Workday (WDAY) - NYSE
  • Fri, Feb. 5, 11:01 AM
    • A long list of enterprise software and security tech names are off sharply after business intelligence/analytics software upstart Tableau (down 45.3%) reported slower-than-expected license revenue growth and issued below-consensus Q1/2016 guidance.
    • Also possibly weighing: LinkedIn (down 39.6%), which derives a large % of its revenue from cloud-based recruiting and sales tools for enterprises, issued weak Q1/2016 guidance.
    • Given the magnitude of the drops, margin calls and forced selling by funds could be playing a big role. The Nasdaq is down 2.2%.
    • Tableau suggested its growth slowdown has to do with softening IT spend and a need to improve sales productivity, but analysts have raised questions about competition from the likes of Microsoft, Amazon, and Qlik. LinkedIn forecast a growth slowdown for its field sales hiring solutions business, while blaming European/Asian macro pressures. The company also noted its display ad business continues declining amid weak industry growth.
    • Major enterprise software decliners include Splunk (SPLK -23.7%), Workday (WDAY -15.1%), Adobe (ADBE -7%), Zendesk (ZEN -15.2%), ServiceNow (NOW -13.6%), NetSuite (N -12.4%), Salesforce (CRM -11.2%), Paycom (PAYC -10.6%), Ellie Mae (ELLI -11.5%), Cornerstone OnDemand (CSOD -7.8%), Veeva (VEEV -7.7%), Ultimate Software (ULTI -9%), Luxoft (LXFT -7.5%), Manhattan Associates (MANH -8.5%), Box (BOX -6.6%), Guidewire (GWRE -13.6%), Demandware (DWRE -9.3%), Hortonworks (HDP -9.7%), and Tableau rival Qlik (QLIK -16.6%). The casualty list includes many cloud software firms, as well as several analytics software plays. Previously covered: New Relic, Atlassian.
    • Major decliners among security tech firms: Palo Alto Networks (PANW -12%), FireEye (FEYE -8.9%), Rapid7 (RPD -8.6%), CyberArk (CYBR -8.3%), Proofpoint (PFPT -8%), Imperva (IMPV -8.3%), Fortinet (FTNT -6.9%), and Vasco (VDSI -5.1%). The selloff comes in spite of an FQ3 beat and in-line FQ4 guidance from Symantec, which has been losing share to various upstarts.
    | Fri, Feb. 5, 11:01 AM | 19 Comments
  • Thu, Jan. 28, 2:53 PM
    • Though the Nasdaq is up 0.8%, enterprise cloud software firms Salesforce (CRM -2.7%), Workday (WDAY -3.8%), Demandware (DWRE -4.5%), Veeva (VEEV -3.5%), Cornerstone OnDemand (CSOD -3.3%), Marketo (MKTO -4.4%), Actua (ACTA -2.4%), HubSpot (HUBS -6.2%), and Zendesk (ZEN -2.7%) are lower after cloud IT service management (ITSM) software leader ServiceNow (NOW -16.5%) posted a Q4 billings miss to go with revenue/EPS beats and issued light 2016 sales guidance.
    • On ServiceNow's earnings call (transcript), CFO Michael Scarpelli attributed the billings shortfall to a ~$5M forecasting error. Regardless, Mizuho and MKM have responded to the Q4 report by downgrading to Neutral. Mizuho: "We find two [billings] misses in one year concerning." The firm is also worried about a premium valuation, missed quotas by sales reps, and a "large customer's preference to cut payment terms in half."
    • MKM is less concerned about the billings miss, and calls Q4 results solid. But the firm is worried about macro pressures, and thinks ServiceNow's track record of major op. margin guidance beats is "unlikely to be sustained given decelerating billings and the current macroeconomic environment."
    | Thu, Jan. 28, 2:53 PM | 12 Comments
  • Wed, Jan. 6, 1:46 PM
    • Barclays' Raimo Lenschow has downgraded firewall/security software firm Check Point (CHKP -1.9%), cloud talent management software firm Cornerstone OnDemand (CSOD -2.7%), and data warehousing hardware/software provider Teradata (TDC -3.8%) to Underweight. Cloud HR/financials software vendor Workday (WDAY -3.6%) and e-commerce software/services provider Demandware (DWRE -2.9%) have been cut to Equal Weight.
