We recently published 10 Best SaaS Stocks Trading at a Discount.  Clearwater Analytics Holdings, Inc. (NYSE:CWAN) is one of the best Saas stocks trading at a discount. Clearwater Analytics Holdings, Inc. (NYSE:CWAN) is a SaaS company that caters to the needs of the finance industry. Investment firm DA Davidson is one of the most ardent followers of the firm and its latest coverage came on December 10th. It saw DA Davidson reiterate a Buy rating and a $30 share price target for Clearwater Analytics Holding ...

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $36.2 million, down 11% year over year, primarily due to a strategic shift away from bulk hardware sales towards a more sustainable SaaS-focused revenue mix [14] - SaaS revenue reached $14.2 million, increasing 7% year over year, now representing 39% of total revenue compared to 33% in the same period last year [14] - Adjusted EBITDA loss improved by 23% to a loss of $2.9 million, while net loss improved 36% year over year to a loss of $6.3 million [18] - Operating expenses decreased by 34% year over year to $16.6 million, aided by accrual reversals of approximately $2.5 million [16][18] Business Line Data and Key Metrics Changes - Hardware revenue totaled $11.5 million, reflecting a 38% decline year over year due to the strategic shift mentioned earlier [14] - Professional services revenue increased by 113% year over year to $7 million, driven by higher installation volume and improved project efficiency [15] - Annual recurring revenue reached $56.9 million, up 7% year over year, indicating steady expansion of the recurring base [15] Market Data and Key Metrics Changes - The installed base reached 870,000 units, up 11% from the prior year, with 83,000 net new units added since the same quarter last year [15] - The company deployed more than 22,000 new units during the quarter, a 49% increase compared to the prior year period [15] Company Strategy and Development Direction - The company aims to simplify and automate key internal processes over the next eighteen months, expecting significant financial and operational benefits starting in 2026 [8] - The focus remains on building a durable revenue growth platform and achieving higher levels of sustainable profitability in 2026 and beyond [9] - The company is committed to maintaining cost discipline and operational rigor to support future growth [19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth of the installed unit base next year, citing improvements in the sales organization and customer engagement [25][36] - The macro environment presents challenges, but there is confidence in the pipeline of potential unit installations [27][35] - Management noted strong customer relationships, with a net revenue retention rate well above 100%, indicating customer satisfaction and loyalty [11] Other Important Information - The company ended the quarter with $100 million in cash, no debt, and $75 million in undrawn credit, providing a strong balance sheet for future investments [18] - A new leader was added to the team to drive expansion and improve internal processes [7] Q&A Session Summary Question: SaaS revenue growth lower than deployed unit growth - Management acknowledged that the SaaS ARPU was impacted by non-IoT related adjustments and expects a correction in Q4 [22][23] Question: Progress within the sales organization - Management indicated that the company can support a deployment capacity of 20,000 to 25,000 units per quarter, with potential for more based on current sales and installation infrastructure [26][28] Question: Feedback from stakeholders - Management reported positive feedback from customers regarding the value of solutions and strong collaboration, with minimal customer turnover [32][34] Question: Future growth rate expectations - Management expects a smoother growth rate in 2026 as bulk hardware sales normalize, leading to a closer coupling of hardware revenue with deployment volume [40] Question: Financial discipline moving forward - Management confirmed a commitment to maintaining disciplined financial practices and evaluating the best use of available cash for reinvestment [41]

Group 1 - The core point of the article is that ServiceNow's stock rose over 7% in pre-market trading after the company raised its annual subscription revenue forecast [1] Group 2 - ServiceNow is identified as a SaaS giant, indicating its significant presence in the Software as a Service industry [1]