Company: CWAN
Filing Date: 2025-05-02
Form Type: 10-Q
Source: 0001628280-25-021833
Chunk: 106

Company: Clearwater Analytics Holdings, Inc.
Filing Date: 2025-05-02
Form: 10-Q
Item: Part I, Item 2
Chunk 106
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 thousands)Increased payroll and related costs$3,592 Increased data costs1,008 Increased depreciation and amortization662 Increased equity-based compensation318 Other items166 Total change$5,746 

The increase in cost of revenue for the three months ended March 31, 2025 was primarily due to increased payroll and related costs as a result of headcount growth, increases in merit-based compensation, and changes in our employee base leading to higher compensation, and increased equity-related payroll taxes for vested equity awards. In addition, cost of revenue increased due to higher data costs for acquiring vendor data contracts related to the Wilshire Technology acquisition, increased depreciation and amortization related to the amortization of capitalized IT projects and acquired Wilshire Technology intangible assets, and increased equity-based compensation due to grants of additional awards to employees. 

Operating Expenses

Research and Development

Three Months EndedMarch 31,(In thousands, except percentages)20252024$ Change% ChangeEquity-based compensation$8,698 $8,911 $(213)(2)%All other research and development28,702 28,765 (63)— %Total research and development$37,400 $37,676 $(276)(1)%Percent of revenue29 %37 %

28

Research and development expenses changed as follows:

Change From 2024 to 2025 QTD(in thousands)Decreased payroll and related costs(2,187)Decreased equity-based compensation(213)Increased technology cost1,477 Decreased tax credits557 Other items90 Total change$(276)

The decrease in research and development expense for the three months ended March 31, 2025 was primarily due to decreased equity-related payroll tax, as there were RSU releases from a JUMP executive during the three months ended March 31, 2024, decreased equity-based compensation, offset by increased technology costs from higher utilization of third-party cloud computing services and other third-party IT services, and decreased tax credits from elimination of payroll tax credit earned in 2024.

Sales and Marketing

Three Months EndedMarch 31,(In thousands, except percentages)20252024$ Change% ChangeEquity-based compensation$4,009 $3,821 $188 5 %All other sales and marketing15,622 12,490 3,132 25 %Total sales and marketing$19,631 $16,311 $3,320 20 %Percent of revenue15