Seeking Alpha

Workday's FQ4 guidance strong, unearned revenue growth accelerates

  • Workday (WDAY) is guiding for FQ4 revenue of $133M-$138M, soundly above a $128.9M consensus.
  • The cloud HR/ERP software vendor's unearned revenue balance rose 8% Q/Q and 40% Y/Y to $351.8M; Y/Y growth accelerated from FQ2's 32% clip.
  • Subscription revenue (74% of total revenue) rose 82% Y/Y, and services revenue rose 61%.
  • Operating cash flow was $7.1M, and free cash flow was -$9.7M (less than a net loss of $21.3M).
  • Much like Salesforce, Workday continues to spend aggressively: R&D and sales/marketing spend both rose 56% Y/Y to $41.9M and $49.4M, respectively.
  • WDAY +6.3% AH. CC at 5PM ET.
  • FQ3 results, PR
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