Company: CWAN
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0001628280-25-008169
Chunk: 63

Company: Clearwater Analytics Holdings, Inc.
Filing Date: 2025-02-26
Form: 10-K
Item: Item 7
Chunk 63
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106 %109 %108 %107 %2022Gross retention rate98 %98 %98 %98 %Net retention rate107 %104 %103 %106 %

Gross revenue retention rates have remained consistently at least 98% in 23 of the past 24 quarters. We believe the extremely consistent and high gross revenue retention rate is a testament to the value proposition that our leading solution offers.

Non-GAAP Financial Measures

We also consider certain non-GAAP financial measures that are not prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), such as adjusted EBITDA and adjusted EBITDA Margin, in measuring the performance of our business. The non-GAAP measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies. However, we believe that this non-GAAP information is useful as an additional means for investors to evaluate our operating performance, when reviewed in conjunction with our GAAP financial statements. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with GAAP, and because these amounts are not determined in accordance with GAAP, they should not be used exclusively in evaluating our business and operations. In addition, undue reliance should not be placed upon non-GAAP or operating information because this information is neither standardized across companies nor subjected to the same control activities and audit procedures that produce our GAAP financial results.

Adjusted EBITDA and Adjusted EBITDA Margin

Adjusted EBITDA and Adjusted EBITDA Margin are supplemental performance measures that our management uses to assess our operating performance. We define Adjusted EBITDA as net loss plus (i) interest income, net, (ii) depreciation and amortization expense,  (iii) equity-based compensation expense and related payroll taxes, (iv) tax receivable agreement expense, (v) transaction expenses, (vi) amortization of prepaid management fees and reimbursable expenses, (vii) provision for (benefit from) income taxes, (viii) other income, net, and (ix) Up-C structure expenses. We define Adjusted EBITDA Margin as Adjusted EBITDA (as defined above) divided by revenue. 

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Table of Contents

The following table reconciles net loss to Adjusted EBITDA and includes amounts expressed as a percentage of revenue for the periods indicated.

Year Ended December 31,202420232022(in thousands, except percentages