Summary
Workday, Inc.'s 2019 10-K report highlights a year of significant revenue growth, driven primarily by its subscription services for Human Capital Management (HCM) and Financial Management applications. Total revenues increased by 32% year-over-year to $2.8 billion, with subscription services comprising 85% of this total. Despite robust revenue expansion, the company continues to invest heavily in product development and sales & marketing, resulting in an operating loss of $463 million for fiscal year 2019. The acquisition of Adaptive Insights in August 2018 for $1.5 billion bolstered Workday's financial planning capabilities and contributed to a substantial increase in goodwill and acquisition-related intangible assets. Financially, Workday ended fiscal year 2019 with $1.8 billion in cash, cash equivalents, and marketable securities, providing ample liquidity. The company's balance sheet reflects increased investments in property and equipment, along with a significant increase in goodwill due to the Adaptive Insights acquisition. Workday's cloud-based, subscription-revenue model provides strong recurring revenue, although the company emphasizes its ongoing commitment to reinvesting in growth rather than prioritizing short-term profitability.
Financial Highlights
43 data points| Revenue | $2.82B |
| R&D Expenses | $1.21B |
| Operating Expenses | $3.29B |
| Operating Income | -$463.28M |
| Interest Expense | $60.21M |
| Net Income | -$418.26M |
| EPS (Basic) | $-1.93 |
| Shares Outstanding (Basic) | 216.79M |
Key Highlights
- 1Total revenues grew by 32% to $2.8 billion in fiscal year 2019, with subscription services accounting for the majority (85%).
- 2The company experienced an operating loss of $463 million, reflecting continued significant investment in product development and sales & marketing to fuel growth.
- 3Workday completed the acquisition of Adaptive Insights for $1.5 billion, enhancing its financial planning and analytics capabilities.
- 4The company maintained a strong liquidity position, with $1.8 billion in cash, cash equivalents, and marketable securities as of January 31, 2019.
- 5Operating expenses, including share-based compensation, increased significantly, driven by higher headcount and investments in infrastructure.
- 6Workday continues to focus on its cloud-based, subscription-revenue model, with a substantial backlog of $6.7 billion in remaining performance obligations for subscription contracts.
- 7The dual-class stock structure gives significant voting control to key executives, potentially limiting influence for other shareholders.