Clearwater Analytics (CWAN) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue was $221.2 million, up 74% year-over-year, driven by organic growth, acquisitions, and GenAI adoption.

• Net loss attributable to shareholders was $2.8 million, compared to net income of $6.5 million in Q1 2025, mainly due to acquisition-related expenses and increased amortization.

• Major acquisitions of Enfusion, Beacon, and Bistro in 2025 expanded product offerings and client base.

• Shareholders approved a definitive merger agreement in May 2026, with closing expected in Q2 2026, pending final regulatory approval.

• Annualized recurring revenue grew 77% year-over-year to $872 million as of March 31, 2026.

Financial highlights

• Gross profit increased to $145.5 million from $92.9 million year-over-year; non-GAAP gross profit was $172.7 million with a 78.1% margin.

• Adjusted EBITDA was $77.4 million (35% margin), up 72% year-over-year.

• Operating expenses rose to $136.6 million, reflecting higher payroll, amortization, and equity-based compensation.

• Cash, cash equivalents, and investments totaled $81.5 million as of March 31, 2026; total debt was $806.4 million.

• Operating cash flow was $17.7 million; free cash flow was $11.2 million in Q1 2026.

Outlook and guidance

• The merger with an investor group led by Permira and Warburg Pincus is expected to close in Q2 2026, pending final regulatory clearance.

• No forward-looking guidance provided due to the pending acquisition.

• Management expects continued growth from cross-selling, international expansion, and onboarding of new clients.