|
|
2024
|
|
2023
|
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
190,095
|
|
$
221,765
|
|
Short-term
investments
|
67,819
|
|
74,457
|
|
Accounts receivable,
net
|
97,220
|
|
92,091
|
|
Prepaid expenses and
other current assets
|
27,577
|
|
27,683
|
|
Total current
assets
|
382,711
|
|
415,996
|
|
Property and equipment,
net
|
15,158
|
|
15,349
|
|
Operating lease
right-of-use assets, net
|
28,084
|
|
22,554
|
|
Deferred contract
costs, non-current
|
5,845
|
|
6,439
|
|
Intangible assets,
net
|
34,607
|
|
26,132
|
|
Goodwill
|
72,245
|
|
45,338
|
|
Long-term
investments
|
39,718
|
|
21,495
|
|
Other non-current
assets
|
6,779
|
|
5,440
|
|
Total assets
|
$
585,147
|
|
$
558,743
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
$
2,962
|
|
$
3,062
|
|
Accrued expenses and
other current liabilities
|
49,844
|
|
49,535
|
|
Notes payable, current
portion
|
2,750
|
|
2,750
|
|
Operating lease
liability, current portion
|
7,696
|
|
6,551
|
|
Tax receivable
agreement liability
|
16,749
|
|
18,894
|
|
Total current
liabilities
|
80,001
|
|
80,792
|
|
Notes payable, less
current maturities and unamortized debt issuance costs
|
45,183
|
|
45,828
|
|
Operating lease
liability, less current portion
|
21,306
|
|
16,948
|
|
Tax receivable
agreement, less current portion
|
6,500
|
|
—
|
|
Other long-term
liabilities
|
3,486
|
|
5,518
|
|
Total
liabilities
|
156,476
|
|
149,086
|
|
Stockholders'
Equity
|
|
|
|
|
Class A common stock,
par value $0.001 per share; 1,500,000,000 shares authorized,
160,421,799 shares issued and outstanding as of June 30, 2024,
127,604,185 shares issued and
outstanding as of December 31, 2023
|
160
|
|
128
|
|
Class B common stock,
par value $0.001 per share; 500,000,000 shares authorized,
111,191
shares issued and outstanding as of June 30, 2024 and
December 31, 2023
|
—
|
|
—
|
|
Class C common stock,
par value $0.001 per share; 500,000,000 shares authorized,
27,424,288
shares issued and outstanding as of June 30, 2024, 32,684,156
shares issued and outstanding as
of December 31, 2023
|
27
|
|
33
|
|
Class D common stock,
par value $0.001 per share; 500,000,000 shares authorized,
58,304,726
shares issued and outstanding as of June 30, 2024, 82,955,977
shares issued and outstanding as
of December 31, 2023
|
58
|
|
83
|
|
Additional
paid-in-capital
|
549,580
|
|
532,507
|
|
Accumulated other
comprehensive income
|
832
|
|
2,909
|
|
Accumulated
deficit
|
(170,050)
|
|
(181,331)
|
|
Total stockholders'
equity attributable to Clearwater Analytics Holdings,
Inc.
|
380,607
|
|
354,329
|
|
Non-controlling
interests
|
48,064
|
|
55,328
|
|
Total stockholders'
equity
|
428,671
|
|
409,657
|
|
Total liabilities and
stockholders' equity
|
$
585,147
|
|
$
558,743
|
|
Clearwater Analytics
Holdings, Inc.
|
|
Consolidated
Statements of Operations
|
|
(In thousands,
except share amounts and per share amounts,
unaudited)
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Revenue
|
$
106,791
|
|
$
89,879
|
|
$
209,510
|
|
$
174,485
|
|
Cost of
revenue(1)
|
29,890
|
|
26,954
|
|
58,069
|
|
51,779
|
|
Gross profit
|
76,901
|
|
62,925
|
|
151,441
|
|
122,706
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Research and
development(1)
|
35,360
|
|
29,848
|
|
73,036
|
|
57,948
|
|
Sales and
marketing(1)
|
15,169
|
|
14,331
|
|
31,480
|
|
29,029
|
|
General and
administrative(1)
|
22,528
|
|
25,871
|
|
43,248
|
|
49,177
|
|
Total operating
expenses
|
73,057
|
|
70,050
|
|
147,764
|
|
136,154
|
|
Income (loss) from
operations
|
3,844
|
|
(7,125)
|
|
3,677
|
|
(13,448)
|
|
Interest income,
net
|
(1,841)
|
|
(1,333)
|
|
(3,901)
|
|
(2,689)
|
|
Tax receivable
agreement expense
|
5,915
|
|
6,573
|
|
6,201
|
|
6,678
|
|
Other income,
net
|
(585)
|
|
(315)
|
|
(1,115)
|
|
(234)
|
|
Income (loss) before
income taxes
|
355
|
|
(12,050)
|
|
2,492
|
|
(17,203)
|
|
Provision for (benefit
from) income taxes
|
79
|
|
(174)
|
|
(19)
|
|
90
|
|
Net income
(loss)
|
276
|
|
(11,876)
|
|
2,511
|
|
(17,293)
|
|
Less: Net income (loss)
attributable to non-controlling
interests
|
706
|
|
(955)
|
|
1,044
|
|
(1,988)
|
|
Net income (loss)
attributable to Clearwater
Analytics Holdings, Inc.
