Record Quarterly Revenue of $94.7 Million, Up 24% Year-Over-Year
Adjusted EBITDA of $28.6 Million, Up
51% Year-Over-Year
Adjusted EBITDA margin of 30%
BOISE,
Idaho, Nov. 1, 2023 /PRNewswire/ -- Clearwater
Analytics Holdings, Inc. (NYSE: CWAN) ("Clearwater
Analytics" or the "Company"), a leading provider of SaaS-based
investment management, accounting, reporting, and analytics
solutions, today announced its financial results for the quarter
ended September 30, 2023.
"Our Q3 financial performance speaks for itself and is a direct
result of Clearwater's tireless
commitment to disciplined execution and client success. By focusing
on our clients, we achieved strong financial results and even
greater client outcomes. Examples of that client-first mindset
include streamlining the client onboarding process from an average
time of nine to five months, uniting more than 500 industry leaders
and experts at our annual user conference for expert training and
advice, and innovating our product offerings to further capture
competitive wins while improving our cross-sell and upsell sales
motions," said Sandeep Sahai, Chief
Executive Officer. "As an organization, our primary goal lies in
championing clients' success by enabling decision makers to unlock
significant gains in business productivity and explore new avenues
for growth."
Third Quarter 2023 Financial Results Summary
- Revenue: Total revenue for the third quarter of 2023 was
$94.7 million, an increase of 23.7%,
from $76.6 million in the third
quarter of 2022.
- Gross Profit: Gross profit for the third quarter of 2023
increased to $67.7 million, compared
with $53.8 million in the third
quarter of 2022. Non-GAAP gross profit for the third quarter of
2023 was $73.2 million, which equates
to a 77.4% non-GAAP gross margin, an increase of 250 basis points
over the third quarter of 2022.
- Net Income/(Loss): Net loss for the third quarter of
2023 was $2.3 million compared with
net loss of $3.0 million in the third
quarter of 2022. Net loss for the third quarter included total
equity-based compensation expense and related payroll taxes of
$31.2 million, including $5.6 million related to the JUMP Technology
acquisition, which closed in the fourth quarter of 2022. Non-GAAP
net income for the third quarter of 2023 increased to $23.7 million from $13.8
million in the third quarter of 2022.
- Adjusted EBITDA: Adjusted EBITDA for the third quarter
of 2023 was $28.6 million, up from
$18.8 million in the third quarter of
2022. Adjusted EBITDA margin for the third quarter of 2023 was
30.2%.
- Cash Flows: Operating cash flows for the third quarter
of 2023 were $31.7 million. Free cash
flows for the third quarter of 2023 increased to $30.9 million from $12.8
million in the third quarter of 2022.
- 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 $0.01
in the third quarter of 2023. Non-GAAP net income per basic share
was $0.12, and non-GAAP net income
per diluted share was $0.09 in the
third quarter of 2023.
- Cash, cash equivalents, and investments were
$302.8 million as of September 30, 2023. Total debt, net of debt
issuance cost, was $48.7 million as
of September 30, 2023.
Third Quarter 2023 Key Metrics Summary
- Annualized Recurring Revenue: As of September 30, 2023, annualized recurring revenue
("ARR") reached $362.4 million, an
increase of 19.4% from $303.6 million
as of September 30, 2022.
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 September 30, 2023, the gross revenue retention
rate was 98%, consistent with the Company's gross revenue retention
rate as of September 30, 2022. The
Company has reported a gross revenue retention rate of 98% for
eighteen out of the nineteen prior quarters.
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 September 30, 2023, the net revenue retention
rate was 108%, compared to 109% as of June
30, 2023, and 103% as of September
30, 2022.
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 hosted its annual Clearwater Connect
conference bringing more than 500 global in-person attendees
together in Boise, Idaho. At the
event, attendees learned about new product innovations, including
the latest advancements with generative AI and how it is expected
to enable significant productivity gains, cost reductions, and
operational improvements that modernize the client experience.
