Clearwater Analytics (CWAN) 21 Feb 232022 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by and welcome to the Clearwater Analytics Fourth Quarter and Full Year 2022 Financial Results Conference Call. [Operator Instructions] And now, I would like to welcome Joon Park, Head of Investor Relations to begin the conference.

Thank you and welcome everyone to Clearwater Analytics fourth quarter and full year 2022 financial results conference call.

Joining me on the call today are Sandeep Sahai, Chief Executive Officer and Jim Cox, Chief Financial Officer. After their remarks, we will open the call to a question-and-answer session.

Securities remind statements that the are provisions the to call, this Safe like of of forward-looking Act any made Private would all during participants conference Harbor XXXX. I Reform Litigation pursuant to statements. than Expressions to believe future performance, of reflect and limitation, using expressions, and for will, identify may, other without financial the including which future terminology business historical items, can, expectations intended including expressions goals, forward-looking facts outlook, are similar expect something and

involve of Factors in those of conference law. that required events SEC. number statements The discussed no to in materially after our call, arise the company except may as including Forward-looking and uncertainties, statements. obligation differ revise a risks with any to may the section by Actual this statements or order reflect forward-looking undertakes forward-looking from update Risk results filings any

earnings in For cautionary statement more included refer the information, press release. to our please

A unless assessed metrics we on all noted. Relations release to press the have Lastly, be website. are posted that our this non-GAAP, found earnings Investor in otherwise reconciliation call can

With that, the I our over Sandeep Officer, will Chief Executive to turn Sahai. call

and Joon, welcome, everyone. you, Thank

profit quarter. and insurers Revenue compelling revenue chose share to XX.X%. with more platform. we full of start I because XXX both will this XX.X% of X margin free hope XX flow Net to Clearwater retention very the quarter. stayed are execution. largest QX. for was is the revenue cash Gross in $XX.X for in And of the Gross was XXXX. in QX in the straight delighted retention days to QX results for million Let’s last agree, That, generated America year the XX.X%. XXXX, you move North XXth the numbers full for We EBITDA grew to the robust year XX% XXX%. at climbed

our Looking the be more of proud not at back could team. year, I

headwinds strong. was faced challenges which and believe firms, just know, executed other the didn’t I effectiveness you we like of throughout all the very the urgency And fintech faced. we and As with reacted we address and year, we

made more resilient customers model. stronger we by commercial to fact, working our a craft our modified In with and business

renewed in commitment plan, overall accomplished to our XXXX, building technology, we our approach the time. we and product our have what test confidence disruptive that Given our will stand of customer-centric strategy

five into Let’s the business. fundamentals continue and the September we dig guide we us, them in When XXXX. build IPO deeper to out little completed throughout pillars of a XXXX, we our to laid upon

them unchanged. Year, which update the on the provide in we of to platform, the for This invest own want is is pillar ever-increasing growth. predictability platform. pillars, those want an growth long are Given number And already one an we term. New who consistent, grow. choose is those and reason. good and We in first our want medium very to important to our Consistency largely clients for Pillar to reliable our to a number our ability and durable

growth. XX.X%. of XXXX allows and of to $XX.X which team to growth and the to time challenges booking plans, expect we our forward testament was a QX, challenging beginning full the million in booking of is $XXX.X to out year the XX% to XXXX had of resiliency strong look budget was another with represented year in accomplishment us for navigate laid business of in This revenue they to confidence year million, exceeded QX revenue year-over-year That the the arise. XX% we ability the our in With as deliver year. and Our and turbulent the

guide and and our specifically, we our More will the will to economy the agile We in continue to market look watch response. and conditions our booking vigilant remain continued investments. to

addressable total sizable Pillar market. two is our number

sizing always with GTM lot are the rigor it. have of opportunity approach We determined of by our the investments a because market

market, and TAM built our view submarkets and of $XX geographies billion plus. We have detailed market previously a have by opportunity communicated of a

team we to our further on work using a validate to consulting to refine firms basis, leading continuous own with this validate estimate. this addition In and

importantly, an areas TAM investments our in to with More current expansion. easy have enhance continue that long TAM be It service define to R&D is can they content adjacencies markets, help us is finding ongoing but the our basis. we the of runway on ongoing for in in

systems, enhances billion related Technology. to only $X effort this is actions double us of presence, and office our deliver acquisition logos and including XXXX does with Not our went of our platform in also new capture proof XXX is our of year clients. example new order by JUMP by calendar to on current allowing front An TAM portfolio and to European ability them. it management it our live

Homestead insurers two and earlier, from spoke System, Advisors, Robinson In customer large we about Rygel, Management. QX Advisers Payden & Investment addition Meeder Capital Health Corp, to the Management, Bimini our include Adventist Management WestCap new wins

Just a few. to name

to This platform to and comes reconciled in, pillar Geographically, PT where legacy our across Singapore, in portfolio geographies. in we Avallis continue daily moats. in we competitive view and encouraged organizations joined These deep of Indonesia. cases, is MSIG these Asuransi with solutions we the third a in growing with our MSIG comprehensive are signed Asia QX, in trying competitive replace group continued get Insurance of our and of successes our classes Asia, In in asset majority clients Investments Australia. early Thailand and the next-generation and

