Guidewire Software Inc (GWRE)
Return on equity (ROE)
| Jul 31, 2025 | Apr 30, 2025 | Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Net income (ttm) | US$ in thousands | 69,804 | 34,612 | -16,857 | 30,107 | -6,103 | -10,642 | -50,732 | -69,608 | -111,855 | -155,105 | -166,981 | -198,473 | -180,431 | -150,433 | -129,622 | -97,593 | -66,507 | -26,700 | -21,105 | -32,397 |
| Total stockholders’ equity | US$ in thousands | 1,457,230 | 1,362,580 | 1,268,740 | 1,268,030 | 1,342,730 | 1,285,370 | 1,256,110 | 1,205,650 | 1,199,470 | 1,195,110 | 1,220,170 | 1,185,160 | 1,451,660 | 1,449,650 | 1,480,470 | 1,498,380 | 1,544,890 | 1,556,480 | 1,644,660 | 1,659,860 |
| ROE | 4.79% | 2.54% | -1.33% | 2.37% | -0.45% | -0.83% | -4.04% | -5.77% | -9.33% | -12.98% | -13.69% | -16.75% | -12.43% | -10.38% | -8.76% | -6.51% | -4.30% | -1.72% | -1.28% | -1.95% |
July 31, 2025 calculation
ROE = Net income (ttm) ÷ Total stockholders’ equity
= $69,804K ÷ $1,457,230K
= 4.79%
The analysis of Guidewire Software Inc.'s return on equity (ROE) over the period from October 2020 to July 2025 reveals a significant evolution in the company's profitability and equity efficiency. Initially, the ROE was negative, with values ranging from -1.95% in October 2020 down to a low of -16.75% in October 2022. This persistent negative trend indicates that the company was not generating sufficient net income relative to shareholders' equity during this period, reflecting potential challenges in profitability or substantial investments impacting earnings.
Between October 2022 and October 2024, the ROE exhibited a gradual improvement, moving from -16.75% to -0.45%. This shift suggests a steady narrowing of the negative equity return, implying that the company was in the process of recovering profitability or restructuring operations to better utilize shareholder capital.
Notably, a turning point occurred around October 2024, where the ROE transitioned into positive territory at 2.37%. This positive ROE indicates that the company began generating net income sufficient to effectively leverage shareholders’ equity, signaling enhanced operational performance and potential strategic improvements. Subsequent data points show continued positive movement, with the ROE rising to 4.79% in July 2025, suggesting sustained profitability and improved efficiency in generating returns for shareholders.
Overall, the trend demonstrates a significant recovery from a prolonged period of negative returns, culminating in a positive and improving ROE in the recent periods. This transformation underscores an enhancing financial performance and a potential shift towards better profitability and value creation for shareholders.