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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________________________________________
FORM 8-K
_____________________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 31, 2024
_____________________________________________________
Clearwater Analytics Holdings, Inc.
(Exact name of Registrant as Specified in Its Charter)
_____________________________________________________
Delaware001-4083887-1043711
(State or Other Jurisdiction
of Incorporation)		(Commission File Number)(IRS Employer
Identification No.)
777 W. Main Street
Suite 900
Boise, Idaho
83702
(Address of Principal Executive Offices)(Zip Code)
Registrant’s Telephone Number, Including Area Code: 208 433-1200
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
_____________________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of each exchange on which registered
Class A common stock, par value $0.001 per shareCWANNew York Stock Exchange LLC
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o


Item 2.02 Results of Operations and Financial Condition.
On July 31, 2024, Clearwater Analytics Holdings, Inc. (“Clearwater” or the “Company”) issued a press release announcing its results for the second quarter ended June 30, 2024. A copy of the press release is attached as Exhibit 99.1 to this current report on Form 8-K and is incorporated by reference herein.
The information in this current report on Form 8-K and the exhibits attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as expressly provided by specific reference in such a filing.
Clearwater is making reference to non-GAAP financial information in both the press release and its earnings call. Reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is contained in the attached press release.
Item 9.01 Financial Statements and Exhibits.
(d):The following exhibits are being filed herewith:
Exhibit NumberDescription
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Clearwater Analytics Holdings, Inc.
Date:July 31, 2024By:/s/ Jim Cox
Jim Cox, Chief Financial Officer


Exhibit 99.1
picture1a.jpg
Clearwater Analytics Announces Second Quarter 2024 Financial Results

Record Quarterly Revenue of $106.8 Million, Up 19% Year-Over-Year
Net Income of $0.3 Million; Adjusted EBITDA of $33.4 Million, Up 35% Year-Over-Year
Gross Revenue Retention Rate of 99%; Net Revenue Retention Rate of 110%
Annualized Recurring Revenue of $427.2 Million, Up 22% Year-Over-Year
Operating Cash Flows of $43.9 Million, Up 108% Year-Over-Year

BOISE, Idaho — July 31, 2024 — Clearwater Analytics Holdings, Inc. (NYSE: CWAN) (“Clearwater Analytics” or the “Company”), a leading worldwide provider of SaaS-based investment management, accounting, reporting, and analytics solutions, today announced its financial results for the quarter ended June 30, 2024.

“We had a very strong quarter where ARR grew 22% year on year, revenue grew 19% and adjusted EBITDA grew 35%. Gross revenue retention was 99% for a second successive quarter, which is a strong reflection of the value our platform provides to our customers. Unit economics continues to be strong and ahead of stated goals because of the power of the single instance, multi-tenant platform and the network effect it produces. We continue to be very excited about client and prospect receptivity to the new products we are developing, often in partnership with our clients. These co-development efforts improve client satisfaction, drive revenue growth and make our innovation more targeted. Finally, our free cash flows grew by 117% compared to the previous year,” said Sandeep Sahai, CEO at Clearwater Analytics. “Also in the second quarter, we completed the acquisition of an advanced analytics platform from Wilshire Advisors extending our capabilities in risk and performance. Looking further ahead, we continue to make meaningful investments in generative AI to drive responsiveness and completeness to customer requests, improve data quality and drive revenue growth. These financial results and continued client momentum make us enthusiastic about what lies ahead for Clearwater Analytics.”


Second Quarter 2024 Financial Results Summary

•Revenue: Total revenue for the second quarter of 2024 was $106.8 million, an increase of 18.8%, from $89.9 million in the second quarter of 2023.

•Gross Profit: Gross profit for the second quarter of 2024 increased to $76.9 million, which equates to a 72.0% GAAP gross margin, compared with gross profit of $62.9 million and GAAP gross margin of 70.0% in the second quarter of 2023. Non-GAAP gross profit for the second quarter of 2024 was $82.7 million, which equates to a 77.5% non-GAAP gross margin and an increase of 170 basis points over the second quarter of 2023.