|
$
(430)
|
|
$
(10,921)
|
|
$
1,467
|
|
$
(15,305)
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share attributable to Class A and
Class D common stockholders stock:
|
|
|
|
|
|
|
|
|
Basic
|
$
(0.00)
|
|
$
(0.06)
|
|
$
0.01
|
|
$
(0.08)
|
|
Diluted
|
$
(0.00)
|
|
$
(0.06)
|
|
$
0.01
|
|
$
(0.08)
|
|
|
|
|
|
|
|
|
|
Weighted average shares
of Class A and Class D
common stock outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
218,349,567
|
|
198,046,275
|
|
215,804,515
|
|
195,865,881
|
|
Diluted
|
218,349,567
|
|
198,046,275
|
|
254,208,965
|
|
195,865,881
|
|
|
(1) Amounts
include equity-based compensation as follows:
|
|
|
Cost of
revenue
|
$
3,273
|
|
$
3,248
|
|
$
6,419
|
|
$
5,491
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Research and
development
|
9,182
|
|
5,971
|
|
18,093
|
|
10,626
|
|
Sales and
marketing
|
2,692
|
|
3,246
|
|
6,513
|
|
7,211
|
|
General and
administrative
|
9,711
|
|
16,105
|
|
18,058
|
|
28,442
|
|
Total equity-based
compensation expense
|
$
24,858
|
|
$
28,570
|
|
$
49,083
|
|
$
51,770
|
|
Clearwater Analytics
Holdings, Inc.
|
|
Consolidated
Statements of Cash Flows
|
|
(In thousands,
unaudited)
|
|
|
Three Months Ended
June 30,
|
Six Months Ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
OPERATING
ACTIVITIES
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
276
|
|
$
(11,876)
|
|
$
2,511
|
|
$
(17,293)
|
|
Adjustments to
reconcile net income (loss) to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
2,941
|
|
2,412
|
|
5,491
|
|
4,860
|
|
Noncash operating
lease cost
|
2,312
|
|
1,917
|
|
4,545
|
|
3,769
|
|
Equity-based
compensation
|
24,858
|
|
28,570
|
|
49,083
|
|
51,770
|
|
Amortization of
deferred contract acquisition costs
|
1,196
|
|
1,150
|
|
2,413
|
|
2,351
|
|
Amortization of debt
issuance costs, included in interest expense
|
70
|
|
69
|
|
140
|
|
139
|
|
Deferred tax
benefit
|
(970)
|
|
(174)
|
|
(1,992)
|
|
(210)
|
|
Accretion of discount
on investments
|
(602)
|
|
(380)
|
|
(1,177)
|
|
(396)
|
|
Realized (gain) loss
on investments
|
24
|
|
(18)
|
|
24
|
|
(89)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
(42)
|
|
(3,759)
|
|
(4,718)
|
|
(9,898)
|
|
Prepaid expenses and
other assets
|
3,105
|
|
1,046
|
|
(1,093)
|
|
(540)
|
|
Deferred contract
acquisition costs
|
(1,024)
|
|
(701)
|
|
(1,771)
|
|
(1,287)
|
|
Accounts
payable
|
271
|
|
395
|
|
335
|
|
100
|
|
Accrued expenses and
other liabilities
|
5,256
|
|
(4,410)
|
|
(4,183)
|
|
(11,204)
|
|
