--- title: "Clearwater Analytics | 10-Q: FY2026 Q1 Revenue Beats Estimate at USD 221.23 M" type: "News" locale: "en" url: "https://longbridge.com/en/news/285620232.md" datetime: "2026-05-07T21:07:17.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/285620232.md) - [en](https://longbridge.com/en/news/285620232.md) - [zh-HK](https://longbridge.com/zh-HK/news/285620232.md) --- # Clearwater Analytics | 10-Q: FY2026 Q1 Revenue Beats Estimate at USD 221.23 M Revenue: As of FY2026 Q1, the actual value is USD 221.23 M, beating the estimate of USD 216.35 M. EPS: As of FY2026 Q1, the actual value is USD -0.01, beating the estimate of USD -0.0269. EBIT: As of FY2026 Q1, the actual value is USD 21.64 M. Clearwater Analytics Holdings, Inc. operates as one operating segment, offering a SaaS solution for automated investment data aggregation, reconciliation, accounting, and reporting services . #### Revenue For the three months ended March 31, 2026, total revenue was $221,228 thousand, marking a 74% increase from $126,864 thousand in the corresponding period of 2025 . This growth was attributed to an expanded customer base, both organically and through acquisitions, and changes to existing clients’ assets on the platform . Geographic revenue for the three months ended March 31, 2026, included $162,363 thousand from the United States and $58,865 thousand from the Rest of World . In the prior year, geographic revenue for the three months ended March 31, 2025, was $102,937 thousand from the United States and $23,927 thousand from the Rest of World . #### Gross Profit and Cost of Revenue Gross profit for the three months ended March 31, 2026, was $145,547 thousand (66% of revenue), compared to $92,940 thousand (73% of revenue) for the same period in 2025 . Cost of revenue increased by $41,757 thousand, or 123%, to $75,681 thousand (34% of revenue) for the three months ended March 31, 2026, from $33,924 thousand (27% of revenue) in 2025 . Key drivers for this increase included higher depreciation and amortization ($19,231 thousand), payroll and related costs ($13,572 thousand), data costs ($4,735 thousand), technology costs ($1,442 thousand), facility costs ($1,119 thousand), and equity-based compensation ($859 thousand) . #### Operating Expenses Research and development (R&D) expenses rose by $19,650 thousand (53%) to $57,050 thousand (26% of revenue) for the three months ended March 31, 2026, from $37,400 thousand (29% of revenue) in 2025 . This was mainly due to increased payroll and related costs ($15,923 thousand), technology costs ($2,432 thousand), and outside services and contractors costs ($1,178 thousand), partially offset by a decrease in equity-based compensation (-$1,633 thousand) . Sales and marketing expenses increased by $26,610 thousand (136%) to $46,241 thousand (21% of revenue) for the three months ended March 31, 2026, from $19,631 thousand (15% of revenue) in 2025, driven primarily by higher payroll and related costs ($12,313 thousand), depreciation and amortization ($6,143 thousand), and equity-based compensation ($4,784 thousand) . General and administrative (G&A) expenses grew by $4,439 thousand (15%) to $33,266 thousand (15% of revenue) for the three months ended March 31, 2026, from $28,827 thousand (23% of revenue) in 2025 . This increase was mainly from payroll and related costs ($2,185 thousand), technology costs ($1,242 thousand), and equity-based compensation ($853 thousand), partially offset by a decrease in outside services and contractors (-$1,956 thousand) . #### Net Income (Loss) The company reported a net loss of -$2,796 thousand for the three months ended March 31, 2026, a shift from a net income of $6,936 thousand for the same period in 2025 . This change was largely attributed to one-time acquisition-related expenses, amortization of acquired intangibles, and increased interest expense from debt . #### Interest Expense Interest expense significantly increased to $12,646 thousand for the three months ended March 31, 2026, from $919 thousand in 2025, primarily due to new borrowings under the 2025 Credit Agreement . #### Other Income, Net Other income, net decreased to -$51 thousand for the three months ended March 31, 2026, from -$2,323 thousand in 2025, mainly due to the utilization of surplus funds for acquisitions and fluctuations in foreign exchange . #### Provision for (Benefit from) Income Taxes The company recorded a benefit from income taxes of -$809 thousand for the three months ended March 31, 2026, compared to a provision of $1,550 thousand in 2025, reflecting a pretax loss in 2026 . #### Cash Flow Net cash provided by operating activities was $17,675 thousand for the three months ended March 31, 2026, a decrease from $24,500 thousand in 2025 . This was influenced by a net loss adjusted by non-cash charges and a decrease in changes in operating assets and liabilities, including payments of accrued bonus and increased deferred contract costs . Net cash used in investing activities was -$6,440 thousand for the three months ended March 31, 2026, primarily for purchases of property, equipment, and software . In contrast, the company had net cash provided by investing activities of $99,525 thousand in 2025, mainly from proceeds from the sale and maturities of investments in preparation for acquisitions . Net cash used in financing activities was -$19,248 thousand for the three months ended March 31, 2026, primarily due to repayment of borrowings and tax withholding related to equity awards . In 2025, net cash used was -$27,249 thousand, mainly for tax withholding on equity awards and debt issuance costs . #### Key Operating Measures Annualized Recurring Revenue (ARR) was $871,814 thousand as of March 31, 2026, increasing 76.5% from March 31, 2025, driven by an increase in clients and expansion of existing client assets . The gross revenue retention rate was 97% as of March 31, 2026, compared to 98% in 2025, consistently remaining at least 98% in 27 of the past 29 quarters . The net revenue retention rate as of March 31, 2026, was 108%, down from 114% as of March 31, 2025 . Excluding the effects from acquired entities, net revenue retention was 111% in the first quarter of 2026 . #### Outlook/Guidance Clearwater Analytics Holdings, Inc. is currently undergoing a proposed merger to be acquired by an investor group for approximately $8.4 billion . Shareholders adopted the merger agreement on May 6, 2026, and all required regulatory approvals have been obtained except for the Australia Foreign Investment Review Board (FIRB) approval . Subject to FIRB approval and other customary closing conditions, the merger is expected to close in the second quarter of 2026, after which the company’s common stock will be delisted from the NYSE . ### Related Stocks - [CWAN.US](https://longbridge.com/en/quote/CWAN.US.md) ## Related News & Research - [Clearwater Analytics (NYSE:CWAN) Releases Earnings Results](https://longbridge.com/en/news/285645733.md) - [Clearwater Analytics Holdings, Inc. $CWAN Shares Bought by Principal Financial Group Inc.](https://longbridge.com/en/news/274973657.md) - [Clearwater Analytics beats Q1 revenue estimates](https://longbridge.com/en/news/285616035.md) - [Clearwater Analytics Buyout Nears Finish Line With New Ownership Story](https://longbridge.com/en/news/285701735.md) - [RBC Capital Reaffirms Their Hold Rating on Clearwater Analytics Holdings (CWAN)](https://longbridge.com/en/news/281972362.md)