•Net Income/(Loss): Net income for the second quarter of 2024 was $0.3 million, compared with net loss of $11.9 million in the second quarter of 2023.

•Adjusted EBITDA: Adjusted EBITDA for the second quarter of 2024 was $33.4 million, an increase of 34.7%, from $24.8 million in the second quarter of 2023. Adjusted EBITDA margin for the second quarter of 2024 was 31.3%, an increase of 370 basis points over the second quarter of 2023.

•Cash Flows: Operating cash flows for the second quarter of 2024 were $43.9 million. Free cash flows for the second quarter of 2024 were $42.4 million, an increase of 116.9%, from $19.6 million in the second quarter of 2023. Cash flows improved from both stronger income as well as positive working capital changes from better collections in the quarter.
•Net Loss Per Share and Non-GAAP Net Income Per Share attributable to Clearwater Analytics Holdings, Inc.: Net loss per basic and diluted share was less than $0.01 in the second quarter of 2024. Non-GAAP net income per basic share was $0.12, and non-GAAP net income per diluted share was $0.10 in the second quarter of 2024.



•Cash, cash equivalents, and investments were $297.6 million as of June 30, 2024. Total debt, net of debt issuance cost, was $47.9 million as of June 30, 2024.

Second Quarter 2024 Key Metrics Summary

•Annualized Recurring Revenue: As of June 30, 2024, annualized recurring revenue (“ARR”) reached $427.2 million, an increase of 22.2% from $349.5 million as of June 30, 2023.

ARR is calculated at the end of a period by dividing the recurring revenue in the last month of such period by the number of days in the month and multiplying by 365.

•Gross Revenue Retention Rate: As of June 30, 2024, the gross revenue retention rate was 99%, compared to 98% as of June 30, 2023.

Gross revenue retention rate represents annual contract value (“ACV”) at the beginning of the 12-month period ended on the reporting date less client attrition over the prior 12-month period, divided by ACV at the beginning of the 12-month period, expressed as a percentage. ACV is comprised of annualized recurring revenue plus contracted-not-billed revenue, which represents the estimated annual contracted revenue for new and existing client opportunities prior to revenue recognition.

•Net Revenue Retention Rate: As of June 30, 2024, the net revenue retention rate was 110%, compared to 110% as of March 31, 2024 and to 109% as of June 30, 2023.

Net revenue retention rate is the percentage of recurring revenue from clients on the platform for 12 months and includes changes from the addition, removal, or value of assets on our platform, contractual changes that have an impact to annualized recurring revenues and lost revenue from client attrition.
Recent Business Highlights

•Clearwater Analytics continued on its journey towards being a multi-product company and successfully drove cross-sell and upsell in the second quarter. Highlights include:

◦Clearwater PRISM clients, including Erste Asset Management GmbH and M&G Investments, have adopted Clearwater PRISM for enhanced client portal and reporting. Clearwater announced that Erste Asset Management GmbH, one of the leading asset managers in Central and Eastern Europe and managing €81.4 billion in assets, will leverage Clearwater PRISM to aggregate multi-asset client investment data, help increase asset flows and strengthen client service. M&G Investments, a leading international asset manager and part of M&G plc, selected Clearwater to automate investment management and regulatory reporting and support the complex needs of M&G’s global insurance clients. With a white-labeled version of Clearwater’s platform, M&G’s insurance clients will have access to an M&G web portal and rely on Clearwater PRISM for monthly report generation, providing M&G's insurance clients with a complete view of their investments and the ability to meet complex multi-basis accounting requirements.

◦A growing roster of clients use both Clearwater’s JUMP solution for OMS/PMS and Clearwater’s accounting and reconciliation solution. Clearwater Analytics announced that Galilee Asset Management ("Galilee AM") selected Clearwater Analytics as its enterprise standard for investment management. Galilee AM will deploy Clearwater Analytics to support its rapid growth and consolidate its activities after acquiring several investment management companies.