Tax receivable
agreement liability
|
6,199
|
|
6,895
|
|
4,355
|
|
7,000
|
|
Net cash provided by
operating activities
|
43,870
|
|
21,136
|
|
53,963
|
|
29,072
|
|
INVESTING
ACTIVITIES
|
|
|
|
|
|
|
|
|
Purchases of property
and equipment
|
(1,454)
|
|
(1,576)
|
|
(2,947)
|
|
(3,293)
|
|
Purchase of held to
maturity investments
|
(3,009)
|
|
—
|
|
(3,009)
|
|
—
|
|
Purchases of
available-for-sale investments
|
(35,493)
|
|
(57,523)
|
|
(67,390)
|
|
(91,684)
|
|
Proceeds from sale of
available-for-sale investments
|
—
|
|
3,960
|
|
—
|
|
5,950
|
|
Proceeds from
maturities of investments
|
38,307
|
|
2,000
|
|
59,842
|
|
3,242
|
|
Acquisition of
business, net of cash acquired
|
(40,121)
|
|
—
|
|
(40,121)
|
|
—
|
|
Payment of initial
direct costs for operating leases
|
(104)
|
|
—
|
|
(104)
|
|
—
|
|
Net cash used in
investing activities
|
(41,874)
|
|
(53,139)
|
|
(53,729)
|
|
(85,785)
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
|
|
|
|
Proceeds from exercise
of options
|
5
|
|
486
|
|
109
|
|
3,179
|
|
Taxes paid related to
net share settlement of equity awards
|
(4,307)
|
|
(1,172)
|
|
(33,081)
|
|
(8,447)
|
|
Repayments of
borrowings
|
—
|
|
(687)
|
|
(688)
|
|
(1,374)
|
|
Payment of business
acquisition holdback liability
|
—
|
|
—
|
|
(780)
|
|
—
|
|
Proceeds from employee
stock purchase plan
|
2,795
|
|
2,595
|
|
2,795
|
|
2,595
|
|
Tax
distributions
|
—
|
|
—
|
|
(8)
|
|
—
|
|
Net cash used in
financing activities
|
(1,507)
|
|
1,222
|
|
(31,653)
|
|
(4,047)
|
|
Effect of exchange rate
changes on cash and cash equivalents
|
(38)
|
|
152
|
|
(251)
|
|
252
|
|
Change in cash and cash
equivalents during the period
|
451
|
|
(30,629)
|
|
(31,670)
|
|
(60,508)
|
|
Cash and cash
equivalents, beginning of period
|
189,644
|
|
220,845
|
|
221,765
|
|
250,724
|
|
Cash and cash
equivalents, end of period
|
$
190,095
|
|
$
190,216
|
|
$
190,095
|
|
$
190,216
|
|
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW
INFORMATION
|
|
|
|
|
|
|
|
|
Cash paid for
interest
|
$
851
|
|
$
870
|
|
$
1,762
|
|
$
2,220
|
|
Cash paid for income
taxes
|
$
144
|
|
$
759
|
|
$
590
|
|
$
1,068
|
|
NON-CASH INVESTING
AND FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
Purchase of property
and equipment included in accounts payable
and accrued expense
|
$
55
|
|
$
1
|
|
$
55
|
|
$
1
|
|
Tax distributions
payable to Continuing Equity Owners included in
accrued expenses
|
$
3,209
|
|
$
3,994
|
|
$
3,209
|
|
$
3,994
|
|
Clearwater Analytics
Holdings, Inc.