Clearwater attendees significantly
enhanced their knowledge of the world's most comprehensive
investment accounting solution by attending sessions and seeing
demonstrations on:
- Clearwater LPx, a full-service solution that solves many
of the operational challenges associated with accounting and
reporting on private funds. Attendees saw product enhancements up
close on Clearwater LPx Clarity, J-Curve, Clearwater's LPx's Management Console and
more.
- Clearwater MLx, an all-in-one experience for mortgage loan
investors to make informed decisions at any stage of the loan
lifecycle, from origination and deal management to analytics,
accounting, and reporting.
- The many innovations to the Clearwater Platform in areas of
focus such as Income Forecasting, ESG Data & Reporting,
Self-Service, LIBOR to SOFR Transition, and more.
- Clearwater Prism expanded capabilities, including a web-based
editor for client users and expanded abilities to support
attribution and ESG reporting as well as EU languages and regional
formats.
- Clearwater JUMP's OMS and PMS capabilities and how this
advanced offering delivers a unified, trusted full investment
lifecycle platform to the marketplace.
- Clearwater announced the
winners of its Client Awards, highlighting individuals, teams, and
firms that have achieved growth, operational excellence,
transformations and more with Clearwater's award-winning investment
accounting platform. Company winners included Blackstone, Global
Atlantic Financial Group, J.P. Morgan, Prosperity Life Group,
Resolution Life US, and Transamerica. This year's client award
winners included individuals from Arch Capital Group, Asset
Allocation & Management Company, Cove Street Capital, Deseret
Mutual Benefit Administrators, and Nationwide.
- Clearwater Analytics announced that Ofi Invest Asset
Management, part of Ofi Invest Group and France's fifth-largest asset management group
with more than €187 billion under management, selected Clearwater's platform to power its investment
accounting management, reporting, and services. In the third
quarter, the Company expanded its footprint within existing clients
and added marquee clients such as Alpha Warranty, Atrium Group
Services Limited, Chilton Investment Services, Crossmark Global
Investments Inc., Highview National Insurance Company, Kera Capital
Partners, Methodist Health System, NorthStandard Limited, Optima
Seguros, Perion Network Ltd, Point Biopharma Inc., and Westfield
Specialty, Ltd.
- Clearwater Analytics announced that RiverStone International, a
leading global nonlife run-off insurance business specialist and
the largest provider of legacy solutions in the Lloyd's market,
successfully implemented the Clearwater platform. Selected for its
investment accounting and reporting capabilities, the Clearwater platform today automates and
streamlines RiverStone's data consolidation, investment accounting,
trade reconciliation, and reporting processes. In addition,
Clearwater Analytics announced that Bank of Saint Lucia chose Clearwater JUMP to power its
new mutual fund. By implementing Clearwater's solution for the investment
lifecycle, which includes reconciliation and data aggregation
capabilities, investment accounting, and NAV & CRM tool, Bank
of Saint Lucia has a comprehensive
solution that fits their needs. With Clearwater JUMP, Bank of
Saint Lucia will have an asset
management operations platform, empowering them to scale rapidly.
The bank aims to grow significantly in size within the next year,
positioning itself as a leading financial institution in the
Eastern Caribbean.
- Clearwater won the Captive
Review US Award for the second year in a row, clinching top honors
in the Software Solution of the Year category. In addition,
Clearwater Analytics was named to the IDC FinTech Rankings 2023 in
the Top 50 and the Emerging FinTech lists.