◦The Clearwater for Stable Value solution was selected by Franklin Templeton to help drive the growth of its stable value fund business. Clearwater for Stable Value will provide Franklin Templeton with scalable investment technology, daily portfolio insights, and stable value-specific capabilities to support its expansion into separate accounts and new mandates. Franklin Templeton’s team will leverage this enhanced technology to effectively handle the nuanced aspects of managing stable value funds, including complex fund structures, securities, and specialized accounting treatment.

◦Clearwater Analytics announced that AXA XL’s alternative capital team selected Clearwater to provide strategic support for a portion of its investment portfolio. As one of the world’s largest property and casualty re/insurers, AXA XL provides insurance and risk management products and services for mid-sized companies through to large multinationals, and reinsurance solutions to insurance companies


globally. Clearwater was chosen for its proven reliability, accuracy, and comprehensive ability to meet their complex accounting book of record and regulatory requirements, including customized general ledger entries.

•Clearwater Analytics hosted Clearwater Connect in London in the second quarter, where attendees gained valuable insight from top leaders in the industry, connected with over 150+ of their peers from around the world, and participated in expert-led discussions on topics such as trends in alternative investing, navigating regulations, managing investments in turbulent times and more. Clearwater announced the winners of its Client Awards, highlighting teams and firms that have achieved growth and operational excellence in investment accounting with Clearwater’s award-winning investment accounting platform. Company winners included Aegon AM, Antares, Aviva, Resolution Re, and RiverStone International.

•On the heels of our successful Clearwater Connect users’ conference, the Company plans to host another Clearwater Connect in Boise on September 17-18, 2024, where current and prospective users will have the opportunity to significantly enhance their knowledge of the world’s most comprehensive investment management, accounting, and reporting solutions.

•Clearwater Analytics published its 2024 Insurance Investment Outsourcing Report ("2024 IIOR"), the eleventh annual 'Yellow Pages' of insurance-focused asset managers and a go-to resource for insurance firms outsourcing investment management. The 2024 IIOR includes 70 asset managers and 12 investment consultants, the latter which are new for this year. This report is highly regarded in the industry and leveraged by numerous insurers to identify asset managers and consultants who focus on their space. The report shows the outsourcing trend continues to grow with $3.6 trillion in insurance AUM reported, and over $900 million of consultant assets under advisement.

•Clearwater Analytics announced the release of its 2024 State of Alternatives study. The report, encompassing over 230 executive participants from sectors including insurance, wealth and asset management, corporate and government entities, pensions and endowments with $10 trillion in assets under management (AUM), delivers an overview of the emerging trends, opportunities and challenges related to alternative investments. The 2024 State of Alternatives study highlighted key factors and developments — including that 55% of institutional investors plan to boost their alternative investments — that will shape the alternatives landscape over the short-, medium- and long- term. Per the study, respondents were unanimous about needing better resources and technology to efficiently manage alternative investments and mitigate the impact of regulatory and operational challenges.

•Clearwater Analytics won the RegTech Insight Europe Awards 2024 for Best ESG Regulatory Solution. This recognition highlights Clearwater’s commitment to simplifying ESG data collection, data analysis, risk management, disclosure and reporting for its growing base of global clients.

Third Quarter and Full Year 2024 Guidance
Third Quarter 2024Full Year 2024
Revenue$113 million to $114 million$442 million to $444 million
Year-over-Year Growth %~19% to 20%~20% to 21%
Adjusted EBITDA$36 million$140 million
Adjusted EBITDA Margin %~32%~32%
Total Equity-based compensation expense and related payroll taxes~$106 million
Depreciation and Amortization~$12 million
Non-GAAP effective tax rate25%
Diluted non-GAAP share count~258 million

Certain components of the guidance given above are provided on a non-GAAP basis only without providing a reconciliation to guidance provided on a GAAP basis. Information is presented in this manner because the preparation of such a reconciliation could not be accomplished without “unreasonable efforts.” The Company does not have access to certain information that would be necessary to provide such a reconciliation, including non-recurring items that are not indicative of the Company’s ongoing operations. The Company does not believe that this information is likely to be significant to an assessment of the Company’s ongoing operations.


