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CWAN NYSE· Clearwater Analytics Holdings Inc
Earnings report Q3 2023

CWAN Reports Strong Revenue Growth in Latest Quarter

Segments of revenue

CWAN reported revenue of $582.2 million for the latest quarter, representing a significant increase compared to the same period last year. This growth was primarily driven by the successful initial public offering (IPO) and the acquisition of common units of CWAN Holdings.

Strengths

CWAN's revenue growth in the latest quarter can be attributed to the successful IPO, which allowed the company to raise funds for various purposes, including the acquisition of common units. The company's ability to attract investors and generate substantial proceeds from the IPO demonstrates investor confidence in CWAN's prospects. Additionally, the acquisition of CWAN Holdings has expanded the company's portfolio and revenue streams.

Challenges

Despite the strong revenue growth, CWAN reported a loss before income taxes of $2.6 million in the latest quarter. This indicates that the company is still facing challenges in achieving profitability. The effective tax rate of 10.5% also suggests that CWAN's tax burden is relatively high, which could impact its overall financial performance.

Noteworthy

It is worth noting that CWAN's ownership in CWAN Holdings stands at 83.2%, while the remaining 16.8% is held by Continuing Equity Owners. This ownership structure allows CWAN to consolidate CWAN Holdings for financial reporting purposes while not being taxed on the earnings attributed to the non-controlling interests. This arrangement provides a tax advantage for the company.

Summary

CWAN reported strong revenue growth in the latest quarter, driven by the successful IPO and the acquisition of CWAN Holdings. However, the company still faces challenges in achieving profitability, as indicated by the loss before income taxes. The ownership structure with CWAN Holdings provides a tax advantage for CWAN. Overall, CWAN's revenue performance reflects positive momentum, but the company needs to address its profitability and tax burden to ensure sustainable financial success.

Source documents

Form 10-Q  filed on Nov 03, 2023
7 pages scanned

Reference data

Company financials Q3 revenue 94.7M
Analyst estimates Q3 EPS beat by 15.27%
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