Fourth Quarter and Full Year 2023 Guidance
|
Fourth Quarter
2023
|
|
Full Year
2023
|
|
Revenue
|
$98.5
million
|
|
$367.6
million
|
|
Year-over-Year Growth
%
|
~19%
|
|
~21%
|
|
Adjusted
EBITDA
|
$28 million
|
|
$104 million
|
|
Adjusted EBITDA Margin
%
|
~28%
|
|
~28%
|
|
Equity-based
compensation expense and related payroll taxes
|
|
|
~$80 million
|
|
Equity-based
compensation expense related to JUMP Technology
acquisition
|
|
|
~$25 million
|
|
Depreciation and
Amortization
|
|
|
~$9 million
|
|
Non-GAAP effective tax
rate
|
|
|
25 %
|
|
Diluted non-GAAP share
count
|
|
|
~255 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
November 1, 2023, at 5:00 p.m. Eastern time to discuss third quarter
2023 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
$6.4 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,
risk factors related to the Company's acquisition of JUMP
Technology, including the Company's ability to (i) successfully
integrate the operations and technology of JUMP Technology with
those of the Company, (ii) retain and incentivize the management of
JUMP Technology, and (iii) retain the clients of JUMP Technology,
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, 2022 filed on
March 3, 2023, 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)
|
|
|
September
30
|
|
December
31
|
|
2023
|
|
2022
|
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
205,665
|
|
$
250,724
|
|
Short-term
investments
|
79,568
|
|
4,890
|
|
Accounts receivable,
net
|
91,656
|
|
72,575
|
|
Prepaid expenses and
other current assets
|
24,341
|
|
28,157
|
|
Total current
assets
|
401,230
|
|
356,346
|
|
Property and equipment,
net
|
14,804
|
|
15,064
|
|
Operating lease
right-of-use assets, net
|
22,940
|
|
24,114
|
|
Intangible assets,
net
|
26,037
|
|
29,456
|
|
Goodwill
|
42,585
|
|
43,791
|
|
Long-term
investments
|
17,600
|
|
—
|
|
Deferred contract
costs, non-current
|
5,636
|
|
6,563
|
|
Other non-current
assets
|
4,675
|
|
6,608
|
|
Total assets
|
$
535,507
|
|
$
481,942
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
$
2,853
|
|
$
3,092
|
|
Accrued expenses and
other current liabilities
|
40,779
|
|
42,119
|
|
Notes payable, current
portion
|
2,750
|
|
2,750
|
|
Operating lease
liability, current portion
|
6,402
|
|
5,851
|
|
Tax receivable
agreement liability, current portion
|
10,355
|
|
12,200
|
|
Total current
liabilities
|
63,139
|
|
66,012
|
|
Notes payable, less
current maturities and unamortized debt issuance costs
|
46,494
|
|
48,492
|
|
Operating lease
liability, less current portion
|
17,678
|
|
19,505
|
|
Tax receivable
agreement liability, less current portion
|
8,200
|
|
—
|
|
Other long-term
liabilities
|
8,561
|
|
9,547
|
|
Total
liabilities
|
144,072
|
|
143,556
|
|
Stockholders'
Equity
|
|
|
|
|
Class A common stock,
par value $0.001 per share; 1,500,000,000 shares authorized,
88,848,638 shares issued and outstanding as of September 30, 2023,
61,148,890 shares issued
and outstanding as of December 31, 2022
|
89
|
|
61
|
|
Class B common stock,
par value $0.001 per share; 500,000,000 shares authorized,
1,402,185
shares issued and outstanding as of September 30, 2023, 1,439,251
shares issued and
outstanding as of December 31, 2022
|
1
|
|
1
|
|
Class C common stock,
par value $0.001 per share; 500,000,000 shares authorized,
39,337,746
shares issued and outstanding as of September 30, 2023, 47,377,587
shares issued and
outstanding as of December 31, 2022
|
39
|
|
47
|
|
Class D common stock,
par value $0.001 per share; 500,000,000 shares authorized,
113,173,596
shares issued and outstanding as of September 30, 2023, 130,083,755
shares issued and
outstanding as of December 31, 2022
|
113
|
|
130
|
|
Additional
paid-in-capital
|
516,485
|
|
455,320
|
|
Accumulated other
comprehensive income (loss)
|
(500)
|
|
609
|
|
Accumulated
deficit
|
(190,599)
|
|
(186,647)
|
|
Total stockholders'
equity attributable to Clearwater Analytics Holdings,
Inc.
|
325,628
|
|
269,521
|
|
Non-controlling
interests
|
65,807
|
|
68,865
|
|
Total stockholders'
equity
|
391,435
|
|
338,386
|
|
Total liabilities and
stockholders' equity
|
$
535,507
|
|
$
481,942
|
|
Clearwater Analytics
Holdings, Inc.