Conference Call Details

Clearwater Analytics will hold a conference call and webcast on July 31, 2024, at 5:00 p.m. Eastern time to discuss second quarter 2024 financial results, provide a general business update, and respond to analyst questions.
A live webcast of the call will also be available on the Company’s investor relations website. Please visit investors.clearwateranalytics.com at least fifteen minutes prior to the start of the event to register, download and install any necessary audio software.
If you are unable to participate live, a replay of the webcast will be available following the conference call on the Company’s investor relations website, along with the earnings press release, and related financial tables.
About Clearwater Analytics 

Clearwater Analytics (NYSE: CWAN), a global, industry-leading SaaS solution, automates the entire investment lifecycle. With a single instance, multi-tenant architecture, Clearwater offers award-winning investment portfolio planning, performance reporting, data aggregation, reconciliation, accounting, compliance, risk, and order management. Each day, leading insurers, asset managers, corporations, and governments use Clearwater’s trusted data to drive efficient, scalable investing on more than $7.3 trillion in assets spanning traditional and alternative asset types. Additional information about Clearwater can be found at clearwateranalytics.com.

###

Investor Contact:
Joon Park | +1 415-906-9242 | investors@clearwateranalytics.com
Media Contact:
Claudia Cahill | +1 703-728-1221 | press@clearwateranalytics.com
Use of non-GAAP Information

This press release contains certain non-GAAP measures, including non-GAAP gross profit, non-GAAP gross margin, adjusted EBITDA, adjusted EBITDA margin, non-GAAP net income, non-GAAP net income per basic and diluted share, non-GAAP effective tax rate, diluted non-GAAP share count and free cash flow.

The non-GAAP measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies. However, the Company believes that this non-GAAP information is useful as an additional means for investors to evaluate its operating performance, when reviewed in conjunction with its GAAP financial statements. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with GAAP, and because these amounts are not determined in accordance with GAAP, they should not be used exclusively in evaluating the Company's business and operations. In addition, undue reliance should not be placed upon non-GAAP or operating information because this information is neither standardized across companies nor subjected to the same control activities and audit procedures that produce the Company's GAAP financial results.

The Company's non-GAAP statement of operations measures, including non-GAAP gross profit, non-GAAP gross margin, adjusted EBITDA, adjusted EBITDA margin, non-GAAP net income, non-GAAP net income per basic and diluted share, non-GAAP effective tax rate, diluted non-GAAP share count and free cash flow, are adjusted to exclude the impact of certain costs, expenses, gains and losses and other specified items that management believes are not indicative of its ongoing operations. These adjusted measures exclude the impact of share-based compensation and eliminate potential differences in results of operations between periods caused by factors such as financing and capital structures, taxation positions or regimes, restructuring, transaction expenses, impairment and other charges.
Please refer to the reconciliations of these measures below to what the Company believes are the most directly comparable measures evaluated in accordance with GAAP.
Use of Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s beliefs and


assumptions and on information currently available to management. Forward-looking statements include information concerning the Company's possible or assumed future results of operations, business strategies, technology developments, financing and investment plans, dividend policy, competitive position, industry, economic and regulatory environment, potential growth opportunities and the effects of competition. Forward-looking statements include statements that are not historical facts and can be identified by terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “aim,” “may,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “will,” “would” or similar expressions and the negatives of those terms, but are not the exclusive means of identifying such statements.