|
|
Reconciliation of
Net Loss to Adjusted EBITDA
|
|
(In thousands,
unaudited)
|
|
|
Three Months Ended
June 30,
|
|
2024
|
|
2023
|
|
(in thousands,
except percentages)
|
|
Net income
(loss)
|
$
276
|
|
0 %
|
|
$
(11,876)
|
|
(13 %)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Interest income,
net
|
(1,841)
|
|
(2 %)
|
|
(1,333)
|
|
(1 %)
|
|
Depreciation and
amortization
|
2,941
|
|
3 %
|
|
2,412
|
|
3 %
|
|
Equity-based
compensation expense and related
payroll taxes
|
25,151
|
|
24 %
|
|
28,685
|
|
32 %
|
|
Tax receivable
agreement expense
|
5,915
|
|
6 %
|
|
6,573
|
|
7 %
|
|
Transaction
expenses
|
875
|
|
1 %
|
|
257
|
|
0 %
|
|
Other
expenses(1)
|
131
|
|
0 %
|
|
108
|
|
0 %
|
|
Adjusted
EBITDA
|
33,448
|
|
31 %
|
|
24,826
|
|
28 %
|
|
Revenue
|
$
106,791
|
|
100 %
|
|
$
89,879
|
|
100 %
|
|
|
|
Six Months Ended
June 30,
|
|
2024
|
|
2023
|
|
(in thousands,
except percentages)
|
|
Net income
(loss)
|
$
2,511
|
|
1 %
|
|
$
(17,293)
|
|
(10 %)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Interest income,
net
|
(3,901)
|
|
(2 %)
|
|
(2,689)
|
|
(2 %)
|
|
Depreciation and
amortization
|
5,491
|
|
3 %
|
|
4,860
|
|
3 %
|
|
Equity-based
compensation expense and related
payroll taxes
|
53,632
|
|
26 %
|
|
53,192
|
|
30 %
|
|
Tax receivable
agreement expense
|
6,201
|
|
3 %
|
|
6,678
|
|
4 %
|
|
Transaction
expenses
|
1,678
|
|
1 %
|
|
1,550
|
|
1 %
|
|
Other
expenses(1)
|
38
|
|
0 %
|
|
1,069
|
|
1 %
|
|
Adjusted
EBITDA
|
65,650
|
|
31 %
|
|
47,367
|
|
27 %
|
|
Revenue
|
$
209,510
|
|
100 %
|
|
$
174,485
|
|
100 %
|
|
|
(1)
Other expenses include gain on investments, management fees
to our investors, income taxes, and foreign exchange gains and
losses.
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
(in
thousands)
|
|
Amortization of prepaid
management fees and
reimbursable expenses
|
637
|
|
597
|
|
1,172
|
|
1,213
|
|
Provision for (benefit
from) income tax expense
|
79
|
|
(174)
|
|
(19)
|
|
90
|
|
Other income,
net
|
(585)
|
|
(315)
|
|
(1,115)
|
|
(234)
|
|
Total other
expenses
|
$
131
|
|
$
108
|
|
$
38
|
|
$
1,069
|
|
Clearwater Analytics
Holdings, Inc.
|
|
Reconciliation of
Free Cash Flow
|
|
(In thousands,
unaudited)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net cash provided by
operating activities
|
$
43,870
|
|
$
21,136
|
|
$
53,963
|
|
$
29,072
|
|
Less: Purchases of
property and equipment
|
1,454
|
|
1,576
|
|
2,947
|
|
3,293
|
|
Free Cash
Flow
|
$
42,416
|
|
$
19,560
|
|
$
51,016
|
|
$
25,779
|
|
Clearwater Analytics
Holdings, Inc.
|
|
Reconciliation of
Non-GAAP Information
|
|
(In thousands,
except share amounts and per share amounts,
unaudited)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Revenue
|
$ 106,791
|
|
$
89,879
|
|
$ 209,510
|
|
$ 174,485
|
|
|
|
|
|
|
|
|
|
Gross profit
|
$
76,901
|
|
$
62,925
|
|
$ 151,441
|
|
$ 122,706
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related
payroll taxes
|
3,318
|
|
3,260
|
|
6,840
|
|
5,735
|
|
Depreciation and
amortization
|
2,494
|
|
1,930
|
|
4,596
|
|
3,903
|
|
Gross profit,
non-GAAP
|
$
82,713
|
|
$
68,115
|
|
$ 162,877
|
|
$ 132,344
|
|
As a percentage of
revenue, non-GAAP
|
77 %
|
|
76 %
|
|
78 %
|
|
76 %
|
|
|
|
|
|
|
|
|
|
Cost of
Revenue
|
$
29,890
|
|
$
26,954
|
|
$
58,069
|
|
$
51,779
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related
payroll taxes
|
3,318
|
|
3,260
|
|
6,840
|
|
5,735
|
|
Depreciation and
amortization
|
2,494
|
|
1,930
|
|
4,596
|
|
3,903
|
|
Cost of revenue,
non-GAAP
|
$
24,078
|
|
$
21,764
|
|
$
46,633
|
|
$
42,141
|
|
As a percentage of
revenue, non-GAAP
|
23 %
|
|
24 %
|
|
22 %
|
|
24 %
|
|
|
|
|
|
|
|
|
|
Research and