Consolidated
Statements of Operations
(In thousands,
except share amounts and per share amounts,
unaudited)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
Revenue
|
$
94,664
|
|
$
76,552
|
|
$
269,149
|
|
$
220,739
|
|
Cost of
revenue(1)
|
27,013
|
|
22,720
|
|
78,792
|
|
64,811
|
|
Gross profit
|
67,651
|
|
53,832
|
|
190,357
|
|
155,928
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Research and
development(1)
|
32,250
|
|
25,438
|
|
90,198
|
|
69,568
|
|
Sales and
marketing(1)
|
15,020
|
|
13,187
|
|
44,049
|
|
38,254
|
|
General and
administrative(1)
|
26,268
|
|
16,371
|
|
75,445
|
|
46,864
|
|
Total operating
expenses
|
73,538
|
|
54,996
|
|
209,692
|
|
154,686
|
|
Income (loss) from
operations
|
(5,887)
|
|
(1,164)
|
|
(19,335)
|
|
1,242
|
|
Interest (income)
expense, net
|
(1,733)
|
|
(693)
|
|
(4,422)
|
|
139
|
|
Tax receivable
agreement (benefit) expense
|
(566)
|
|
2,600
|
|
6,112
|
|
5,700
|
|
Other income,
net
|
(971)
|
|
(469)
|
|
(1,205)
|
|
(828)
|
|
Loss before income
taxes
|
(2,617)
|
|
(2,602)
|
|
(19,820)
|
|
(3,769)
|
|
Provision for (benefit
from) income taxes
|
(274)
|
|
424
|
|
(184)
|
|
959
|
|
Net
loss
|
(2,343)
|
|
(3,026)
|
|
(19,636)
|
|
(4,728)
|
|
Less: Net income (loss)
attributable to non-controlling interests
|
(472)
|
|
(52)
|
|
(2,440)
|
|
277
|
|
Net loss
attributable to Clearwater Analytics Holdings, Inc.
|
$
(1,871)
|
|
$
(2,974)
|
|
$
(17,196)
|
|
$
(5,005)
|
|
|
|
|
|
|
|
|
|
Net loss per share
attributable to Class A and Class D common stockholders
stock:
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
$
(0.01)
|
|
$
(0.02)
|
|
$
(0.09)
|
|
$
(0.03)
|
|
|
|
|
|
|
|
|
|
Weighted average shares
of Class A and Class D common stock outstanding:
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
201,582,951
|
|
187,824,531
|
|
197,903,361
|
|
184,026,378
|
|
|
(1) Amounts
include equity-based compensation as follows:
|
|
|
Cost of
revenue
|
$
3,346
|
|
$
2,594
|
|
$
8,837
|
|
$
7,281
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Research and
development
|
6,768
|
|
5,133
|
|
17,393
|
|
14,003
|
|
Sales and
marketing
|
4,010
|
|
2,941
|
|
11,221
|
|
9,452
|
|
General and
administrative
|
16,233
|
|
6,033
|
|
44,675
|
|
18,032
|
|
Total equity-based
compensation expense
|
$
30,357
|
|
$
16,701
|
|
$
82,126
|
|
48,768
|
|
Clearwater Analytics
Holdings, Inc.