    • Cloud HR software firm Paycom (PAYC -1%), on the other hand, has been upgraded to Overweight on a belief consensus estimates are too low. Meanwhile, BofA/Merrill has launched coverage on Demandware at Buy.
    • Regarding Check Point, Lenschow says he prefer security tech firms that are gaining share - his top three ideas are Palo Alto Networks, Imprivata, and Rapid7. He sees security IT spend rising 7% in both 2016 and 2017, a rate on par with 2015's.
    • Regarding Cornerstone, Lenschow is worried about slowing top-line growth, a lack of profits, and growing competition. Regarding Workday, he's concerned about competition from SAP/Oracle, a high valuation, and the relatively limited impact of its financials offerings on sales growth.
    • The downgraded names are underperforming amid a 1.1% Nasdaq drop.
    | Wed, Jan. 6, 1:46 PM | 1 Comment
  • Dec. 11, 2015, 3:21 PM
    • A long list of tech firms are off sharply as the Nasdaq and S&P respectively drop 2% and 2.2% ahead of an expected Fed rate hike.
    • The casualty list includes threat-prevention hardware/software provider FireEye (FEYE -6.2%), machine data analytics software vendor Splunk (SPLK -7.1%), driver-assistance system vendor Mobileye (MBLY -6.3%), supercomputer makers Cray (CRAY -7.6%) and Silicon Graphics (SGI -7%), audio codec chipmaker Cirrus Logic (CRUS -5.3%), and local services marketplace Angie's List (ANGI -6.3%).
    • Others include cloud HR/financials software provider Workday (WDAY -5.6%). enterprise social networking software firm Jive Software (JIVE -5.9%), cloud telematics software provider FleetMatics (FLTX -5.2%), mobile accessory maker Zagg (ZAGG -7.5%), network visibility/monitoring hardware provider Gigamon (GIMO -5.8%), smart grid networking hardware/software provider Silver Spring (SSNI -8.9%), and online travel deals provider Travelzoo (TZOO -6%).
    | Dec. 11, 2015, 3:21 PM | 2 Comments
  • Nov. 20, 2015, 3:56 PM
    • "We think it’s reasonable to surmise that Oracle’s (NYSE:ORCL) push to blunt Workday’s (WDAY -1.4%) momentum in its PeopleSoft base is having some impact, or at least lengthening Workday’s sales cycles as per our integrator checks," writes Wedbush's Steve Koenig, downgrading the cloud HR/financials software leader to Neutral after it offered light FQ4 guidance to go with an FQ3 beat. His target has been cut by $15 to $84.
    • Koenig, whose remarks come six months after Jefferies reported Oracle is pricing aggressively against Workday, also calls FQ3 revenue (though above consensus) "somewhat disappointing," and notes subscription revenue growth has dropped to 48% Y/Y from Q1's 63%. He adds Workday has been offering more flexible payment terms to counter Oracle, and that this is expected to "result in a three-point headwind to fourth-quarter subscription revenue and five points next year," before normalizing in FY18 (ends Jan. '18).
    • William Blair's Justin Furby (Outperform) is less troubled by Workday's FQ4 outlook, noting the subscription shortfall is solely the result of payment term changes and that management often guides conservatively. He adds Workday originally guided for "no more than 40%" FY16 sales growth, and is now on track to post 47%+ growth.
    • On its earnings call (transcript), Workday said it's "building our investment and hiring models assuming total revenue growth of above 30% for fiscal 2017." Consensus is for 37.2% growth.
    • Drexel Hamilton's Brian White (Buy) is pleased with growing financials software traction, as well as the recent unveiling of several other apps (Learning, Planning, Payroll, Insight Applications). Wunderlich's Rob Breza (Hold) isn't as impressed. "Conf.call highlights focused on the Financials offering, with ~90 customers live vs. 80 in the prior quarter, which is likely to leave investors feeling uninspired. Investors are left waiting for meaningful Financials acceleration to offset the HCM deceleration as new HCM products reach [general availability] in 2H16."
    | Nov. 20, 2015, 3:56 PM
  • Nov. 20, 2015, 9:17 AM
    | Nov. 20, 2015, 9:17 AM
  • Nov. 19, 2015, 5:35 PM
    | Nov. 19, 2015, 5:35 PM
  • Nov. 19, 2015, 4:08 PM
    • Workday (NYSE:WDAY): FQ3 GAAP EPS of-$0.41 not comparable with -$0.04 non-GAAP consensus. Non-GAAP net loss was $373K.