Forward-looking statements involve known and unknown risks, uncertainties, and other factors, many of which are beyond Clearwater Analytics’ control, that may cause the Company's actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks and uncertainties may cause actual results to differ materially from Clearwater Analytics’ current expectations and include, but are not limited to, the Company's ability to keep pace with rapid technological change and market developments, including artificial intelligence, competitors in its industry, the possibility that market volatility, a downturn in economic conditions or other factors may cause negative trends or fluctuations in the value of the assets on the Company’s platform, the Company's ability to manage growth, the Company's ability to attract and retain skilled employees, the possibility that the Company's solutions fail to perform properly, disruptions and failures in the Company's and third parties’ computer equipment, cloud-based services, electronic delivery systems, networks and telecommunications systems and infrastructure, the failure to protect the Company, its customers’ and/or its vendors’ confidential information and/or intellectual property, claims of infringement of others’ intellectual property, factors related to the Company's ownership structure and status as a “controlled company” as well as other risks and uncertainties detailed in Clearwater Analytics’ periodic public filings with the U.S. Securities and Exchange Commission (the “SEC”), including but not limited to those discussed under “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed on February 29, 2024, and in other periodic reports filed by Clearwater Analytics with the SEC. These filings are available at www.sec.gov and on Clearwater Analytics’ website.

Given these uncertainties, you should not place undue reliance on forward-looking statements. Also, forward-looking statements represent management’s beliefs and assumptions only as of the date of this press release and should not be relied upon as representing Clearwater Analytics’ expectations or beliefs as of any date subsequent to the time they are made. Clearwater Analytics does not undertake to and specifically declines any obligation to update any forward-looking statements that may be made from time to time by or on behalf of Clearwater Analytics.
###


Clearwater Analytics Holdings, Inc.
Consolidated Balance Sheets
(In thousands, except share amounts and per share amounts, unaudited)
June 30December 31
20242023
Assets
Current assets:
Cash and cash equivalents$190,095 $221,765 
Short-term investments67,819 74,457 
Accounts receivable, net97,220 92,091 
Prepaid expenses and other current assets27,577 27,683 
Total current assets382,711 415,996 
Property and equipment, net15,158 15,349 
Operating lease right-of-use assets, net28,084 22,554 
Deferred contract costs, non-current5,845 6,439 
Intangible assets, net34,607 26,132 
Goodwill72,245 45,338 
Long-term investments39,718 21,495 
Other non-current assets6,779 5,440 
Total assets$585,147 $558,743 
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable$2,962 $3,062 
Accrued expenses and other current liabilities49,844 49,535 
Notes payable, current portion2,750 2,750 
Operating lease liability, current portion7,696 6,551 
Tax receivable agreement liability16,749 18,894 
Total current liabilities80,001 80,792 
Notes payable, less current maturities and unamortized debt issuance costs45,183 45,828 
Operating lease liability, less current portion21,306 16,948 
Tax receivable agreement, less current portion6,500 — 
Other long-term liabilities3,486 5,518 
Total liabilities156,476 149,086 
Stockholders' Equity
Class A common stock, par value $0.001 per share; 1,500,000,000 shares authorized, 160,421,799 shares issued and outstanding as of June 30, 2024, 127,604,185 shares issued and outstanding as of December 31, 2023160 128 
Class B common stock, par value $0.001 per share; 500,000,000 shares authorized, 111,191 shares issued and outstanding as of June 30, 2024 and December 31, 2023— — 
Class C common stock, par value $0.001 per share; 500,000,000 shares authorized, 27,424,288 shares issued and outstanding as of June 30, 2024, 32,684,156 shares issued and outstanding as of December 31, 202327 33 
Class D common stock, par value $0.001 per share; 500,000,000 shares authorized, 58,304,726 shares issued and outstanding as of June 30, 2024, 82,955,977 shares issued and outstanding as of December 31, 202358 83 
Additional paid-in-capital549,580 532,507 
Accumulated other comprehensive income832 2,909 
Accumulated deficit(170,050)(181,331)
Total stockholders' equity attributable to Clearwater Analytics Holdings, Inc.380,607 380,607 354,329 
Non-controlling interests48,064 55,328 
Total stockholders' equity428,671 428,671 409,657 
Total liabilities and stockholders' equity$585,147 $558,743 