Across That’s together view a that they And systems asset the fact. industry, have when to see given multiple focused operations have bring class to that function a or and the with a deal all narrowly for on to who teams businesses. like to geography, of a a are face risk. want challenges assets. business business real the given They comprehensive investment they deliver just the

on all reporting and need Operations there regulations manage Then data ingest track quality. time. and deliver team to regulatory is requirements. They to keep of and that have and ever-changing reconcile of

truly a platform accounting software next-generation been multi-tenant The architecture that that of for upgrades. the and industry keeps technology regulations the pace industry. proven updated is time-consuming results instance the changes obviating value constantly in with has single and after need costly Our architecture single-instance in in

longer simply come who no our every watch to of following on for the advice of competitor years. Clearwater. I that us left rely and recently asked They the have year. tens talking out client they alerts thousands compliance need and said regulatory Clients regulation was been joined why. They to

conclusion landscape. data benefit into baked it our they they is Multi-tenancy to So came the the quality from that would changing being software.

Since reconcile their own that the to we having and are of everyone. a fosters platform for our do or allows we ingest client network content Our effect complacent each position. once data, not about for data it highest quality. But

in level in to that we before moat. further invest to continue of years. invested We XXXX revenue in of to product deepen competitive moderating in continue In investment plan our XX% this R&D our XXXX, subsequent and

portfolio Prism offer to management we order Clearwater life alongside Moving full a additional pillar, core. Clearwater that as We first was offer best-in-class Today, core, in Clarity, used to us, to management. greater can to JUMP of Plus, And Clearwater Clearwater and we commercial investment OMS, which believe add-on unit-linked PMS, products investment LPx, acceptance, to the market. Clearwater be market continue which Clearwater Clearwater Performance get Clearwater predominantly adjacent JUMP cycle. R&D multiple and will but us offering. products, When has our expanded fourth you evolve can continued continues and build modules, product independently bring for single product allows be we used model. that the company, LPx funds. sustained for met a Clearwater Clearwater

one take one, Let’s by with Prism. starting them

We announce allow data combined comply calculations reports and Prism. with Nationwide Clearwater reporting The that Management Clearwater platform perform and generate X Morgan JP regulatory the with data a Management and of Prism in are obligation. to series Asset Asset and use validations daily chose clients, proud QX, of aggregates largest that to to our Clearwater JPMorgan

significant Europe, to of to for use for Prism deal This are AUM. also clients, signed our end in reporting to Prism billion clients. client first share will generate have over expanding that We X-figure excited $XXX in able offering be representing our largest our one their we

is JUMP. Next

the management market. that asset XXXX. JUMP Lux Luxembourg-based Vie, provider, Jump win regulatory This combination look and compliance sold insurance we We recall, demonstrates of client As new you December, European of key will and an November attractive in Vie. is to Clearwater the we to JUMP offering to acquisition and needs. forward platform closed Cardif investment the Lux Cardif the the supporting performance, reporting constitutes In with

expect additional attracted core product offering. also customers We markets combined to be our to in our

and module performance LPx. Clearwater traction with on than LPx, teams XXXX. clients in Clearwater funds brings existing solutions limited Clearwater we standalone the addition integrated In products well partnerships adjacent more logos development us the can and existing defined and and our offering Clearwater have to integrated for is XX received added focused we product gaining JUMP’s like unit-linked new clients net We in to clients, Clearwater products for enhanced LPx products to and back so market. an feature-rich that JUMP both offer which offerings, to being

selected them the can long-term it deep popularity, investments, helps by solution private understand you returns. providing is dig need being organizations visibility the tell into the because its their As rising equity to of

was create product and investment with to takes it underlying analytics. risk impact and unstructured now further beyond. front-office to Prism revenue. exposure offerings is clients’ our our similarly first in data other including Clarity structure product, and provide We expect starting to LPx increasingly higher expanded one it bookings convert Clearwater to look-through, step meaningful adjacent teams and deliver XXXX and portfolio data to our

final Clearwater’s of business the in the tech the won fact, we from numerous again Insurance delivered on impact of The Award Excellence rests In Year acknowledge Asia QX, Technology profound in ensure QX, U.S., to delight. towards best overall on do. has Europe InsuranceAsia everything impact Provider our any receive the delight. value client Asset work The the to always global That the we it that year the fifth in XX%. our We an the Redtech awards, won’t satisfaction pillar Management. teams POST clients, testament approach. working heart hard industry. are is in simply and a and singular from and value ultimate operations is Clearwater the Insurance best our and In platform investment Pacific goal for client’s Truly, These to News, the client client-centric and of score client of excess region. of at tech Tech Solution the the the NPS the this is the from of that having as Firm Clearwater is

to respectively. innovation, for awards CHRO CMO happy that are and marketing the HR report both and in won We Clearwater’s leadership

many impact forward, our how looking you ask of Now to might conditions macroeconomic business. expect we

growing are we are laying reacting Rather, We line business. not by with our in off. people

We are not we cutting corners Rather, consistently investing. are in R&D.

