Summary
Workday, Inc. reported strong revenue growth of 38% year-over-year for the first quarter of fiscal year 2017, reaching $345.4 million. This growth was primarily driven by a 39% increase in subscription services revenue, which now constitutes 81% of total revenue, highlighting the company's successful transition to a subscription-based cloud model. Despite this revenue expansion, the company continued to operate at a net loss of $80.6 million, reflecting significant ongoing investments in product development, sales, and marketing to support long-term growth and market expansion. The company's balance sheet shows a healthy cash and marketable securities position of $2.1 billion, providing ample liquidity.
Financial Highlights
40 data pointsBeta
Financial Statements
Beta
| Revenue | $347.68M |
| R&D Expenses | $141.78M |
| Operating Expenses | $419.21M |
| Operating Income | -$71.53M |
| Interest Expense | $8.03M |
| Net Income | -$78.50M |
| EPS (Basic) | $-0.40 |
| Shares Outstanding (Basic) | 194.53M |
Key Highlights
- 1Total revenues increased by 38% year-over-year to $345.4 million, driven by strong subscription services growth.
- 2Subscription services revenue grew by 39% to $280.0 million, representing 81% of total revenues.
- 3Operating expenses increased by 38% to $419.1 million, largely due to increased employee-related costs from headcount growth and investments in product development and sales/marketing.
- 4The company reported a net loss of $80.6 million for the quarter, compared to $61.6 million in the prior year, reflecting ongoing investment.
- 5Cash and cash equivalents and marketable securities totaled $2.1 billion as of April 30, 2016, indicating strong liquidity.
- 6Non-GAAP operating margins improved significantly to 3.2% from -0.8% in the prior year period, showcasing improved operational efficiency on a non-GAAP basis.
- 7Free cash flow generation was robust, increasing by $63 million to $127 million for the quarter.
Frequently Asked Questions
Workday's primary revenue driver is its subscription services, which grew by 39% year-over-year in the first quarter of fiscal year 2017. This segment now represents 81% of the company's total revenue, indicating a strong and growing demand for its cloud-based financial and human capital management applications.
No, Workday reported a net loss of $80.6 million for the quarter ended April 30, 2016. The company is continuing to invest heavily in growth initiatives, including product development and sales and marketing, which are impacting short-term profitability. Management expects these investments to drive long-term revenue growth.
Workday's operating expenses increased by 38% year-over-year, primarily due to higher employee-related costs associated with increased headcount and strategic investments in product development and sales and marketing. However, on a non-GAAP basis, which excludes items like share-based compensation, operating margins improved significantly to 3.2% from -0.8% in the prior year, suggesting improved operational leverage.
Workday maintains a strong liquidity position, with cash, cash equivalents, and marketable securities totaling $2.1 billion as of April 30, 2016. This provides the company with substantial financial flexibility to fund its ongoing operations, investments, and growth strategies.