Clearwater Analytics Holdings, Inc.
Consolidated Statements of Operations
(In thousands, except share amounts and per share amounts, unaudited)
Three Months Ended
June 30,		Six Months Ended
June 30,
2024202320242023
Revenue$106,791 $89,879 $209,510 $174,485 
Cost of revenue(1)
29,890 26,954 58,069 51,779 
Gross profit76,901 62,925 151,441 122,706 
Operating expenses:
Research and development(1)
35,360 29,848 73,036 57,948 
Sales and marketing(1)
15,169 14,331 31,480 29,029 
General and administrative(1)
22,528 25,871 43,248 49,177 
Total operating expenses73,057 70,050 147,764 136,154 
Income (loss) from operations3,844 (7,125)3,677 (13,448)
Interest income, net(1,841)(1,333)(3,901)(2,689)
Tax receivable agreement expense5,915 6,573 6,201 6,678 
Other income, net(585)(315)(1,115)(234)
Income (loss) before income taxes355 (12,050)2,492 (17,203)
Provision for (benefit from) income taxes79 (174)(19)90 
Net income (loss)276 (11,876)2,511 (17,293)
Less: Net income (loss) attributable to non-controlling interests706 (955)1,044 (1,988)
Net income (loss) attributable to Clearwater Analytics Holdings, Inc.$(430)$(10,921)$1,467 $(15,305)
Net income (loss) per share attributable to Class A and Class D common stockholders stock:
Basic$(0.00)$(0.06)$0.01 $(0.08)
Diluted$(0.00)$(0.06)$0.01 $(0.08)
Weighted average shares of Class A and Class D common stock outstanding:
Basic218,349,567198,046,275215,804,515195,865,881
Diluted218,349,567198,046,275254,208,965195,865,881

(1)Amounts include equity-based compensation as follows:
Cost of revenue$3,273 $3,248 $6,419 $5,491 
Operating expenses:
Research and development9,182 5,971 18,093 10,626 
Sales and marketing2,692 3,246 6,513 7,211 
General and administrative9,711 16,105 18,058 28,442 
Total equity-based compensation expense$24,858 $28,570 $49,083 $51,770 


Clearwater Analytics Holdings, Inc.
Consolidated Statements of Cash Flows
(In thousands, unaudited)
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
OPERATING ACTIVITIES
Net income (loss)$276 $(11,876)$2,511 $(17,293)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization2,941 2,412 5,491 4,860 
Noncash operating lease cost2,312 1,917 4,545 3,769 
Equity-based compensation24,858 28,570 49,083 51,770 
Amortization of deferred contract acquisition costs1,196 1,150 2,413 2,351 
Amortization of debt issuance costs, included in interest expense70 69 140 139 
Deferred tax benefit(970)(174)(1,992)(210)
Accretion of discount on investments(602)(380)(1,177)(396)
Realized (gain) loss on investments24 (18)24 (89)
Changes in operating assets and liabilities:
Accounts receivable, net(42)(3,759)(4,718)(9,898)
Prepaid expenses and other assets3,105 1,046 (1,093)(540)
Deferred contract acquisition costs(1,024)(701)(1,771)(1,287)
Accounts payable271 395 335 100 
Accrued expenses and other liabilities5,256 (4,410)(4,183)(11,204)
Tax receivable agreement liability6,199 6,895 4,355 7,000 
Net cash provided by operating activities43,870 21,136 53,963 29,072 
INVESTING ACTIVITIES
Purchases of property and equipment(1,454)(1,576)(2,947)(3,293)
Purchase of held to maturity investments(3,009)— (3,009)— 
Purchases of available-for-sale investments(35,493)(57,523)(67,390)(91,684)
Proceeds from sale of available-for-sale investments— 3,960 — 5,950 
Proceeds from maturities of investments38,307 2,000 59,842 3,242 
Acquisition of business, net of cash acquired(40,121)— (40,121)— 
Payment of initial direct costs for operating leases(104)— (104)— 
Net cash used in investing activities(41,874)(53,139)(53,729)(85,785)
FINANCING ACTIVITIES
Proceeds from exercise of options5 486 109 3,179 
Taxes paid related to net share settlement of equity awards(4,307)(1,172)(33,081)(8,447)
Repayments of borrowings— (687)(688)(1,374)
Payment of business acquisition holdback liability— — (780)— 
Proceeds from employee stock purchase plan2,795 2,595 2,795 2,595 
Tax distributions— — (8)— 
Net cash used in financing activities(1,507)1,222 (31,653)(4,047)
Effect of exchange rate changes on cash and cash equivalents(38)152 (251)252 
Change in cash and cash equivalents during the period451 (30,629)(31,670)(60,508)
Cash and cash equivalents, beginning of period189,644 220,845 221,765 250,724 
Cash and cash equivalents, end of period$190,095 $190,216 $190,095 $190,216 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest$851 $870 $1,762 $2,220 
Cash paid for income taxes$144 $759 $590 $1,068 
NON-CASH INVESTING AND FINANCING ACTIVITIES
Purchase of property and equipment included in accounts payable and accrued expense$55 $1 $55 $1 
Tax distributions payable to Continuing Equity Owners included in accrued expenses$3,209 $3,994 $3,209 $3,994 


