October 7, 2020 - The case was voluntarily dismissed.

July 24, 2020 - An investor in shares of Guidewire Software, Inc. (NYSE: GWRE) filed a lawsuit in the U.S. District Court for the Northern District of California over alleged violations of Federal Securities Laws by Guidewire Software, Inc. in connection with certain allegedly false and misleading statements made between March 6, 2019 and March 4, 2020.

San Mateo, CA based Guidewire Software, Inc. provides software products for property and casualty (“P&C”) insurers worldwide. Guidewire Software, Inc. reported that its Total Revenue rose from $661.06 million for the 12 months period that ended on July 31, 2018, to $719.51 million for the 12 months period that ended on July 31, 2019, and that its Net Loss of $19.66 million for the 12 months period that ended on July 31, 2018 turned into a Net Income of $20.73 million for the 12 months period that ended on July 31, 2019.

On March 4, 2020, Guidewire Software, Inc. announced its financial results for the second quarter of 2020. Guidewire Software, Inc. was forced to slash its revenue guidance for fiscal year 2020 by $57 million, from a range of $759 million to $771 million down to $702 million to $714 million. Rather than forecasting a year-over-year revenue increase of up to 7% for fiscal 2020, the Company was now forecasting a substantial revenue decline of approximately 7.5%. The Company similarly lowered its critical ARR guidance to be between 11% and 12% in fiscal 2020, compared to its previous range of 14% to 16%.

Shares of Guidewire Software, Inc. (NYSE: GWRE) declined from $124.16 per share on February 19, 2020 to as low as $71.64 per share on April 3, 2020.

According to the complaint the plaintiff alleges on behalf of purchasers of Guidewire Software, Inc. (NYSE: GWRE) common shares between March 6, 2019 and March 4, 2020, that the defendants violated Federal Securities Laws.

The plaintiff claims that the Defendants represented to investors that Guidewire was well-positioned to capitalize on a shift in the P&C insurance industry away from on-premise software systems to software systems provided over the cloud. Defendants touted the “robust” demand that existed for Guidewire’s cloud-based products and assured investors that customer demand was “enduring and broad-based across most or all segments of the market.”

The plaintiff alleges that the defendants further touted the demand for Guidewire’s cloud offering by reporting, at the end of each quarter, that cloud sales represented a substantial and growing percentage of the Company’s overall sales. The Company also issued highly favorable revenue and Annual Recurring Revenue (“ARR”) guidance, and assured investors that customer demand remained strong across the Company’s entire product offering, including its legacy on-premise business.

More specifically, the plaintiff claims that between March 6, 2019 and March 4, 2020, the demand for Guidewire’s cloud products was weak and the Company’s transition to the cloud was not going well because Guidewire’s cloud-based products needed to be significantly improved to meet customer needs and catch-up with rival systems, that Guidewire’s failed transition to the cloud was damaging the Company’s traditional on-premise business, as customers delayed purchasing decisions or declined to renew existing licenses, and that Guidewire’s revenue guidance, including guidance principally based on significantly increasing demand for the Company’s cloud-based products, was baseless and unattainable.