Group 1 - The 13D Activist Fund reported a Q3 2025 return of 8.88%, underperforming the Russell 2000 Index which returned 12.39% [1] - The Russell 2000 outperformed the S&P 500 by the largest margin in three years, with returns of 12.39% compared to the S&P 500's 8.12% [1] - The fund expressed satisfaction with its performance but acknowledged the need for improvement relative to the market [1] Group 2 - Workiva Inc. (NYSE:WK) was highlighted as a key investment, with a one-month return of 5.95% and a 52-week loss of 8.65% [2] - As of December 03, 2025, Workiva Inc. had a stock price of $92.08 and a market capitalization of $5.168 billion [2] - The fund noted that Irenic Capital, an activist investor, has been involved with Workiva Inc. and focuses on strategic activism, including recommendations for spinoffs and sales of businesses [3]

Core Insights - Workiva Inc. has demonstrated strong revenue growth, with a reported 21% increase in revenue to $224 million in the most recent quarter, alongside a GAAP profit of $3 million, a significant improvement from a $17 million loss a year prior [6] - Praesidium Investment Management Company has initiated a new position in Workiva, acquiring 87,921 shares valued at approximately $7.6 million, representing about 1.5% of the fund's total U.S. equity assets [2][8] - Despite a 7.5% decline in share price over the past year, Workiva's improving subscription revenue, which rose by 23%, and expanding non-GAAP operating margin to 12.7% from 4.1% indicate a positive trend towards sustainable profitability [6][7] Company Overview - Workiva Inc. specializes in cloud-based software for enterprise compliance and regulatory reporting, providing scalable solutions that support digital transformation in financial and operational processes [5] - The company's market capitalization stands at $5.1 billion, with a trailing twelve months (TTM) revenue of $845.5 million and a net income loss of $46.8 million [4] Investment Context - The recent filing by Praesidium suggests a growing conviction in Workiva's potential, particularly in light of the company's valuation reset and shift towards higher-value enterprise contracts [8] - Workiva's stock remains over 40% below its 2021 highs, indicating a potential opportunity for long-term investors despite its recent underperformance compared to the S&P 500, which has increased by 13% in the same period [3][7]

Core Insights - Workiva Inc. has appointed Deepak Bharadwaj as EVP & Chief Product Officer to enhance its AI-powered platform innovation [1][2] - Bharadwaj brings over 25 years of experience in product leadership, having previously worked at Adobe and ServiceNow [2][3] - The company aims to leverage Bharadwaj's expertise to drive product growth and customer value [2][3] Company Overview - Workiva Inc. is a leading AI-powered platform focused on transparency, accountability, and trust, serving over 6,500 organizations, including more than 85% of Fortune 1,000 companies [4] - The platform transforms how customers connect data, unify processes, and empower teams in a secure, audit-ready environment [4] Leadership Background - Deepak Bharadwaj has held significant roles in product management at major technology firms, including Adobe, where he led the launch of Acrobat Studio, and ServiceNow, where he contributed to high-growth Employee Experience products [2][3] - His educational background includes a bachelor's degree in computer engineering, a master's in computer science, and an MBA from The Wharton School [3]

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Core Insights - Workiva has reported strong quarterly operating results, with a significant increase in demand for its platform from large organizations, leading to an upward revision of its full-year revenue forecast [2][8]. Financial Performance - Workiva generated $224 million in total revenue during Q3 2025, representing a 21% year-over-year increase, surpassing management's forecast of $218 million to $220 million [7]. - The company increased its full-year revenue guidance from $871.5 million to $881 million [8]. - Workiva's net revenue retention rate was 114%, indicating existing customers spent 14% more compared to the same period last year [10]. Customer Growth - A record 2,372 of Workiva's 6,541 customers had contract values of at least $100,000 by the end of Q3, showcasing the platform's importance to large organizations [8]. - The number of customers with annual contract values of at least $300,000 and $500,000 increased by 41% and 42% year-over-year, respectively [10]. Market Position and Valuation - Workiva's stock is currently trading 48% below its 2021 record high, with analysts suggesting it may be a good time to buy [3][13]. - The average price target from analysts is $97.60, with a potential upside of 11%, while the highest target suggests a 25% return [11]. - The company's price-to-sales (P/S) ratio has decreased to 5.6, down from 20 at its peak in 2021, indicating a more attractive valuation [13]. Technology and Innovation - Workiva is enhancing its platform with AI capabilities, including the introduction of Workiva AI, which assists managers in customizing reports and disclosures [4][6]. - The AI assistant is designed to understand the context of documents stored on the platform, streamlining workflows for users [6]. Market Opportunity - Workiva estimates its total addressable market at $35 billion, suggesting significant growth potential as it has only begun to tap into this opportunity [12].