    • Revenue of $305.3M (+42.0% Y/Y) beats by $1.82M.
    • Expects FQ4 revenue of $317M-$320M (+40%-41% Y/Y), below a $320.3M consensus.
    • Shares -2.6% after hours.
    | Nov. 19, 2015, 4:08 PM | 6 Comments
  • Nov. 18, 2015, 5:35 PM
  • Nov. 6, 2015, 12:22 PM
    • In addition to beating FQ1 estimates, Paylocity (NASDAQ:PCTY) is guiding for FQ2 revenue of $48M-$49M and EPS of -$0.04 to -$0.02, above a consensus of $45.4M and -$0.08. The company also now expects FY16 (ends June '16) revenue of $210M-$214M and EPS of $0.04-$0.07, above a consensus of $201.6M and -$0.05.
    • Cloud HR/HCM software leader Workday (WDAY +2.5%) is following Paylocity higher. Cornerstone OnDemand's strong 2016 outlook might also be helping. Two days ago, Paylocity rallied in response to Paycom's Q3 beat and strong Q4 guidance. Workday's FQ3 report is expected later this month.
    • Paylocity CEO Steve Beauchamp: "We continue to see strong demand for our unified payroll and HCM platform and are encouraged by the response to our ACA Enhanced product offering," Adjusted gross margin rose 450 bps Y/Y to 58.8%. GAAP operating expenses rose 37% Y/Y to $28.3M.
    • Paylocity's Q3 beat, PR
    | Nov. 6, 2015, 12:22 PM
  • Oct. 1, 2015, 12:30 PM
    • Citing optimism about "new products, better positioning around the value proposition for financials, a growing ecosystem, [and] a revived go-to-market approach," Stephens' Alex Zukin has upgraded Workday (NYSE:WDAY) to Overweight amid the company's Workday Rising customer conference, and in the wake of its analyst day. His target remains $85.
    • Zukin is now more optimistic about Workday's ability to land Fortune 500 clients for its Financials product (still accounts for a much smaller portion of revenue than Workday's HCM/HR product), and notes there are now over 4,800 trained Workday implementation consultants, up 35% Y/Y. IBM is set to acquire Workday consulting/implementation firm Meteorix.
    • Shares are rallying on a down day for equities.
    • Analyst day slides (.pdf), more analyst commentary
    • Previously: Workday unveils employee-learning software, takes aim at Cornerstone
    | Oct. 1, 2015, 12:30 PM
  • Sep. 30, 2015, 2:50 PM
    • Workday Learning, unveiled at the annual Workday Rising conference, complements the company's mainstay cloud Human Capital Management (HCM) product, and is declared to "offer a more personalized, meaningful learning experience for organizations to evolve and encourage career development at every stage of the employee lifecycle."
    • The solution, which won't be generally available until 2H16, is said to integrate with both Workday's (WDAY -3.6%) HCM and financials apps to provide "complete visibility into day-to-day learning activities and overall learning effectiveness," and to "make tailored learning recommendations based on who [users] are, what they do, and their stage in the employee lifecycle."
    • The solution will compete with offerings from Workday partners Cornerstone OnDemand (CSOD +0.8%) and Saba Software; Workday promises to continue supporting joint customers. Cornerstone, whose cloud talent management software platform includes a learning product, fell 4.1% yesterday on Workday-related concerns. JMP has defended the company.
    • Two days ago: Workday's European customer count tops 100, IBM buys Workday partner
    | Sep. 30, 2015, 2:50 PM
  • Sep. 28, 2015, 4:10 PM
    • Workday (NYSE:WDAY) states over 100 firms headquartered in Europe are now users of the company's cloud HR and/or finance apps. Clients include pharma giants AstraZenaca and Sanofi, and browser maker Opera.