Clearwater Analytics Holdings, Inc.
Reconciliation of Net Loss to Adjusted EBITDA
(In thousands, unaudited)
Three Months Ended June 30,
20242023
(in thousands, except percentages)
Net income (loss)$276 0 %$(11,876)(13 %)
Adjustments:
Interest income, net(1,841)(2 %)(1,333)(1 %)
Depreciation and amortization2,941 3 %2,412 3 %
Equity-based compensation expense and related payroll taxes25,151 24 %28,685 32 %
Tax receivable agreement expense5,915 6 %6,573 7 %
Transaction expenses875 1 %257 0 %
Other expenses(1)
131 0 %108 0 %
Adjusted EBITDA33,448 31 %24,826 28 %
Revenue$106,791 100 %$89,879 100 %
Six Months Ended June 30,
20242023
(in thousands, except percentages)
Net income (loss)$2,511 1 %$(17,293)(10 %)
Adjustments:
Interest income, net(3,901)(2 %)(2,689)(2 %)
Depreciation and amortization5,491 3 %4,860 3 %
Equity-based compensation expense and related payroll taxes53,632 26 %53,192 30 %
Tax receivable agreement expense6,201 3 %6,678 4 %
Transaction expenses1,678 1 %1,550 1 %
Other expenses(1)
38 0 %1,069 1 %
Adjusted EBITDA65,650 31 %47,367 27 %
Revenue$209,510 100 %$174,485 100 %
(1) Other expenses include gain on investments, management fees to our investors, income taxes, and foreign exchange gains and losses.
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
(in thousands)
Amortization of prepaid management fees and reimbursable expenses637 597 1,172 1,213 
Provision for (benefit from) income tax expense79 (174)(19)90 
Other income, net(585)(315)(1,115)(234)
Total other expenses$131 $108 $108 $38 $1,069 


Clearwater Analytics Holdings, Inc.
Reconciliation of Free Cash Flow
(In thousands, unaudited)
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
Net cash provided by operating activities$43,870 $21,136 $53,963 $29,072 
Less: Purchases of property and equipment1,454 1,576 2,947 3,293 
Free Cash Flow$42,416 $19,560 $51,016 $25,779 