not But We through the of afraid the economy are watchful or we to expand are geographically acquisition. rest markets. assured, and

by economic our our led platform, higher have happen to bookings stand offering coming durable not in by on our our might be enhancing product or steadfast dedication what XXXX, reliable, consistent, might that weathering will about forecasts innovating or proven quarters. culture, not have SaaS We even TAM, our focus on in approach growth, resiliency We except has we Little and and conviction. the philosophy, after clients. therefore, changed and pillars,

updated performance to Before our quarter quarter returning our as provide and to Financial financial with for Chief XXXX. hand year as closing like full year Cox, now thoughts, would on full to Jim over and well fourth the few our details first call more Officer, guidance a I

all items results you unless our spend the on closed November basis to few plan the of results report of from guidance. our us. our adjusted include XX, otherwise tax on will note by for a year JUMP TRA model, receivable the base plus financial XXXX since to and rewarding is JUMP summarizing the or It be the which results. acquisition, providing impact QX transition to on and or XXXX thank joining and a then you update our noted. color the full that discussed then the non-GAAP Sandeep, on explain time our Please and I Thanks, of QX acquisition agreement expense, conclude continued and results progress our of

Vie, a revenue the year-on-year such delivered from to top challenging revenue European growth the perpetual Turning to guidance. combination JUMP We In market which to million was of was in scale million. Cardif closed $X.X QX metrics with proud $X.X XX.X% included environment. included of were JUMP’s quickly. expected December, million revenue and otherwise provided and and was we a and me full higher that success we that license especially with Clearwater’s drive XXXX results, which when functionality $XX.X with roughly XXXX start in XXXX, line in revenue QX achieved than Lux million happy have revenue $XXX.X are agreement our an client QX revenue. revenue so year JUMP’s we see the QX December. large let

XXXX of Annualized other comprises recurring vertical of vertical with corporates, to million ARR. end The of revenue, December acquisition. was ARR on included The or ARR, $XXX.X the government $X.X million XXXX. December comprises XX% XX% at the XX% JUMP insurance and ARR and management asset entities XX, of comprising related

decline increases and prices $X.X reflects Clearwater significant from growth income December of rates This that by XXXX. trillion interest from of trillion clients the platform, offset on the As clients in lower assets throughout up XX, end the existing and in daily, new market fixed and than XXXX, $X.X caused increase more at processes XXXX. equity reports from the the business

a The business gross model has transition satisfaction which XXth XXX%. be our XXX% The for retention best-in-class net the increased bedrock revenue continues quarter. quarter, had retention XX% led impact an on straight the bottom to commercial nice to industry-leading customer revenue from fourth our the we shows net has approach, client-focused QX uptick positive our the in our predicted of retention to revenue of and In business. XXX%,

more highlight transition. relation Let our in me commercial to model

and of volatility on fixed fee, subject we assets are which on historically revenue fee plus assets the a high-grade assets, for significant we of clients A includes very with had the reminder, income levels our platform. model. a prospective We equity existing for commercial manage of income to platform business, structure base plus predictable both low our streams framework As assets primarily have the a contracted on of and to platform, first now plus. our increases base clients they led base minimums. evaluated market charged we transitioned A in a XXXX, as incremental majority fixed described in in the based to framework our historically book contract significant the half fee the volatility contracting an on

or $XXX,XXX us model subsequently base and supplemental those that annual the annual client The contracts with fees. to This in fee the plus has base base utilize should charge services additional structure fees increases services. the for select includes additional to since XXX% effect plus I products am enables of base plus to limiting model. new in our the of expected in revenue using happy commercial downside our asset-based volatility July, clients share are greater the than

our made commercial significant across also portfolio. client We progress the terms with existing

ARR solution exceptional In able XX.X% We did target point have to and our XXXX, simply to changes agreed basis This in contracts. not these their increases precisely be modify representing we existing these goals. price clients. with a not on clients of either if client contracts is servicing market-leading make or would for

a have model. customer plus majority the we Going new aim to forward, base vast contracts on of

base clients to the engage with Additionally, transition we plus remaining them continue to model. will to the

maintain AUM-based Within client pricing portion our base, to of model. plan an small do we one

have asset their historically be clients an growth. of to on largest Our Clearwater relied management enabler

our NRR. For were growth those NRR clients, consistently their than rates reported higher

will For with those clients, their continue to clients on grow. those focus we as assets growing

$X.X basis full in company. XXXX, better with over that quarter EBITDA our which was performance, our million. let’s turn EBITDA resulted as the a margin as was QX, EBITDA public more a our public first and reported hiring from the We profitability. a year improvement in QX $XX.X for XXXX QX were midpoint combined guidance XX.X% a which EBITDA million first as Now XX.X% company. year the to of for margins exceeded by cautious $XX.X for both in full margin year, million our point full XX approach revenue

million XX.X%. Singapore, where Australia, as UK France, Gross Hong onboarding we the the at our execute profit growth, even to Japan, continues Gross and on quarter continue in Thailand, new are margin to Netherlands operations and margin in building markets, Kong, international was a $XX.X name in few. gross came including for resilient clients to in client investment we be

million XX.X% an expenses $XX.X These and revenue, or or from $X.X quarter quarter of a in increase $XX.X the revenue, were General QX. efficiency from of successfully QX. expenses our $XXX,XXX of marketing the the $X.X strong in also while were expenses results decrease focus million million QX. increase continuing revenue, administrative were or and from X.X% of JUMP. reflect and an Research and Sales million of execution on $X.X integrating in of quarter development million XX.X%