    • Workday's global client base topped 1,000 in the July quarter, and (much like many other cloud software firms) still skews heavily towards U.S.-based firms. Oracle has previously asserted its win rates against Workday are much higher internationally due to having a bigger edge in sales and distribution reach.
    • Shares fell 2.8% in regular trading. The Nasdaq fell 3%.
    • Update: In other Workday-related news, IBM has announced it's buying Meteorix, a provider of consulting/implementation services for Workday apps.
    | Sep. 28, 2015, 4:10 PM | 1 Comment
  • Aug. 27, 2015, 12:55 PM
    • Workday (NYSE:WDAY) plunged 10% last night after beating estimates, but guiding light on full-year revenues. Alongside another major rally in the broad markets, the stock has reversed course, and is currently higher by 3.1%.
    • Citigroup's Walter Pritchard upgrades to Buy from Neutral. His $93 price target is about 20% higher than the current level. Noting the stock had traded at an "unjustifiable premium" to high-growth peers, Pritchard says the valuation is now more reasonable.
    • Cantor Fitzgerald and Canaccord reiterate their Buy ratings and respective $125 and $100 price targets, while FBN and Nomura reiterate Sector Perform/Neutral ratings and cut their price targets to $80 from $95, and to $90 from $105, respectively.
    • Nomura's Fred Grieb: “Both billings and total revenues were above expectations, although we note that growth for both has slowed."
    • Previously: Workday sees 51% FQ2 billings growth; customer count tops 1K (updated) (Aug. 26)
    | Aug. 27, 2015, 12:55 PM
  • Aug. 26, 2015, 5:24 PM
    • After briefly rising, Workday (NYSE:WDAY) is now down 0.7% after hours after posting an FQ2 beat and guiding in-line. Shares rose 3.5% in regular trading as markets surged.
    • Though Workday didn't provide a non-GAAP EPS number in its FQ2 report, it did state non-GAAP net income was $3.8M. That implies EPS of $0.02, above a -$0.06 consensus.
    • The cloud HCM/financials leader says it topped 1K customers during FQ2; it ended FQ1 with 925+. Subscription revenue rose 56% Y/Y to $223.7M, and professional services revenue 37% to $58.9M. On the earnings call, Workday states billings rose 51% Y/Y (even with revenue growth), and that FQ2 win rates were above FQ1 levels. The unearned revenue balance rose 42% Y/Y to $683.1M.
    • Free cash flow was -$10.3M, but totals $77.6M for the trailing 12 months. GAAP costs/expenses rose 41% Y/Y to $350.4M - sales/marketing spend totaled $106.4M, and R&D $115.3M. Workday ended FQ2 with $1.9B in cash/investments, and $502M in convertible debt.
    • Workday Planning, a budgeting/forecasting app that pushes the company deeper into the traditional ERP software market (SAP's historical stronghold), will become generally available next year.
    • FQ2 results/FQ3 guidance, PR
    • Update (5:30PM ET): Workday has guided on its call for FY16 (ends Jan. '16) revenue of $1.15B-$1.158B, above a $1.14B consensus. Shares now -3.3% AH.
    | Aug. 26, 2015, 5:24 PM | 2 Comments
  • Aug. 26, 2015, 4:07 PM
    • Workday (NYSE:WDAY): FQ2 GAAP EPS of -$0.37 not comparable with -$0.06 non-GAAP consensus.
    • Revenue of $282.7M (+51.4% Y/Y) beats by $8.63M.
    • Expects FQ3 revenue of $300M-$303M (+39%-41% Y/Y) vs. a $302.1M consensus.
    • Shares nearly flat after hours.
    • Update (4:23PM ET): Workday is now up 5.4%.
    • Update 2 (5:25PM ET): Workday has given back its gains: Shares are now down 0.7%. More details on the FQ2 report here.
    • Update 3 (5:38PM ET): Shares are now down 4.8%.
    | Aug. 26, 2015, 4:07 PM
Company Description
Workday, Inc. provides enterprise cloud applications for human capital management, payroll, financial management and analytics. It offers innovative and adaptable technology focused on the consumer Internet experience and cloud delivery model. The company applications are designed for global... More
Sector: Technology
Industry: Application Software
Country: United States