Unpacking Q1 Earnings: Guidewire Software (NYSE:GWRE) in the Context of Other Vertical Software Stocks
As first-quarter earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the software vertical, including Guidewire Software (NYSE:GWRE) and its peers.
Software is eating up the world, and while a large number of solutions such as project management or video conferencing software can be useful for a variety of industries, some have very specific requirements. As a result, vertical software covering industry-specific workflows is growing and is driven by pressure to increase productivity, be it for a life sciences, education or banking company.
The four vertical software stocks we track had a strong first quarter. Overall, sales beat analyst consensus estimates by 3.7%, while the next quarter’s sales forecast was 0.9% higher.
Given this news, company share prices remained stable, rising an average of 1.9% since the last earnings results.
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Guidewire Software (NYSE:GWRE)
With systems supporting the operations of hundreds of insurance brands in 42 countries, Guidewire Software (NYSE:GWRE) provides a technology platform that helps property and casualty insurance companies manage their core businesses, digital engagement and analytics.
Guidewire Software reported revenue of $372.5 million, up 26.9% year over year. This print exceeded analyst expectations by 4.7%. Overall, it was a strong quarter for the company, with analysts’ billing estimates impressively exceeded and full-year revenue guidance coming in slightly ahead of analysts’ expectations.
Guidewire Software achieved the fastest revenue growth and highest full-year forecast increase across the group. However, investors’ expectations were likely higher than the forecasts published by Wall Street, leaving some wanting even better results (analysts’ consensus estimates come from major banks and consulting firms, not from the investors who make buying and selling decisions). The stock has fallen 11% since reporting and is currently trading at $134.50.
We believe Guidewire Software is a good deal, but is it a buy today? Read our full report here, it’s free.
Best Q1: Alarm.com (NASDAQ:ALRM)
Alarm.com (NASDAQ:ALRM) processes over 325 billion data points annually from more than 150 million connected devices and provides cloud-based platforms that enable residential and commercial property owners to remotely monitor and control their security, video, energy and other connected devices.
Alarm.com reported revenue of $265.2 million, up 11% from a year ago and beating analysts’ expectations by 5.6%. The company had a very strong quarter, significantly exceeding analyst billings and EBITDA estimates.
The story continues
Alarm.com beat analyst estimates the most among its peers. The market seems pleased with the results as the stock is up 5.8% since reporting. It is currently trading at $49.75.
Is now the time to buy Alarm.com? You can access our full earnings results analysis for free here.
Slowest Q1: Bentley Systems (NASDAQ:BSY)
Bentley Systems (NASDAQ:BSY) pioneered the concept of “digital twins” for infrastructure projects long before it became an industry buzzword. The company provides software solutions that help engineers design, build and operate infrastructure projects in various sectors, including roads, bridges, utilities, mining and industrial facilities.
Bentley Systems reported revenue of $424.2 million, up 14.5% from a year ago and beating analysts’ expectations by 1.2%. Nevertheless, it was a weaker quarter as analysts’ billing estimates were significantly missed.
Bentley Systems delivered the weakest performance in the group compared to analyst estimates. The stock has been flat since the results and is currently trading at $32.30.
Read our full analysis of Bentley Systems’ results here.
Manhattan Associates (NASDAQ:MANH)
Based on a “versionless” cloud architecture that delivers quarterly updates to all customers, Manhattan Associates (NASDAQ:MANH) develops cloud-based software that helps retailers, wholesalers and manufacturers manage their supply chains, inventory and omnichannel operations.
Manhattan Associates reported revenue of $282.2 million, up 7.4% year over year. This figure beat analysts’ expectations by 3.3%. It was a strong quarter, as full-year EPS and revenue guidance was also slightly above analysts’ expectations.
Manhattan Associates experienced the slowest revenue growth among its peers. The stock is up 12% since reporting and is currently trading at $151.04.
Read our full, actionable report on Manhattan Associates here for free.
Market update
At the end of 2025 to the beginning of 2026 there was a dispute about artificial intelligence. There was concern among software companies that AI would erode pricing power and squeeze margins as new tools made it easier to replicate what previously required expensive enterprise platforms. Crypto investors had their own version of the same fear: If AI agents could trade, allocate capital, and manage wallets autonomously, what exact long-term value would today’s crypto infrastructure have?
These concerns triggered a noticeable rotation away from these sectors and towards safer havens. But markets rarely dwell on one narrative for long. Spring 2026 arrived and the focus abruptly shifted from technological disruption to geopolitical risks. The US conflict with Iran has become the dominant driver of market psychology, and when geopolitics takes center stage, the script quickly changes. Investors stop debating growth rates and start worrying about oil supplies, inflation and global stability.
Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum stocks and add them to your watchlist. These companies are focused on growth regardless of the political or macroeconomic climate.
https://finance.yahoo.com/markets/stocks/articles/unpacking-q1-earnings-guidewire-software-203406227.html