Consolidated
Statements of Cash Flows
(In thousands,
unaudited)
|
|
|
Three Months Ended
September 30, 2023
|
|
Nine Months Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
OPERATING
ACTIVITIES
|
|
|
|
|
|
|
|
|
Net loss
|
$
(2,343)
|
|
$
(3,026)
|
|
$
(19,636)
|
|
$
(4,728)
|
|
Adjustments to
reconcile net loss to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
2,476
|
|
1,381
|
|
7,336
|
|
3,499
|
|
Noncash operating
lease cost
|
1,898
|
|
1,891
|
|
5,667
|
|
5,226
|
|
Equity-based
compensation
|
30,357
|
|
16,701
|
|
82,126
|
|
48,768
|
|
Change in tax
receivable liability
|
(566)
|
|
2,600
|
|
6,122
|
|
5,700
|
|
Amortization of
deferred contract acquisition costs
|
1,212
|
|
1,154
|
|
3,563
|
|
3,221
|
|
Amortization of debt
issuance costs, included in interest expense
|
71
|
|
71
|
|
210
|
|
210
|
|
Deferred tax
benefit
|
(314)
|
|
(106)
|
|
(524)
|
|
(590)
|
|
Accretion of discount
on investments
|
(502)
|
|
—
|
|
(901)
|
|
—
|
|
Realized gain on
investments
|
—
|
|
—
|
|
(89)
|
|
—
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
(8,966)
|
|
(9,648)
|
|
(18,864)
|
|
(15,051)
|
|
Prepaid expenses and
other assets
|
4,759
|
|
1,563
|
|
4,219
|
|
1,618
|
|
Deferred contract
acquisition costs
|
(1,376)
|
|
(1,478)
|
|
(2,662)
|
|
(3,593)
|
|
Accounts
payable
|
9
|
|
661
|
|
109
|
|
240
|
|
Accrued expenses and
other liabilities
|
4,983
|
|
2,916
|
|
(6,171)
|
|
(4,673)
|
|
Net cash provided by
operating activities
|
31,698
|
|
14,680
|
|
60,505
|
|
39,847
|
|
INVESTING
ACTIVITIES
|
|
|
|
|
|
|
|
|
Purchases of property
and equipment
|
(770)
|
|
(1,912)
|
|
(4,062)
|
|
(5,880)
|
|
Purchase of held to
maturity investments
|
—
|
|
—
|
|
—
|
|
(3,000)
|
|
Purchases of
available-for-sale investments
|
(19,334)
|
|
—
|
|
(111,018)
|
|
—
|
|
Proceeds from sale of
available-for-sale investments
|
—
|
|
—
|
|
5,950
|
|
—
|
|
Proceeds from
maturities of investments
|
10,275
|
|
—
|
|
13,517
|
|
—
|
|
Net cash used in
investing activities
|
(9,829)
|
|
(1,912)
|
|
(95,613)
|
|
(8,880)
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
|
|
|
|
Proceeds from exercise
of options
|
1,286
|
|
1,542
|
|
4,465
|
|
7,926
|
|
Taxes paid related to
net share settlement of equity awards
|
(6,440)
|
|
(2,564)
|
|
(14,887)
|
|
(2,564)
|
|
Proceeds from employee
stock purchase plan
|
—
|
|
—
|
|
2,595
|
|
2,401
|
|
Repayments of
borrowings
|
(688)
|
|
(688)
|
|
(2,062)
|
|
(2,063)
|
|
Payment of costs
associated with the IPO
|
—
|
|
—
|
|
—
|
|
(214)
|
|
Payment of tax
distributions
|
(35)
|
|
(17)
|
|
(35)
|
|
(17)
|
|
Net cash provided by
(used in) financing activities
|
(5,877)
|
|
(1,727)
|
|
(9,924)
|
|
5,469
|
|
Effect of exchange rate
changes on cash and cash equivalents
|
(543)
|
|
(1,164)
|
|
(27)
|
|
(2,510)
|
|
Change in cash and cash
equivalents during the period
|
15,449
|
|
9,877
|
|
(45,059)
|
|
33,926
|
|
Cash and cash
equivalents, beginning of period
|
190,216
|
|
278,646
|
|
250,724
|
|
254,597
|
|
Cash and cash
equivalents, end of period
|
$
205,665
|
|
$
288,523
|
|
$
205,665
|
|
$
288,523
|
|
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION
|
|
|
|
|
|
|
|
|
Cash paid for
interest
|
$
310
|
|
$
151
|
|
$
2,530
|
|
$
766
|
|
Cash paid for income
taxes
|
$
416
|
|
$
939
|
|
$
1,484
|
|
$
1,425
|
|
NON-CASH INVESTING
AND FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
Purchase of property
and equipment included in accounts payable and accrued
expense
|
$
2
|
|
$
162
|
|
$
2
|
|
$
162
|
|
Tax distributions
payable to Continuing Equity Owners included in accrued
expenses
|
$
3,838
|
|
$
1,646
|
|
$
3,838
|
|
$
1,646
|
|
Clearwater Analytics
Holdings, Inc.
