Guidewire Software Inc (GWRE)
Pretax margin
| Jul 31, 2025 | Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before tax but after interest (EBT) | US$ in thousands | 49,395 | -26,838 | -134,094 | -229,715 | -104,281 |
| Revenue | US$ in thousands | 1,202,460 | 980,497 | 905,341 | 812,614 | 743,267 |
| Pretax margin | 4.11% | -2.74% | -14.81% | -28.27% | -14.03% |
July 31, 2025 calculation
Pretax margin = EBT ÷ Revenue
= $49,395K ÷ $1,202,460K
= 4.11%
The pretax margin of Guidewire Software Inc. exhibits significant fluctuations over the period from July 31, 2021, to July 31, 2025. Initially, the company reported a negative pretax margin of -14.03% in July 2021, indicating that pre-tax income was a substantial loss relative to revenues. This negative margin deepened in July 2022 to -28.27%, suggesting an even larger pre-tax loss as a proportion of revenues. Subsequently, by July 2023, the pretax margin improved to -14.81%, reflecting a partial recovery but still remaining in negative territory.
The trend continued with a notable positive shift by July 2024, where the pretax margin decreased to -2.74%, approaching break-even conditions. By July 2025, the pretax margin turned positive, reaching 4.11%, indicating that the company moved into profitability on a pre-tax basis.
Overall, the progression demonstrates a substantial reduction in losses over the analyzed period, transitioning from deeper negative margins to a positive pretax margin, which may suggest improving operational efficiency, revenue growth, or cost management strategies. Nonetheless, despite the positive turn in 2025, the margin remains relatively modest, emphasizing a cautious optimism regarding the company's profitability trajectory.