Workday(WDAY) - 2024 Q4 - Annual Results

Revenue Growth - Fiscal 2024 Q4 total revenues were $1.9 billion, up 17% YoY, with subscription revenues of $1.8 billion, up 18% YoY[2][5] - Fiscal 2024 full-year total revenues were $7.3 billion, up 17% YoY, with subscription revenues of $6.6 billion, up 19% YoY[2][5] - Total revenues for the year ended January 31, 2024, increased to $7.259 billion, up from $6.216 billion in 2023, representing a 16.8% growth[24] - Subscription services revenue grew to $6.603 billion in 2024, a 18.6% increase compared to $5.567 billion in 2023[24] Cash Flow and Financial Position - Operating cash flows for fiscal 2024 were $2.1 billion, up 30% YoY, with free cash flows of $1.9 billion, up 46% YoY[5] - Cash and cash equivalents increased to $2.012 billion as of January 31, 2024, up from $1.886 billion in 2023[22] - Net cash provided by operating activities for the year ended January 31, 2024, was $2.149 billion, up from $1.657 billion in 2023[26] - Free cash flow for Q1 2024 was $948 million, compared to $617 million in Q1 2023[35] - Free cash flow for the fiscal year ended January 31, 2024, was $1.917 billion, compared to $1.293 billion in the previous fiscal year[35] Subscription Revenue Backlog - Total subscription revenue backlog reached $20.9 billion, up 27% YoY, with 12-month backlog at $6.6 billion and 24-month backlog at $11.7 billion, both up 20% YoY[5] Share Repurchase and Capital Allocation - Workday repurchased 1.8 million shares of Class A common stock for $423 million as part of its share repurchase program[5] - Workday's Board of Directors approved a new 18-month share repurchase program to repurchase up to an additional $500 million of Class A common stock[8] Leadership and Organizational Changes - Workday named Carl Eschenbach CEO effective February 1, 2024, with Aneel Bhusri transitioning to co-founder and executive chair[8] Acquisitions and Strategic Investments - Workday announced the acquisition of HiredScore, a leading provider of AI-powered talent orchestration solutions[8] Financial Performance and Margins - Workday reiterated fiscal 2025 subscription revenue guidance of $7.725 billion to $7.775 billion, representing 17% to 18% growth, with a non-GAAP operating margin of approximately 24.5%[6] - GAAP operating income for Q1 2024 was $79 million, with a non-GAAP operating income of $461 million, reflecting an operating margin of 23.9%[29] - For the fiscal year ended January 31, 2024, GAAP operating income was $183 million, with a non-GAAP operating income of $1.740 billion, reflecting an operating margin of 24.0%[29] - Net income for the year ended January 31, 2024, was $1.381 billion, a significant improvement from a net loss of $367 million in 2023[24] - Net income for Q1 2024 was $1.188 billion on a GAAP basis and $421 million on a non-GAAP basis, with diluted earnings per share of $4.42 (GAAP) and $1.57 (non-GAAP)[29] - Net income for the fiscal year ended January 31, 2024, was $1.381 billion on a GAAP basis and $1.549 billion on a non-GAAP basis, with diluted earnings per share of $5.21 (GAAP) and $5.84 (non-GAAP)[29] Balance Sheet and Liabilities - Workday's cash, cash equivalents, and marketable securities totaled $7.8 billion as of January 31, 2024[5] - Total assets grew to $16.452 billion in 2024, compared to $13.486 billion in 2023, a 22% increase[22] - Total current liabilities increased to $5.055 billion in 2024, up from $4.628 billion in 2023[22] - Unearned revenue grew to $4.057 billion in 2024, up from $3.559 billion in 2023, a 14% increase[22] - Total stockholders' equity increased to $8.082 billion in 2024, compared to $5.585 billion in 2023, a 44.7% growth[22] Capital Expenditures - Total capital expenditures for Q1 2024 were $48 million, including $46 million for capital expenditures excluding owned real estate projects and $2 million for owned real estate projects[35] - Total capital expenditures for the fiscal year ended January 31, 2024, were $232 million, including $228 million for capital expenditures excluding owned real estate projects and $4 million for owned real estate projects[36] Share-Based Compensation - Share-based compensation expenses for the year ended January 31, 2024, totaled $1.416 billion, compared to $1.295 billion in 2023[24] - Share-based compensation expenses for Q1 2024 were $346 million, contributing to the adjustment from GAAP to non-GAAP operating income[29] Tax Rate - The non-GAAP tax rate for fiscal 2024 and 2023 was 19%, reflecting a fixed long-term projected tax rate[33]