Clearwater Analytics (CWAN) Oppenheimer's 27th Annual Technology, Internet & Communications Conference summary

Business overview and product differentiation

• Provides global investment accounting, reporting, compliance, and risk solutions for corporates, insurers, and asset managers, with a unique security-level data model and tri-party reconciliation for accuracy and reliability.

• Achieves consistent 20%+ growth and EBITDA margins above 30%, with high gross retention rates (98-99%) and strong client satisfaction.

• Evolved from a single-product to a multi-product strategy, expanding offerings to address broader client needs and drive future growth.

• Delivers mission-critical, comprehensive, and accurate data used directly in regulatory filings, leveraging network effects for quality and efficiency.

• AI and machine learning are integrated to enhance processes, with a durable moat due to proprietary data and client integration; human oversight remains essential for regulatory accuracy.

Growth drivers and market opportunities

• Secular growth is driven by regulatory changes, especially in insurance, and the shift to multi-tenant cloud solutions, with regulatory compliance as a key buying driver.

• Expansion into new investment classes and wealth instruments is supported by platform flexibility and client confidence in handling alternative assets.

• Multi-product strategy targets greater wallet share, with new solutions like commercial paper, order management, risk models, mortgages, and benchmarking, developed in partnership with clients.

• International growth is a major focus, with strong progress in the UK, France, DACH, and early traction in Asia, aiming to balance revenue between North America and global markets.

• High client satisfaction and referenceability reduce sales and marketing costs, supporting efficient expansion.

Financial performance and strategic goals

• Net revenue retention (NRR) improved from 107% to 110%, with a target of 115% by Q1 2026, driven by increased product adoption and wallet share.

• Growth in NRR is expected by expanding the share of new products sold to existing clients, aiming for a diversified product mix.

• EBITDA margins are already above 30%, with guidance to reach 35% in the next few years and a long-term goal of 40%, enabled by network effects and efficient unit economics.

• Operating leverage is expected from R&D efficiencies and continued focus on client-driven innovation, while maintaining deliberate investment in global sales and product development.

• The company is reorganizing sales teams to focus on both back-to-base and new logo growth, supporting the multi-product and international expansion strategies.