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Jun 30
Clearwater Q2 2025 Earnings Report
Clearwater Analytics announced its second quarter 2025 financial results, reporting significant revenue and ARR growth, alongside increased adjusted EBITDA and non-GAAP net income.
Key Takeaways
Clearwater Analytics delivered a strong second quarter in 2025, with total revenue increasing by over 70% year-over-year to $181.9 million. The company also saw substantial growth in Annualized Recurring Revenue (ARR), which reached $783.5 million, up 83% from the previous year. Adjusted EBITDA grew by 74.3% to $58.3 million, and non-GAAP net income increased by 29.7% to $34.8 million, demonstrating robust financial performance and successful integration efforts.
Total revenue for Q2 2025 was $181.9 million, marking a 70.4% increase year-over-year.
Annualized Recurring Revenue (ARR) reached $783.5 million as of June 30, 2025, an 83% increase from the prior year.
Adjusted EBITDA for the quarter was $58.3 million, up 74.3% year-over-year, with an adjusted EBITDA margin of 32.1%.
Non-GAAP net income increased by 29.7% to $34.8 million, while GAAP net loss was $24.2 million.
Clearwater
Clearwater
Clearwater Revenue by Segment
Revenue by Segment
Core Clearwater Business Revenue
CapyFin.com Forward Guidance
Clearwater Analytics provided strong guidance for both the third quarter and full year 2025, projecting continued revenue growth and healthy adjusted EBITDA margins.
Positive Outlook
- Third quarter 2025 revenue is projected to be between $203 million and $204 million, representing 75% to 76% year-over-year growth.
- Full year 2025 revenue is expected to be between $726 million and $732 million, indicating 61% to 62% year-over-year growth.
- Third quarter 2025 Adjusted EBITDA is anticipated to be approximately $65 million, with a margin of around 32%.
- Full year 2025 Adjusted EBITDA is projected to be between $232 million and $237 million, maintaining a margin of approximately 32%.
- The company has already achieved its $20 million synergy target a full year ahead of schedule.
Challenges Ahead
- Total equity-based compensation expense and related payroll taxes for the full year 2025 are estimated at approximately $135 million, or 18% of revenues.
- Depreciation and Amortization for the full year 2025 is projected to be approximately $86 million.
- Interest Expense for the full year 2025 is estimated at approximately $48 million.
- The company does not provide a reconciliation of non-GAAP guidance to GAAP guidance due to unreasonable efforts.
- The guidance includes certain non-GAAP measures which are not based on standardized GAAP methodology.