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Jul 31, 2020

Workday Q2 2021 Earnings Report

Workday's Q2 2021 financial performance showed strong growth with increased subscription revenue and raised fiscal year guidance.

Key Takeaways

Workday announced strong Q2 2021 results with total revenues of $1.06 billion, up 19.6% year-over-year, and subscription revenue of $931.7 million, up 23.1% year-over-year. The company raised its fiscal 2021 subscription revenue guidance to a range of $3.73 billion to $3.74 billion and non-GAAP operating margin guidance to 18.0%.

Total revenues increased by 19.6% year-over-year, reaching $1.06 billion.

Subscription revenue grew by 23.1% year-over-year, amounting to $931.7 million.

The company raised its fiscal 2021 subscription revenue guidance to $3.73 billion - $3.74 billion.

Non-GAAP operating margin for the quarter was 24.3% and the company raised its fiscal 2021 non-GAAP operating margin guidance to 18.0%.

Total Revenue
$1.06B
Previous year: $888M
+19.6%
EPS
$0.84
Previous year: $0.44
+90.9%
Subscription Revenue Backlog
$8.6B
Previous year: $7.03B
+22.3%
Gross Profit
$778M
Cash and Equivalents
$1.24B
Total Assets
$7.5B

Workday

Workday

Workday Revenue by Segment

Forward Guidance

Workday is raising its fiscal 2021 subscription revenue guidance to a range of $3.73 billion to $3.74 billion. The company expects third-quarter subscription revenue of $948.0 million to $950.0 million. Workday is also raising its fiscal 2021 non-GAAP operating margin guidance to 18.0%.

Positive Outlook

  • Raising fiscal 2021 subscription revenue guidance to $3.73B - $3.74B.
  • Expecting Q3 subscription revenue of $948M - $950M.
  • Raising fiscal 2021 non-GAAP operating margin guidance to 18.0%.
  • Continued demand for our products.
  • Delivering new solutions that extend the power of Workday.

Challenges Ahead

  • Impact of the ongoing COVID-19 pandemic on our business.
  • Breaches in our security measures.
  • Service outages.
  • Adverse changes in general economic or market conditions.
  • Changes in sales, which may not be immediately reflected in our results due to our subscription model.

Revenue & Expenses

Visualization of income flow from segment revenue to net income