Guidewire's results improved this year. Revenue climbed 22.7% to $1.5 billion, gross margin reached 64.2%, and operating margin rose to 10.2% from 3.4% in the twelve months ended July 31, 2026.
Then look at the cash balance: $372.9 million, down 46.6% from a year earlier. The business generated $389.7 million in operating cash flow, up 29.5%, so the smaller cash pile was not the result of operations failing to produce cash. It was the result of where the cash went.
Guidewire spent $606.3 million repurchasing shares. It also paid more for acquisitions and strategic investments, while capital expenditures and capitalized software development costs rose. Diluted shares still edged down 0.6%, which is the part of the buyback visible in the share count.
Management described the investing change this way:
"The decrease in cash used in investing activities was primarily due to lower net purchases of available-for-sale securities transactions of $140.5 million, offset by a $12.9 million increase in the acquisition of strategic investments, an increase of $11.1 million in cash paid as purchase consideration for acquisitions, higher capital expenditures and capitalized software development costs of $10.6 million, and a decrease of $4.9 million in proceeds from the sale of strategic investments."
Guidewire, 2026 10-K, September 11, 2026.
In plain English, fewer purchases of marketable securities helped cash, but acquisitions, strategic investments, and higher development spending pulled the other way. Capex was still only 0.8% of revenue, so this was not mainly a hardware buildout.
The operating improvement itself was broad. Gross profit rose 26.0%, faster than revenue, while operating income jumped 264.9% to $149.9 million. Research and development increased 14.8% to $340.1 million, meaning the company expanded product spending while reporting a much wider operating margin.
Another part of the growth sits in billing and collections. Accounts receivable rose 37.7%, faster than revenue, and the company recorded $2.8 million more cash used in working capital. Guidewire also reported $438.8 million of deferred revenue, up from $344.8 million, while saying some subscription orders had billing schedules that lagged revenue recognition.
The 10-K gives the specific explanation for unbilled receivables:
"Unbilled accounts receivable, net increased by $9.2 million primarily due to the impact of subscription orders with ramped billing schedules where billings occur later than revenue recognition, and to a lesser extent, the timing of billing on certain services projects."
Guidewire, 2026 10-K, September 11, 2026.
That makes the cash question more precise. Guidewire is growing and converting more of that growth into operating profit, but part of the revenue is arriving before the related billing. The next disclosure needs to show whether that timing remains a feature of the subscription base or reverses as billing catches up.
There is another recurring variable in the numbers: foreign exchange. Guidewire recorded a $22.5 million currency loss in fiscal 2026, compared with a $16.7 million gain the year before, putting a meaningful swing inside other income and expense rather than operating revenue.
At the latest close, the shares were $140.03, and the company carried an enterprise-value-to-sales multiple of 9.4x. That leaves the filing with two visible facts and one unanswered question for Guidewire's next annual report: can the faster growth, wider margins, and stronger operating cash flow continue while cash deployment and billing timing remain this prominent?
Source: Guidewire Software 2026 Form 10-K filed September 11, 2026.