Reconciliation of
Net Loss to Adjusted EBITDA
(In thousands,
unaudited)
|
|
|
Three Months Ended
September 30,
|
|
2023
|
|
2022
|
|
(in thousands,
except percentages)
|
|
Net loss
|
$
(2,343)
|
|
(2 %)
|
|
$
(3,026)
|
|
(4 %)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Interest (income)
expense, net
|
(1,733)
|
|
(2 %)
|
|
(693)
|
|
(1 %)
|
|
Depreciation and
amortization
|
2,476
|
|
3 %
|
|
1,381
|
|
2 %
|
|
Equity-based
compensation expense and related payroll taxes
|
25,642
|
|
27 %
|
|
16,701
|
|
22 %
|
|
Equity-based
compensation expense related to JUMP acquisition
|
5,583
|
|
6 %
|
|
—
|
|
—
|
|
Tax receivable
agreement (benefit) expense
|
(566)
|
|
(1 %)
|
|
2,600
|
|
3 %
|
|
Transaction
expenses
|
61
|
|
0 %
|
|
1,327
|
|
2 %
|
|
Other (benefit)
expenses(1)
|
(564)
|
|
(1 %)
|
|
559
|
|
1 %
|
|
Adjusted
EBITDA
|
28,556
|
|
30 %
|
|
18,849
|
|
25 %
|
|
Revenue
|
$
94,664
|
|
100 %
|
|
$
76,552
|
|
100 %
|
|
|
Nine Months Ended
September 30,
|
|
2023
|
|
2022
|
|
(in thousands,
except percentages)
|
|
Net loss
|
$
(19,636)
|
|
(7 %)
|
|
$
(4,728)
|
|
(2 %)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Interest (income)
expense, net
|
(4,422)
|
|
(2 %)
|
|
139
|
|
— %
|
|
Depreciation and
amortization
|
7,336
|
|
3 %
|
|
3,499
|
|
2 %
|
|
Equity-based
compensation expense and related payroll taxes
|
67,823
|
|
25 %
|
|
48,768
|
|
22 %
|
|
Equity-based
compensation expense related to JUMP acquisition
|
16,594
|
|
6 %
|
|
—
|
|
—
|
|
Tax receivable
agreement expense
|
6,112
|
|
2 %
|
|
5,700
|
|
3 %
|
|
Transaction
expenses
|
1,612
|
|
1 %
|
|
1,327
|
|
1 %
|
|
Other
expenses(1)
|
504
|
|
— %
|
|
2,081
|
|
1 %
|
|
Adjusted
EBITDA
|
75,923
|
|
28 %
|
|
56,786
|
|
26 %
|
|
Revenue
|
$
269,149
|
|
100 %
|
|
$
220,739
|
|
100 %
|
|
|
|
(1)
|
Other (benefit)
expenses includes management fees to our investors, income taxes,
foreign exchange gains and losses and other expenses that are not
reflective of our core operating performance including the costs to
set up our Up-C structure and Tax Receivable Agreement, and
transaction expenses including legal, accounting, and other
expenses related to the Secondary Offering.
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
(in
thousands)
|
|
Up-C structure
expenses
|
$
—
|
|
$
—
|
|
$
—
|
|
$
158
|
|
Amortization of prepaid
management fees and reimbursable expenses
|
681
|
|
604
|
|
1,894
|
|
1,792
|
|
Provision for (benefit
from) income tax expense
|
(274)
|
|
424
|
|
(184)
|
|
959
|
|
Other income,
net
|
(971)
|
|
(469)
|
|
(1,205)
|
|
(828)
|
|
Total other (benefit)
expenses
|
$
(564)
|
|
$
559
|
|
$
504
|
|
$
2,081
|
|
Clearwater Analytics
Holdings, Inc.