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Core Insights - Workiva reported revenue of $224.17 million for the quarter ended September 2025, marking a year-over-year increase of 20.8% and exceeding the Zacks Consensus Estimate of $219.11 million by 2.31% [1] - The company achieved an EPS of $0.55, significantly higher than the $0.21 reported a year ago, and surpassed the consensus EPS estimate of $0.38 by 44.74% [1] Revenue Breakdown - Subscription and support revenue reached $209.56 million, exceeding the average analyst estimate of $205.19 million, reflecting a year-over-year increase of 22.5% [4] - Professional services revenue was reported at $14.61 million, slightly above the average estimate of $14.02 million, with a minimal year-over-year change of 0.1% [4] Profitability Metrics - Non-GAAP gross profit from professional services was $3.15 million, surpassing the average estimate of $2.77 million [4] - Non-GAAP gross profit from subscription and support was $179.32 million, exceeding the average estimate of $171.89 million [4] Stock Performance - Workiva's shares have returned -4.3% over the past month, contrasting with the Zacks S&P 500 composite's +1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Financial Performance - Workiva reported quarterly earnings of $0.55 per share, exceeding the Zacks Consensus Estimate of $0.38 per share, and up from $0.21 per share a year ago, representing an earnings surprise of +44.74% [1] - The company posted revenues of $224.17 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 2.31%, compared to year-ago revenues of $185.62 million [2] Earnings Outlook - The current consensus EPS estimate for the coming quarter is $0.62 on revenues of $230.99 million, and for the current fiscal year, it is $1.34 on revenues of $871.58 million [7] - The estimate revisions trend for Workiva was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Internet - Software industry, to which Workiva belongs, is currently in the top 34% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Data and Key Metrics Changes - In Q3 2025, total revenue reached $224 million, reflecting a 21% increase compared to Q3 2024, exceeding the high end of revenue guidance by $4 million [28] - Subscription revenue was $210 million, up 23% year-over-year, with new customers accounting for 40% of the increase [28] - Non-GAAP operating margin for the quarter was 12.7%, a 470 basis point improvement on the high end of guidance and an 860 basis point increase compared to Q3 2024 [6][29] Business Line Data and Key Metrics Changes - The number of contracts valued over $100,000 increased by 23%, contracts over $300,000 rose by 41%, and those over $500,000 grew by 42% compared to Q3 2024 [6][30] - 73% of subscription revenue came from customers using multiple solutions, up from 68% in Q3 2024 [29] Market Data and Key Metrics Changes - Revenue from international markets represented over 19% of total revenue, up from 17% a year ago, with strong demand across Europe [49] - The company supported several high-profile IPOs in Q3, indicating a positive trend in capital markets activity [17] Company Strategy and Development Direction - The company is focused on durable growth and improved operating leverage, with a commitment to innovation and customer needs [5][21] - Recent product enhancements include AI-powered solutions aimed at increasing customer speed, agility, and confidence [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing macroeconomic uncertainties but emphasized the resilience of the business and the importance of providing transparency and accountability [50] - The company raised its full-year revenue guidance to $880 million-$882 million, reflecting strong performance and a commitment to operational efficiency [32] Other Important Information - A leadership change was announced with Michael Pinto appointed as the new Executive Vice President and Chief Revenue Officer, focusing on scaling and accelerating profitable growth [25][60] - The company is transitioning to a flexible time-off plan in 2026, which is expected to positively impact operating margin [31] Q&A Session Summary Question: Insights on platform sales and consolidation trends - Management confirmed a trend towards consolidation in the Office of the CFO, highlighting the benefits of a unified platform [38][39] Question: Early indicators on new pricing strategy - Management noted that early indicators are positive, contributing to account expansions [40] Question: Operating margin outlook for 2026 - Management expects continued progress towards medium-term targets, with a focus on productivity and operational efficiency [44] Question: Demand environment and capital markets activity - Management reported consistent uncertainty in the market but noted strong revenue and bookings growth, with optimism for continued momentum post-government shutdown [50][48] Question: Update on sustainability demand - Management indicated that while near-term tailwinds have subsided, demand for sustainability solutions remains strong, driven by business performance and risk management [56][54]

Financial Performance & Growth - Workiva's Q3 2025 subscription revenue reached $210 million, representing a 23% year-over-year growth[71,72] - The company's remaining performance obligation (RPO) grew by 21% year-over-year, reaching $1305 million in Q3 2025[74] - Workiva's Q3 2025 gross retention rate was 97%, and the net retention rate was 114%[72] - The company projects total revenue for Q4 2025 to be between $234 million and $236 million, representing a 172% to 182% year-over-year growth[84] - Workiva anticipates full-year 2025 total revenue to be between $880 million and $882 million, a 191% to 194% increase year-over-year[84] Customer Base & Expansion - Workiva has over 6,500 organizations using its platform globally[8,43,52,64] - The number of large annual contract value (ACV) customers is growing, with 2,372 customers having >$100k ACV, 541 customers having >$300k ACV and 236 customers having >$500k ACV in Q3 2025[79] - Subscription revenue from multi-solution customers is increasing, reaching 73% in Q3 2025[82] Strategic Focus & Market Opportunity - Workiva estimates its total addressable market (TAM) to be $35 billion[14,16] - Sustainability management represents 20% of Workiva's total TAM[18,19] - The company's strategy focuses on a connected AI platform, fit-for-purpose solutions, a partner ecosystem, and global expansion[11]