development
|
$
35,360
|
|
$
29,848
|
|
$
73,036
|
|
$
57,948
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related
payroll taxes
|
9,306
|
|
6,028
|
|
21,180
|
|
11,147
|
|
Depreciation and
amortization
|
164
|
|
253
|
|
365
|
|
531
|
|
Research and
development, non-GAAP
|
$
25,890
|
|
$
23,567
|
|
$
51,491
|
|
$
46,270
|
|
As a percentage of
revenue, non-GAAP
|
24 %
|
|
26 %
|
|
25 %
|
|
27 %
|
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
$
15,169
|
|
$
14,331
|
|
$
31,480
|
|
$
29,029
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related
payroll taxes
|
2,772
|
|
3,262
|
|
6,941
|
|
7,587
|
|
Depreciation and
amortization
|
155
|
|
145
|
|
290
|
|
298
|
|
Sales and marketing,
non-GAAP
|
$
12,242
|
|
$
10,924
|
|
$
24,249
|
|
$
21,144
|
|
As a percentage of
revenue, non-GAAP
|
11 %
|
|
12 %
|
|
12 %
|
|
12 %
|
|
|
|
|
|
|
|
|
|
General and
administrative
|
$
22,528
|
|
$
25,871
|
|
$
43,248
|
|
$
49,177
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related
payroll taxes
|
9,755
|
|
16,135
|
|
18,671
|
|
28,723
|
|
Depreciation and
amortization
|
128
|
|
84
|
|
240
|
|
128
|
|
Amortization of
prepaid management fees and
reimbursable expenses
|
637
|
|
597
|
|
1,172
|
|
1,213
|
|
Transaction
expenses
|
875
|
|
257
|
|
1,678
|
|
1,550
|
|
General and
administrative, non-GAAP
|
$
11,133
|
|
$
8,798
|
|
$
21,487
|
|
$
17,563
|
|
As a percentage of
revenue, non-GAAP
|
10 %
|
|
10 %
|
|
10 %
|
|
10 %
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
$
3,844
|
|
$
(7,125)
|
|
$
3,677
|
|
$ (13,448)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related
payroll taxes
|
25,151
|
|
28,685
|
|
53,632
|
|
53,192
|
|
Depreciation and
amortization
|
2,941
|
|
2,412
|
|
5,491
|
|
4,860
|
|
Amortization of
prepaid management fees and
reimbursable expenses
|
637
|
|
597
|
|
1,172
|
|
1,213
|
|
Transaction
expenses
|
875
|
|
257
|
|
1,678
|
|
1,550
|
|
Income from operations,
non-GAAP
|
$
33,448
|
|
$
24,826
|
|
$
65,650
|
|
$
47,367
|
|
As a percentage of
revenue, non-GAAP
|
31 %
|
|
28 %
|
|
31 %
|
|
27 %
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
276
|
|
$ (11,876)
|
|
$
2,511
|
|
$ (17,293)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related
payroll taxes
|
25,151
|
|
28,685
|
|
53,632
|
|
53,192
|
|
Depreciation and
amortization
|
2,941
|
|
2,412
|
|
5,491
|
|
4,860
|
|
Tax receivable
agreement expense
|
5,915
|
|
6,573
|
|
6,201
|
|
6,678
|
|
Amortization of
prepaid management fees and
reimbursable expenses
|
637
|
|
597
|
|
1,172
|
|
1,213
|
|
Transaction
expenses
|
875
|
|
257
|
|
1,678
|
|
1,550
|
|
Tax impacts of
adjustments to net income (loss)(1)
|
(8,968)
|
|
(6,619)
|
|
(17,667)
|
|
(12,570)
|
|
Net income,
non-GAAP
|
$
26,827
|
|
$
20,029
|
|
$
53,018
|
|
$
37,630
|
|
As a percentage of
revenue, non-GAAP
|
25 %
|
|
22 %
|
|
25 %
|
|
22 %
|
|
|
|
|
|
|
|
|
|
Net income per share -
basic, non-GAAP
|
$
0.12
|
|
$
0.10
|
|
$
0.25
|
|
$
0.19
|
|
Net income per share -
diluted, non-GAAP
|
$
0.10
|
|
$
0.08
|
|
$
0.21
|
|
$
0.15
|
|
|
|
|
|
|
|
|
|
Weighted-average common
shares outstanding - basic
|
218,349,567
|
|
198,046,275
|
|
215,804,515
|
|
195,865,881
|
|
Weighted-average common
shares outstanding -
diluted
|
256,090,273
|
|
252,249,228
|
|
254,208,965
|
|
256,412,731
|
|
|
(1) The
non-GAAP effective tax rate was 25% for the three and six months
ended June 30, 2024 and 2023, respectively, and has been used to
adjust the provision for income taxes for non-GAAP net income and
non-GAAP basic and diluted net income per share.
|
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SOURCE Clearwater Analytics Holdings, Inc.