Workiva(WK)2024-11-06 21:20Revenue and Growth - Total revenues for the three months ended September 30, 2024, were $185.621 million, an increase from $158.175 million in the same period of 2023, representing a growth of 17.4%[70]. - Subscription and support revenue for the three months ended September 30, 2024, was $171.035 million, up from $143.421 million in the same period of 2023, reflecting a growth of 19.3%[70]. - The company reported revenue of $185.6 million and $538.8 million for the three and nine months ended September 30, 2024, respectively, compared to $158.2 million and $463.4 million for the same periods in 2023, representing growth of 17.3% and 16.3%[93]. - Total revenue for the three months ended September 30, 2024, increased by $27.4 million, primarily due to a $27.6 million increase in subscription and support revenue, reflecting a growth rate of 19.3% year-over-year[130]. - Total revenue for the nine months ended September 30, 2024, increased by $75.4 million, primarily due to a $76.9 million increase in subscription and support revenue[131]. - The company expects the revenue growth rate from subscription and support to continue to outpace revenue growth from professional services on an annual basis[130]. Expenses and Costs - Total interest expense for the three months ended September 30, 2024, was $3.003 million, compared to $2.090 million for the same period in 2023[59]. - Stock-based compensation expense for the three months ended September 30, 2024, totaled $27.470 million, compared to $19.377 million for the same period in 2023[64]. - Operating expenses for the three months ended September 30, 2024, totaled $163,732 thousand, representing a 21.0% increase compared to $135,345 thousand in the same period of 2023[135]. - Research and development expenses increased by 16.0% to $48,425 thousand for the three months ended September 30, 2024[135]. - Sales and marketing expenses rose by 23.7% to $89,756 thousand for the three months ended September 30, 2024[135]. - General and administrative expenses increased by $4.5 million (approximately 8.0%) for the three months ended September 30, 2024, mainly due to higher stock-based compensation[140]. Cash and Securities - As of September 30, 2024, total cash equivalents and marketable securities amounted to $637.8 million, with $109.7 million included in cash and cash equivalents[35]. - As of September 30, 2024, the company had cash, cash equivalents, and marketable securities totaling $776.4 million[147]. - Cash flow provided by operating activities was $18.9 million for the three months ended September 30, 2024, compared to $15.0 million for the same period in 2023[151]. - Cash used in investing activities was $49.6 million for the three months ended September 30, 2024, primarily for marketable securities purchases and the acquisition of Sustain.Life[158]. Customer Metrics - The number of customers increased to 6,237 as of September 30, 2024, up from 5,945 in 2023[107]. - Subscription and support revenue retention rate was 97.5% as of September 30, 2024, slightly down from 97.7% in the previous year[109]. - Subscription and support revenue from customers with annual contract value of $100k+ represented 71.8% of total subscription and support revenue for the three months ended September 30, 2024, up from 67.1% in 2023[113]. - Subscription and support revenue retention rate including add-ons was 110.5% as of September 30, 2024, down from 112.0% in the previous year[112]. Acquisitions and Investments - The company acquired Sustain.Life, Inc. for $98.1 million, enhancing its carbon accounting solutions and integrating it with its existing ESG reporting platform[81]. - The company incurred acquisition-related costs of approximately $1.1 million during the nine months ended September 30, 2024, which were expensed as incurred[83]. - The company plans to continue investing in platform development and expanding its sales and marketing efforts in EMEA and APAC regions[103]. Financial Position and Liabilities - Accrued expenses and other current liabilities totaled $111.0 million as of September 30, 2024, compared to $97.9 million as of December 31, 2023[34]. - Estimated health insurance claims decreased from $3.5 million as of December 31, 2023, to $2.4 million as of September 30, 2024[34]. - Customer deposits increased from $24.8 million as of December 31, 2023, to $25.7 million as of September 30, 2024[34]. - The fair value of convertible senior notes due in 2026 and 2028 was $82.4 million and $659.7 million, respectively, classified as Level 2 in the fair value hierarchy[47]. Market and Economic Conditions - The company expects continued volatility in the IPO and SPAC markets to negatively impact new sales of SEC and capital markets solutions in fiscal year 2024[96]. - Market risk exposures have not changed materially since December 31, 2023[169].