regulatory talk closing JUMP. our began and well for doubles our solution JUMP investment European efforts teams provide up extending the life XXX Let’s about existing merge in functionality joint full JUMP like described. single ramps business development of or integrating investment After our Europe, of into cycle as offering JUMP process the presence acquisition reporting, as on industry. with performance to to a the our with expansion we XX, and Sandeep creation our Clearwater functions, management our employees efforts over the to November as providing clients

opportunities have order current for add already their Clearwater existing performance the We to trade clients reporting to and solution. management enhance

corps in We’re bringing Clearwater of shows historically solution ARR. and JUMP’s also cloud, solution for consistent product offering Clearwater. harmonize about hypothesis not be to this year-end, $X.X merging book tremendously results plan and the Throughout be At million with a combined their had because the excited the a been recorded team. to a GAAP. U.S. IFRS, and into addition model, unit-linked in perpetual where under go-to-market the prospects business has rest license to JUMP revenue will teams validates acquisition their for our celebrated funds recurring XXXX, also we the JUMP investment their by the of and will esprit European the de number JUMP

generally product will motion, report we U.S. GAAP selling JUMP to results and the Given the integration, separately. not transition joint

recurring XX% As to half in layer structure, the model, into our the transition first XXXX revenues consolidated business we cost XXXX then less than the expect reduce revenue to EBITDA continue margins will to margins financials. of we JUMP JUMP increase Since and our of overall new from compared XXXX. a is EBITDA JUMP expect improve to in migrate recurring as we the overall margins

tax $XX.X our lieu you’ll Receivable in and subject incurred QX expense These we see the expense, deductions TRA. tax that the when $X.X in to Tax Moving million receivable Agreement utilize expenses we to in expense for tax incurred of million are year. agreement

we primarily pretax a the tax Although compensation R&D income the of we would stock-based deductions. have reported taxable loss, of Absent had GAAP capitalization in and XXXX, because expenses lower Up-C structure and $XX by XXXX. Tax TRA not Agreement, operating tax Receivable the in would of the income cash million. expense increased estimate flow The we have did expense recording that impact

expect in XXXX QX to related pay the the liability XXXX. have we to to expense However,

cash and $X still Let’s XX% expenditures. the cash was quarter cash, included QX, turn million, XXXX, investments the flow. of conversion with $XX.X million cash and in $X.X equivalents million to the JUMP the acquisition cash end reflecting balance approximately million. EBITDA $XX.X flow with was sheet capital of $XXX of ended We free higher cash million total than to short-term at the cash short-term flow for $XXX.X equivalents quarter at cash, debt, resulting end investments in Free the of of fourth XXXX. a and ending and in million net in Even and holdings

guidance. to let’s turn Now

advance hired For in growth. of we most of our XXXX,

new growth For XXXX, expansion business growth. we expect XXXX. our Therefore, EBITDA to tightly margin more our modest headcount we align in plan to

million, year approximately full to representing the growth. of be year-over-year XX% For expect in range $XXX to million the XX% $XXX we to revenue XXXX,

million in $XX $XX points million, the EBITDA expect margin. We to XXXX adjusted basis EBITDA our is be adjusted better range than which of to XX the

we equity-based equity-based $XX be as XXXX, compensation of is XXXX, expect For to expected million. approximately to decrease a percentage compensation After revenue.

shares. tax full JUMP expense expected XXX be full to non-GAAP expected to to project million. to share Equity-based effective million year compensation $XX year the acquisition related is And We count be rate expected Depreciation non-GAAP be to diluted be XX%. approximately and amortization approximately approximately is our $X million. is

the be guidance the quarter $XX In to impacted on for margin recurring and is QX, revenue XXXX, an first we revenue. $XX transition we be EBITDA This of to adjusted to by million EBITDA adjusted Focusing JUMP expect expect of million. XX%.

QX Additionally, merit EBITDA margin. impact annual increases the

expand in year in logos, of resulting for margins in years, we year. XXXX, year with we a to throughout into plans. As margin XXXX, same: previous of growth the integrating execution XXXX further an our existing full to more the strong the new in logos, in After of expect JUMP look expansion forward expanding winning EBITDA

thoughts. it turn I’ll provide over Sandeep that, some to to closing With

and wins We your interest Thank with our appreciate capturing across was in on some that Despite with you, globe great XXXX market legacy enter came Clearwater are and momentum, demonstrating the just Jim. year record, strongest R&D and to environment, our uncertain impressive with renewed of opportunities to Analytics. how ended our deliver resilient TAM, clients. and a an the pressures client confidence drive and growth as in We more business. we vendors, capture value XXXX innovation displace greater ability we technology

As supporting always, and as benefit focused long-term effect. powerful technology’s we clients’ on network from relentlessly they success our our them remain

me With over operator that, questions. the turn let for it to

of The [Operator line first the is Instructions] Jaluria with RBC. Rishi question from

proceed. You may

the the your ARR in so think one, numbers. then assuming kind year? can just that Number I’ve to back know, we that based I macro macro business. Wonderful. and Sandeep, I alongside start the that quick giving improves questions. the that. same stays understand that as follow-up. got by what you Hi, half are what a in XXXX, of you as Hi, really in for it on acceleration want and us in on you you Jim. gave X out my the mean, see the continued assumptions. had that, you growth taking helpful. outlook invest resilience for set be mentioned And really what Thanks of put Maybe Any the you And But about relative the next going you’re Nice – on is to help up confidence year, points to depending guidance not bookings QX? Sandeep. playing on to much us see is I impressive you would for

you question. thank Yes. for Rishi, the

we the I so can would business, did then But minutes, be you think XX of get your proactively we to much really that out answer cover. say all want on have some We bit revenue ARR. that. to went for Before to of do when begin, but I was that helpful retention look there I our there a a question, And so of there quite it that good like gross to XX%. sort that thought Rishi, you at sense we just a have net – of just

