Summary
Workday, Inc. (WDAY) reported its first-quarter fiscal year 2018 results (ending April 30, 2017), demonstrating robust revenue growth driven primarily by its subscription services. Total revenues increased by 38% year-over-year to $479.9 million, with subscription services revenue alone growing by 43% to $399.7 million. Despite this strong top-line performance, the company continued to operate at a net loss of $64.0 million, a slight improvement from the $78.5 million net loss in the same period last year. This loss is attributed to significant investments in product development and sales & marketing to fuel future growth. The company also highlighted an improvement in its non-GAAP operating margin, which expanded to 12.7% from 3.8% in the prior year period, indicating increasing operational efficiency as revenue scales. Workday maintained a strong liquidity position with $2.1 billion in cash, cash equivalents, and marketable securities. Cash flow from operations remained positive at $180.0 million, and the company also generated a healthy free cash flow of $149.4 million, demonstrating its ability to fund operations and growth initiatives internally. Investors should note the ongoing strategic investments in R&D and sales, which are expected to continue to weigh on GAAP profitability in the near term but are crucial for maintaining market leadership in the cloud enterprise software space.
Financial Highlights
40 data points| Revenue | $479.86M |
| R&D Expenses | $196.44M |
| Operating Expenses | $540.06M |
| Operating Income | -$60.20M |
| Interest Expense | $6.99M |
| Net Income | -$64.04M |
| EPS (Basic) | $-0.31 |
| Shares Outstanding (Basic) | 203.82M |
Key Highlights
- 1Total revenues grew 38% year-over-year to $479.9 million.
- 2Subscription services revenue increased by 43% to $399.7 million, forming the core of the company's revenue base.
- 3Net loss improved to $64.0 million from $78.5 million in the prior year period.
- 4Non-GAAP operating margin significantly improved to 12.7% from 3.8% in the prior year period.
- 5Operating expenses increased significantly due to investments in product development and sales & marketing, reflecting a growth-oriented strategy.
- 6The company maintained a strong liquidity position with $2.1 billion in cash, cash equivalents, and marketable securities.
- 7Free cash flow was robust at $149.4 million, indicating healthy cash generation from operations.