Reconciliation of
Free Cash Flow
(In thousands,
unaudited)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
Net cash provided by
operating activities
|
$
31,698
|
|
$
14,680
|
|
$
60,505
|
|
$
39,847
|
|
Less: Purchases of
property and equipment
|
770
|
|
1,912
|
|
4,062
|
|
5,880
|
|
Free Cash
Flow
|
$
30,928
|
|
$
12,768
|
|
$
56,443
|
|
$
33,967
|
|
Clearwater Analytics
Holdings, Inc.
Reconciliation of
Non-GAAP Information
(In thousands,
except share amounts and per share amounts,
unaudited)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
Revenue
|
$
94,664
|
|
$
76,552
|
|
$ 269,149
|
|
$ 220,739
|
|
|
|
|
|
|
|
|
|
Gross profit
|
$
67,651
|
|
$
53,832
|
|
$ 190,357
|
|
$ 155,928
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related payroll taxes
|
3,589
|
|
2,594
|
|
9,324
|
|
7,281
|
|
Depreciation and
amortization
|
1,994
|
|
863
|
|
5,897
|
|
2,197
|
|
Gross profit,
non-GAAP
|
$
73,234
|
|
$
57,289
|
|
$ 205,578
|
|
$ 165,406
|
|
As a percentage of
revenue, non-GAAP
|
77 %
|
|
75 %
|
|
76 %
|
|
75 %
|
|
|
|
|
|
|
|
|
|
Cost of
Revenue
|
$
27,013
|
|
$
22,720
|
|
$
78,792
|
|
$
64,811
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related payroll taxes
|
3,589
|
|
2,594
|
|
9,324
|
|
7,281
|
|
Depreciation and
amortization
|
1,994
|
|
863
|
|
5,897
|
|
2,197
|
|
Cost of revenue,
non-GAAP
|
$
21,430
|
|
$
19,263
|
|
$
63,571
|
|
$
55,333
|
|
As a percentage of
revenue, non-GAAP
|
23 %
|
|
25 %
|
|
24 %
|
|
25 %
|
|
|
|
|
|
|
|
|
|
Research and
development
|
$
32,250
|
|
$
25,438
|
|
$
90,198
|
|
$
69,568
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related payroll taxes
|
6,738
|
|
5,133
|
|
17,186
|
|
14,003
|
|
Equity-based
compensation expense related to JUMP acquisition
|
348
|
|
—
|
|
1,058
|
|
—
|
|
Depreciation and
amortization
|
255
|
|
396
|
|
786
|
|
878
|
|
Research and
development, non-GAAP
|
$
24,909
|
|
$
19,909
|
|
$
71,168
|
|
$
54,687
|
|
As a percentage of
revenue, non-GAAP
|
26 %
|
|
26 %
|
|
26 %
|
|
25 %
|
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
$
15,020
|
|
$
13,187
|
|
$
44,049
|
|
$
38,254
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related payroll taxes
|
4,196
|
|
2,941
|
|
11,772
|
|
9,452
|
|
Depreciation and
amortization
|
143
|
|
67
|
|
441
|
|
199
|
|
Sales and marketing,
non-GAAP
|
$
10,681
|
|
$
10,179
|
|
$
31,836
|
|
$
28,603
|
|
As a percentage of
revenue, non-GAAP
|
11 %
|
|
13 %
|
|
12 %
|
|
13 %
|
|
|
|
|
|
|
|
|
|
General and
administrative
|
$
26,268
|
|
$
16,371
|
|
$
75,445
|
|
$
46,864
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related payroll taxes
|
11,119
|
|
6,033
|
|
29,541
|
|
18,032
|
|
Equity-based
compensation expense related to JUMP acquisition
|
5,235
|
|
—
|
|
15,536
|
|
—
|
|
Depreciation and