And booking sort element the So revenue. know how me ability that And in builds is year, and indicator. hear the to done high. plans months. look come When the translates bookings understanding have what say, guide talk, from that and why we of revenue the us revenue for when of is project that up always really a actually to what about that will booking. booking really let forward Obviously, our the to going the good we that, you are is through at but not have booking investment, forecast that’s quite Jim because X we we last we’re exactly second booking you

it. how we think about So that’s

million and look to you the guidance other year last million one our delivered want go revenue do point at it you last Rishi, year $XXX $XXX.X was last $XXX back we last is But year. was we if to million. hard. year, make to challenges faced, February here I of With all from of also

million. it go to in Then we at the EBITDA million. If we million beginning $XX last the you guidance in look back was gave $XX.X $XX delivered year, of

really frankly, than all there of And So – face, headwinds do works we the we we we is guided I better to do would we thought think still but to, this numbers guidance. deliver well. model the

increases, really get about worse assumes And rates. Like in lot plan we increases it year. dramatic. going our it do a last increases much, like can macroeconomic we won’t expect of felt sort So do. but continued don’t improve very rate to but whole the year, feel the interest expect did last We condition current is strongly that dramatic interest not we we what are

We assume would not going nice tailwinds inflation to will to that our And abate. those you to those? those if add also happen, further business. be is Jim,

It’s great.

had I want a know you you ask? follow-up, did Rishi, you said to

Sorry.

just Yes, quick So a my very follow-up. apologies.

So that and a level? guidance, to of stock-based dilution, sort philosophically really kind a think that I speak drivers as you’re is I quickly appreciate environment. guiding of actually you. revenue. going like the level compensation. just more what maybe see which look dollar normalized are percent And you’re is of JUMP, a – to you level down in to guidance when of is you’ve of Thank right, a stripping bring come that at well done Can down your terms the great And SBC in what this to looks as kind internally I and low to of out to it of kind

look key stayed look consistent. share XXX metric to at think I you the non-GAAP flat, has Yes, year-over-year, it’s count at that That the when diluted right? is

So there through dilution that. really been any hasn’t

the of about was all stock-based think compensation, portion considered as obviously part business we As kind of isolated JUMP time. need we’ve combination, That that of that. to over but earn that they

why so going through And it’s compensation. that’s

down continue really it year that be compensation set year, across. guide across And stock-based the the feel like have sat reflects percentage flat granted expense. increasing to and of would well as our are static. trade-off kind all feel for we for in see going and for Again, and keep very we’re to Clearwater this looked awards year, to and our kind And look through where everyone we plus, committed how extended get really of – peers. our time. doing performed period XX% revenues therefore, of of drive XX%, relative trying grow with sit? And those to And consultants next locked stock-based that organization comp peers what compensation do leverage good numbers obviously, to to given the we’re that we shareholders. comfortable in growing And we where the to you very, when our and are we this with about landing we of related For we’re last we’re to our we additional incredibly a you’re

Wonderful. Thank guys. so much, you

Thank you Rishi. much, so

from line next The with you. Stanley. Faucette Thank James the question of is Morgan

You proceed. may

It’s James. some But modules any the their you provide us Appreciate incremental Prism you could you know both Michael the saw you on adoption. Prism in color ACV of specifically. question. on is terms taking give us on mentioned appreciate another the hoping directional for provided I some relative X-figure stand-alone guys. in there those color you I I was our color the expansion Hi, as wins JPM well you deals? of deal. as could of and

question. Hey, for was with. thank out Look, you first we went Prism the Michael, product the

wins so and JPMorgan And at these really Nationwide significant. really, are both

was the data to What to and home case, hard to a is Prism together, a many first that from to do had this So you’re on and the daily body daily a data the use it various to does or was there manually brings on right? from which deliver does written that sources, And report provide basis bring just basis. is bring pulls primary do basis. ingests, had together trying software. the it what the regulatory on time. question when spots it that the calculations is in together, and be reporting need, was situation all on they And a case, client So daily merge done

So Prism. that to way use is one

was one other about ARR really combination. The

your the systems is comprehensive some have is that. on Prism able of you view do assets not. And various how accounting Clearwater get kinds, do all question you of of to So a and some

initially, is, of we and deals And think about Michael have were call. here for Now today now million seen of, us in or thing announced that one ARR and Europe, deals we seeing interesting the of the $XXX,XXX this $XXX,XXX we talked Prism ARR. in we I just $X excess in

rest become more Prism are products, the of growing the impact like we So you have booking more we of both on if and product infancy, talked feel significant The with a in they you will. about, which which have has ARR.

in and to time take XXXX and – start XXXX And deliver before XXXX so they XXXX. those will in still

the adopting difference Great, about are the longer-term of should Maybe your customers that’s those now we now really the new or higher resistance model sort helpful. three some are base sort to just the those of potential think to of understand trying adopting of versus the that commanding plus from in between rate? – who the who fully? pricing, on a take customers wave who impact model to economics how are I’m transition

Yes.

