Workday, Inc. Quarterly Report for Q2 Ended Jul 31, 2014

Summary

Workday, Inc. (WDAY) reported its second-quarter fiscal year 2015 results for the period ending July 31, 2014. The company demonstrated strong revenue growth, with total revenues increasing by 74% year-over-year to $186.8 million. This growth was primarily driven by subscription services, which rose 77% to $143.7 million, indicating continued strong demand for Workday's core cloud-based HCM and financial management applications. Despite the robust top-line growth, Workday continued to operate at a net loss, reporting a net loss of $69.2 million for the quarter, compared to a net loss of $36.0 million in the prior year period. This widened loss is largely attributable to significant investments in product development and sales and marketing to fuel future growth. The company's cash position remains strong, with cash and cash equivalents and marketable securities totaling $1.8 billion, providing ample liquidity for ongoing operations and strategic initiatives.

Key Highlights

• 1Total revenues increased 74% year-over-year to $186.8 million.
• 2Subscription services revenue grew 77% to $143.7 million, highlighting strong core business performance.
• 3Professional services revenue increased 63% to $43.1 million, indicating robust customer adoption and deployment needs.
• 4Net loss widened to $69.2 million from $36.0 million in the prior year, reflecting increased investment in growth initiatives.
• 5Operating expenses grew significantly, with product development and sales & marketing expenses increasing by 60% and 68% respectively for the quarter.
• 6Cash and cash equivalents and marketable securities totaled $1.8 billion, providing a strong liquidity position.
• 7Workday completed the acquisition of Identified, Inc. for $26.4 million to enhance its analytics and machine learning capabilities.

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