amortization
|
84
|
|
55
|
|
212
|
|
225
|
|
Amortization of
prepaid management fees and reimbursable expenses
|
681
|
|
604
|
|
1,894
|
|
1,792
|
|
Transaction
expenses
|
61
|
|
1,327
|
|
1,612
|
|
1,327
|
|
Up-C structure
expenses
|
—
|
|
—
|
|
—
|
|
158
|
|
General and
administrative, non-GAAP
|
$
9,088
|
|
$
8,352
|
|
$
26,651
|
|
$
25,330
|
|
As a percentage of
revenue, non-GAAP
|
10 %
|
|
11 %
|
|
10 %
|
|
11 %
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
$
(5,887)
|
|
$
(1,164)
|
|
$ (19,335)
|
|
$
1,242
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related payroll taxes
|
25,642
|
|
16,701
|
|
67,823
|
|
48,768
|
|
Equity-based
compensation expense related to JUMP acquisition
|
5,583
|
|
—
|
|
16,594
|
|
—
|
|
Depreciation and
amortization
|
2,476
|
|
1,381
|
|
7,336
|
|
3,499
|
|
Amortization of
prepaid management fees and reimbursable expenses
|
681
|
|
604
|
|
1,894
|
|
1,792
|
|
Transaction
expenses
|
61
|
|
1,327
|
|
1,612
|
|
1,327
|
|
Up-C structure
expenses
|
—
|
|
—
|
|
—
|
|
158
|
|
Income from operations,
non-GAAP
|
$
28,556
|
|
$
18,849
|
|
$
75,924
|
|
$
56,786
|
|
As a percentage of
revenue, non-GAAP
|
30 %
|
|
25 %
|
|
28 %
|
|
26 %
|
|
|
|
|
|
|
|
|
|
Net loss
|
$
(2,343)
|
|
$
(3,026)
|
|
$ (19,636)
|
|
$
(4,728)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Equity-based
compensation expense and related payroll taxes
|
25,642
|
|
16,701
|
|
67,823
|
|
48,768
|
|
Equity-based
compensation expense related to JUMP acquisition
|
5,583
|
|
—
|
|
16,594
|
|
—
|
|
Depreciation and
amortization
|
2,476
|
|
1,381
|
|
7,336
|
|
3,499
|
|
Tax receivable
agreement (benefit) expense
|
(566)
|
|
2,600
|
|
6,112
|
|
5,700
|
|
Amortization of
prepaid management fees and reimbursable expenses
|
681
|
|
604
|
|
1,894
|
|
1,792
|
|
Transaction
expenses
|
61
|
|
1,327
|
|
1,612
|
|
1,327
|
|
Up-C structure
expenses
|
—
|
|
—
|
|
—
|
|
158
|
|
Tax impacts of
adjustments to net loss(1)
|
(7,815)
|
|
(5,803)
|
|
(20,388)
|
|
(16,668)
|
|
Net income,
non-GAAP
|
$
23,719
|
|
$
13,784
|
|
$
61,347
|
|
$
39,848
|
|
As a percentage of
revenue, non-GAAP
|
25 %
|
|
18 %
|
|
23 %
|
|
18 %
|
|
|
|
|
|
|
|
|
|
Net income per share -
basic, non-GAAP
|
$
0.12
|
|
$
0.07
|
|
$
0.31
|
|
$
0.22
|
|
Net income per share -
diluted, non-GAAP
|
$
0.09
|
|
$
0.06
|
|
$
0.24
|
|
$
0.16
|
|
|
|
|
|
|
|
|
|
Weighted-average common
shares outstanding - basic
|
201,582,951
|
|
187,824,531
|
|
197,903,361
|
|
184,026,378
|
|
Weighted-average common
shares outstanding - diluted
|
255,494,034
|
|
248,934,095
|
|
256,998,500
|
|
249,613,673
|
|
|
|
(1)
|
The estimated non-GAAP
effective tax rate was 25% and 29% for the three and nine months
ended September 30, 2023 and 2022, 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.