NRR way out. is It the think base it and the just that the downside are impact that doesn’t out our overall. the we necessarily about out, numbers the model plus volatility volatility number takes playing way So

of so our we to clients. saw with half second of it’s just And and It about clients, XXX% this base kind all terrific and as – of that model. of of when the in we reflected feel adoption new contracts how all on all plus sense of were the been fantastic year made our the our makes large us the resonates

who managers they I asset we had typically are than reported. strategic typically what of mentioned, NRR those higher growing with, For larger kind we had rates as

helping go-to-market actively those have folks model we’re and businesses. grow where we so with source them And their also a

it And that. continue with perspective, from to align sense so to that just made

about around it’s the and finally would contracting more say customers impacts that to not to I I’m we that to answering as NRR use case sure get take the that. question, that rate, the that drive model or your So and

want. that base an to and on clearly about plus rate. to that that’s that get products necessarily modules adding for how this really of out They a take that business it’s will Prism, throw XXX%, of path about XXX% as environment So goal all company. really our current more the the spoke do business. and current is as about And aspirational move more we really plus we Sandeep think project, kind LPx just retention That’s really want and right? in getting increasing with and important what leverage the the importantly, out take of about model The additional for our that moving do revenue most net time. clients of base but the are we to quarter doesn’t think aspirationally reported The are us. number. feel asking reflective multiyear were Us us JUMP just a is to model, kind XXX% fourth of like there. Let’s

be that. able to do we’re building so capabilities the And to

add last Clearwater managers. their years and I how they been that’s the managers, X But years, of that’s they was the Michael, at us, allocated look businesses markets, if asset can what right? time, I So the just highest you some this. business fees, charge over resistance. Look, asset was to those did X in years the think to way for and the happened largest those costs we internally by if and driven have large X NRR there, AUM

was sub-segment? there So of was. Yes, that we with resistance spoke sort with them, there

like Jim don’t wanted but current the will why gone XXX%. that to that we’ve live of are we’ve know, the get we the representing would done so we I the details with said but provide to fine, NRR XX.X% to with try model anyway okay, this you ARR understand be that to I we because there. feel pushing say, And highest much, clients not

Thanks, great Sandeep Jim. color. That’s and

you. Thank

Thank is question from next with line you. Ele the JPMorgan. of The Smith

You may proceed.

it’s thank seem be year. for between breaking you my corporations past insurers, the for I to line appreciate much split and question. taking for asset in that managers pretty what been you the Hi, down

getting Moving from particular or share? verticals, place forward, be for you you do either Any beyond any may growth see of XXXX any that? the

thanks – are we to point. think good hear your it’s I Ella,

share all good the we verticals. – the are are think in I news we is gaining gaining

Prism asset segment. our our management. level, see is in in opportunity highest about those. TAM share so as to JUMP, change, our and business largest really greater be are And investments how as we quickly, important is our in percentages business. large and in that the has at been it’s we Insurance gaining continues about the well piece asset a each half in you of With both at these management TAM and of relatively just of look just and if And

to you And a so on as of into were to assume would kind asset percentage Sandeep? if margin kind think look you years overall ARR. would the of out I to as far that continue the the of future, multiple management increase future

Yes.

large change or top quarters insurers like two we quarter because insurers I some in two who deal very a these of see large think get the you in you announced actually XX. a more are may two

so expect may not And down, don’t you – in see segment. that every bubble win to but up and we

We win expect segment. in to every

in we expect which We in. in to REIT to we traditionally, haven’t market, expect win win won the

literally at if to industry. in every the to expect then TAM, continue of look one We there is you runway And grow them. each

So, there a not, need segment, right. isn’t we really go not to to are that hey, why going say, pushing

dedicated we so to are to and industry have teams specific And specific which size. a a

to is is on example, there for dedicated so to dedicated dedicated a a when large small a you team team And insurers. is and very small there insurers, team insurance, say insurers there

up So, the and we into dedicated it. have after each has one the broken the sub-segments, segments market going team and

of new about one much Great. That’s have any thoughts revenue very logos that come your question deeper guidance do XX% into little you higher helpful. me, Thank you. pricing? how digging XXXX, other And for a for versus from would

services as clients new products to adding increase would so. majority logos as additional absolutely, price to both come vast new business. Those could existing the and the So, well relative from be

more sense, onboarding. exact would than onboarded of XX% current – or either clients to are from XX% the we I give number, have we an we be don’t you a fully but just revenue yes, more whom So can Ella, have I think than that tell you

XX%, been exactly. on number these don’t in put XX%. have but I I do I won. XX%, want deals it So, it, know of excess to it a don’t will Is which know are be

happy it are back of magnitude. get to that to sort We But overall you. is

much. it. Appreciate so you Thank Great.

Thank you, Ella.