Clearwater Analytics Holdings, Inc.
Reconciliation of Non-GAAP Information
(In thousands, except share amounts and per share amounts, unaudited)
Three Months Ended June 30,Six Months Ended June 30,
2024202320242023
Revenue$106,791 $89,879 $209,510 $174,485 
Gross profit$76,901 $62,925 $151,441 $122,706 
Adjustments:
Equity-based compensation expense and related payroll taxes3,318 3,260 6,840 5,735 
Depreciation and amortization2,494 1,930 4,596 3,903 
Gross profit, non-GAAP$82,713 $68,115 $162,877 $132,344 
As a percentage of revenue, non-GAAP77 %76 %78 %76 %
Cost of Revenue$29,890 $26,954 $58,069 $51,779 
Adjustments:
Equity-based compensation expense and related payroll taxes3,318 3,260 6,840 5,735 
Depreciation and amortization2,494 1,930 4,596 3,903 
Cost of revenue, non-GAAP$24,078 $21,764 $46,633 $42,141 
As a percentage of revenue, non-GAAP23 %24 %22 %24 %
Research and development$35,360 $29,848 $73,036 $57,948 
Adjustments:
Equity-based compensation expense and related payroll taxes9,306 6,028 21,180 11,147 
Depreciation and amortization164 253 365 531 
Research and development, non-GAAP$25,890 $23,567 $51,491 $46,270 
As a percentage of revenue, non-GAAP24 %26 %25 %27 %
Sales and marketing$15,169 $14,331 $31,480 $29,029 
Adjustments:
Equity-based compensation expense and related payroll taxes2,772 3,262 6,941 7,587 
Depreciation and amortization155 145 290 298 
Sales and marketing, non-GAAP$12,242 $10,924 $24,249 $21,144 
As a percentage of revenue, non-GAAP11 %12 %12 %12 %
General and administrative$22,528 $25,871 $43,248 $49,177 
Adjustments:
Equity-based compensation expense and related payroll taxes9,755 16,135 18,671 28,723 
Depreciation and amortization128 84 240 128 
Amortization of prepaid management fees and reimbursable expenses637 597 1,172 1,213 
Transaction expenses875 257 1,678 1,550 
General and administrative, non-GAAP$11,133 $8,798 $21,487 $17,563 


As a percentage of revenue, non-GAAP10 %10 %10 %10 %
Loss from operations$3,844 $(7,125)$3,677 $(13,448)
Adjustments:
Equity-based compensation expense and related payroll taxes25,151 28,685 53,632 53,192 
Depreciation and amortization2,941 2,412 5,491 4,860 
Amortization of prepaid management fees and reimbursable expenses637 597 1,172 1,213 
Transaction expenses875 257 1,678 1,550 
Income from operations, non-GAAP$33,448 $24,826 $65,650 $47,367 
As a percentage of revenue, non-GAAP31 %28 %31 %27 %
Net income (loss)$276 $(11,876)$2,511 $(17,293)
Adjustments:
Equity-based compensation expense and related payroll taxes25,151 28,685 53,632 53,192 
Depreciation and amortization2,941 2,412 5,491 4,860 
Tax receivable agreement expense5,915 6,573 6,201 6,678 
Amortization of prepaid management fees and reimbursable expenses637 597 1,172 1,213 
Transaction expenses875 257 1,678 1,550 
Tax impacts of adjustments to net income (loss)(1)
(8,968)(6,619)(17,667)(12,570)
Net income, non-GAAP$26,827 $20,029 $53,018 $37,630 
As a percentage of revenue, non-GAAP25 %22 %25 %22 %
Net income per share - basic, non-GAAP$0.12 $0.10 $0.25 $0.19 
Net income per share - diluted, non-GAAP$0.10 $0.08 $0.21 $0.15 
Weighted-average common shares outstanding - basic218,349,567198,046,275215,804,515195,865,881
Weighted-average common shares outstanding - diluted256,090,273252,249,228254,208,965256,412,731
(1)The non-GAAP effective tax rate was 25% for the three and six months ended June 30, 2024 and 2023, respectively, and has been used to adjust the provision for income taxes for non-GAAP net income and non-GAAP basic and diluted net income per share.


v3.24.2
Cover page
Jul. 31, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jul. 31, 2024
Entity Registrant Name Clearwater Analytics Holdings, Inc.
Entity Incorporation, State or Country Code DE
Entity File Number 001-40838
Entity Tax Identification Number 87-1043711
Entity Address, Address Line One 777 W. Main Street
Entity Address, Address Line Two Suite 900
Entity Address, City or Town Boise
Entity Address, State or Province ID
Entity Address, Postal Zip Code 83702
City Area Code 208
Local Phone Number 433-1200
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Class A common stock, par value $0.001 per share
Trading Symbol CWAN
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0001866368
Amendment Flag false
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