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Jan 31, 2023
Workday Q4 2023 Earnings Report
Announced Q4 2023 and full year financial results, demonstrating growth in total revenues and subscription revenues.
Key Takeaways
Workday reported a solid Q4 2023 with total revenues of $1.65 billion, up 19.6% year-over-year, and subscription revenues of $1.50 billion, up 21.7% year-over-year. The company's 24-month subscription revenue backlog reached $9.68 billion, a 21.3% increase year-over-year, and the total subscription revenue backlog was $16.45 billion, up 28.4% year-over-year.
Total revenues increased by 19.6% year-over-year to $1.65 billion.
Subscription revenues grew by 21.7% year-over-year to $1.50 billion.
24-month subscription revenue backlog increased by 21.3% year-over-year to $9.68 billion.
Total subscription revenue backlog increased by 28.4% year-over-year to $16.45 billion.
Workday
Workday
Workday Revenue by Segment
Revenue by Segment
Subscription Services Revenue
CapyFin.comProfessional Services Revenue
CapyFin.com Forward Guidance
Workday expects fiscal year 2024 subscription revenue to be between $6.525 billion and $6.575 billion, representing growth of 17% to 18%. The company also anticipates a non-GAAP operating margin of 23.0%, which includes a 150 basis point increase resulting from a change in their useful life policy for servers and network equipment.
Positive Outlook
- Maintaining the midpoint of preliminary fiscal year 2024 subscription revenue guidance.
- Increasing fiscal year 2024 non-GAAP operating margin outlook to the high end.
- Expecting subscription revenue of $6.525 billion to $6.575 billion, representing 17% to 18% growth.
- Anticipating non-GAAP operating margin of 23.0%, including a 150 basis point increase from a change in useful life policy.
- Strong fourth quarter execution.
Challenges Ahead
- The environment will remain uncertain in the near-term.
- Unspecified risks related to macroeconomic events, security measures, service outages, competition, and regulatory factors.
- Potential delays or reductions in information technology spending.
- Changes in sales may not be immediately reflected in results due to the subscription model.
- Any unreleased services, features, or functions are subject to change at Workday’s discretion and may not be delivered as planned or at all.
Revenue & Expenses
Visualization of income flow from segment revenue to net income