Borges Sachs. line Goldman of Thank you. The next question is with Gabriela from the

You proceed. may

you comments love Sandeep, on are the the really Give on Congrats current Clearwater enablement the afternoon. And be projects to follow-up customers. than maybe of into on the Thank on in willingness a budget you or office made if it asset business terms an tap your were allowing in that us specifically, that as to what use to viewed play past cases tied use let color invest? to our accounting I solely Good the front you you some is case, seeing can happen green you. perhaps allows that manager more whether to more quarter. business little tool? of

growth go Thank it’s and up some are important who out to the I is Gabriela seen it helps enabler. really because because question question. you provide a you would on deals and my of almost it reporting – And would for clients is is I under sign superior. that analytics really a tell about that as the agree pressure like Yes. cost think would why Clearwater what can always, is you, get for Clearwater. managers asset sort that

which I well think a many. many reporting do are products for asset there that software given class,

many are Gabriela, them. there think pitches geography. go sort is we us a of actually grow clients with for we to And I given which I into of provide think – with continue why

book of do on business with they will clients a asset when We client. bid go management with joint pitches a potential

that enabler probably is seen think but are. who not an we number And and function. online, they I to when that who appropriate found analysis as lost reporting why RFPs, lost so changes a asset a superior had name, they They There client aggregated other RFPs. superior they of of accounting be the had of growth, did just when they analytics. managers to really you had obviously And start reporting the one

if have that. they listen, Europe, reporting seven deal clients. they the always – XXXX if from what so you and won, which I the to us. And bought excess thought part why their at Prism look is in was go big at because Even look That’s announced talking we back it that are we in why I was you was in of about figures,

and days used days available in to to $XXX sent we they take matter Clearwater, So, assets. should ready come and be a to able should It client, that and they of generate their billion be of They to hours. online. and these reports get have to

why traction. if again, you but growth, get So proposition, as software, think think enabler as you like an not said, of of that’s the I we accounting an

you guide, year the that’s the on the a like clarification a Jim, the revenue that full that? in seeing half, transition? are of you a you implied is getting moving JUMP bit the pipeline acceleration And on plus the sense. back pieces to bookings today, makes for in the little that That function Just

Yes.

I line our flowing bookings into think and revenue it’s right. the the assets our item, onboarding QX QX of from

And so. is win $X.X That’s that. So to onboard the it’s XXXX. growth and they relatively we takes term business. ARR, first, There being for million But are major the as some in to business, onboard element as JUMP. obviously it we speaking, the grow, time the onboarded, impact from then the throughout transition those some assets well of

And XXXX. of that, really of second I half of little impact booking half the in and second booking the ‘XX have What on if is XXXX, could will add likely very and XXXX revenue. the QX to QX in Gabriela, impacts XXXX revenue

will pipeline matter, it most. matter the in last two quarters it but So, quarter. does the of matter, and on this vast does very a booking majority be course would Those of the three based

you. Thank sense. makes That

you, Thank Gabriela.

The is Fargo. next Thank David the with question from Wells you. line of Unger

You may proceed.

here. Alright. one Great. I will given to keep my taking just it for the very Thanks question. time much

at acquisition all that not or as some you make prepared but a obviously have you acquisitions. your that afraid cash Sandeep, I of you more remarks position, the just in JUMP, are beginning good financial you think mentioned. completed you at are – we point said net understand So, the to in the

you you private diligence offense. on companies your you the as seeing valuations believe that invest? this you in Can what market suggests elaborate are the due and it JUMP to to over on you your mentioned there on appetite XXX So, process. screened I are call, acquisition out relates

So, diligence you. the right due Thank are you through to love I going hear on just now. process more would

David. Thank that Yes. for you, question. Thank you

JUMP – be about to really excited got it’s look, are I – thought was we So JUMP.

of able around brand their take clients. to I it’s also can and but so current themselves for do, have think the JUMP employees just sort being world, our what for developed what they taken we the and not think of exciting, for I Clearwater,

modules. Our current clients need those

very about what to matters. us. can excited what wrote bring are But I we is down JUMP So, – what

the profitable. always is telling is grows bar Jim because think really have nicely, nicely high me, we really, be clean I a good business, going to

do that up, screw something So, not let’s right. to

is like, feel to So, to be hey, I high. the bar continue going

what one looking if So, helps geographically. us for, really is, it we then are expand

which right. the example, But that, with you like so if JUMP help For geographically or does does things is it REITs something us case this expand that. that in be, could market, of found should or the something in

one. that So, is

that second comprehensive. The one platform would be more something makes our

or And are clients. enough which So, another acquisitions. then if the were helpful would the would that well enough, deeply our which at we we third enough. but functionality value deeply wanted, clients don’t the if bringing they Well look be current area is, where is wrong do enough I probably term, – we like thing to feel in more

be form analytics helpful. example, of some would for So, really

clients unhappy. more it’s to current about really, are adding value So who

isn’t working – will accounting we investment that around of world. many, us acknowledge many, So, the many for all do clients

in coming think I to we that really can if interesting. process Clearwater, them would that on of be hit So,

It obviously we nicely. JUMP. is did So, just going

build right not have we we the think We goal found to sign And do happened acquisition. would what will a something look one, to But them I would would that wait. great. we aggressively that we that. one And if see we will this of I it, we there early – Cardiff do expect It in some start for is that’s frankly, like don’t December. But And say. was do done. deliver to or got year [ph] this the to results. we continue

of lot you. that appreciate Thank details, a Sandeep. I

you, David. Thank

Blair. from next Mielczarek The is the with of question Kamil William line you. Thank

may You proceed.

for a Great. modules. given over up-sell for to that full XX% think year up-sell? XX%, portfolio follow-up module on take ASP want I X someone some full Clearwater the X that we who the products to core can these I customer just taking strong buys plus average next at made it buys the the my years? the core of But side. Is difference investments, up-sell who how see R&D the about the Thanks impact platform question. suite? versus will an And understand how to percentage grow around commentary today, time that from you the looking the should of

this Jim, let that. me take is Sure. And

an grows. are these. about as already. So, base example, as the just accounting take the all we of you of all it’s those – are you I fee for important And the all charged let’s that’s okay. of your as At think And core doing and you think to when accounting LPx, being of LPs, the for that are Clearwater LPx doing platform, for part on

in a per you charge amount for of accounting LPx it Sandeep We LPx LP obviously, LPx about more functionality. the bit that LP functionality, those say, how Prism I understand on could depends just Now more spoke I this. broader that okay, into a was underlyings add and thousand the And then to do clarity, between would more as in instance a of that. little per seven-figure want reporting functionality, on robust to and/or the the incremental visibility through an and example deal. step and variability want let’s an that than be and few say those. dollars kind

circumstances depends just the the So, specific client. on of it

the so is derivatives the Sandeep. in LPs equities It always the the get value just and the income is and really can fixed The and processing. though the is the view LP you – comprehensive this biggest products. LP comes a Kamil, the value mortgages value and in not with whole are better. it accounting comprehensive real Yes, But comes I we from the can don’t to the see any look of where a you that’s that do better. ability. improve from. really And think through, portfolio we trying

Thanks helpful. very again. That’s

Kamil. you, Thank

Oppenheimer. Thank is next you. question with The Brian of line from Schwartz the

You may proceed.

Yes. funnel to quarters? just you Congratulations are also in of conversions with Sandeep, trends you the and Hi. seeing top the prior wanted of question. versus the Thank on comment you. the Thanks pace on quarter. taking the QX saw my you ask if for that could

you thank that question. for Brian, Yes.

time world always to we is – these we surprised. I think hear fall apart. we the the was bitten we will we we were but have QX being going forecasts, were But We by think a not follow that great. economic said just forecast, little got bookings, forecasts. Every because

cautious became in started we believe little to a Jim As a hiring really we really, well. said, bit did the we little forecast because and

much internally decided for indicator. no, us, we better say, now is have it’s we just So, follow booking, a are leading booking to going because to

do to of see Clearwater, to as just see is we we even to will grow, And smaller it. I see we for I to Clearwater. down something that I looking to me, like bit, right don’t am in re-evaluate. to I of journal, there little enough look it. mean report looking on with Brian, see people every there now, just signs But to though, we we a market But believe continue think pain wanting So, continuing so just very and the always at we want the And we see on continue continue absolutely. don’t – bookings see come we the do clients if quite sort funnel Do large absolutely. our yes, see do really yet. clients, don’t come softer

the Thank you for color.

Thank you, you. Thank Brian.

[Operator from Instructions] The of Kim Markets. the Loop question next with Capital is line Yun

You may proceed.

this will I great. make Okay, quick.

First, customers target on expect Just want two XX% going the change congrats quarters, that just have amazing. getting for to you mix plus Do specific just in for that if mix to you any forward? on much to target which is curious base your on what – XXXX? –

the that clients, of model the signed of was really on were up terrific new of base metric that larger So, plus was going our for contracts XXX% our all other – those forward. for clients kind

base model continue add we customers. as de the to plus those So, we is the add customers, facto that way

as And customers over so up. add will tick that gradually we obviously, time,

could go Okay. I ahead. Great. Maybe just –

No, go ahead, please.

mentioned squeeze give of just share in what’s of I like Can going Maybe a kind Asian Sandeep, are you you just go-to-market you are momentum more. the seeing in you could the us and terms market? Asia. lot getting the in momentum one in – there about that on

Yes. admit, to it. too much about I I must seem speak

because by I get think right. it, I we speak surprised it about

have don’t we – have in big a Europe. we office So,

in investments Europe. a We lot of have made

So, this we like, Europe are expected. okay, is goes we what when

still is now But we get very limited when surprised just there. we we we win have have be today, I think Asia, there. And an to team footprint. clear, what we operating have

We have a sales team.

acute. And simple. client. are Vietnam, it’s The full have regulatory We in American its you China, Every the pre-sales need. Asia, GAAP. have organization which client, a U.S. own team. more about has from Every is you there. guess if the is is But And we – which they I an got are has own you we problems country. what, now reporting its go country case not have have But think so country It’s a when think which GAAP. quite understood. different Asia, American for from different every If regulatory to when all from that’s India, needs different is Thailand different that’s

level, why our business intuitive solution in we somewhat like that an should the that’s size stronger be suggests. of more much the Asia. are excited at ours a need So, believe than we for And

so Great. Okay. you much solid congrats and quarter. Thank a on

you. Thank

the the I concludes Thank concluding to over you. like turn remarks. Q&A back call team for would session. the That to

interest for just your I our in Look, thank to want everybody company.

something just are always and We engagement. your build we trying appreciate to special here,

bit. over Thank all. little you thank I sorry you. ran So, am a just this

This call. Thank conference for today’s you joining. concludes

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