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Robert Chen
Workday’s fourth quarter financial results topped market estimates despite a slight slowdown in the company’s subscription revenue growth.
The software-as-a-service provider reported a net loss of $89 million, or 42 cents per share.
Non-GAAP earnings were 28 cents per share on revenue of $582.5 million, up 33 percent annually. Subscription revenue was $490 million, an increase of 34 percent from the same period last year.
Wall Street was expecting Q2 earnings of 20 cents per share on revenue of $573.69 million.
Total revenue for the year was $2.1 Billion, up 36.1 percent from a year ago, with non-GAAP earnings of $1.03 per share.
Despite the earnings beat, Workday’s share slipped slightly after hours. Workday CEO and co-founder Aneel Bhusri said the company said the quarter was bolstered by sales of its financial management software to two customers in the Fortune 500.
“Our fourth quarter capped a very strong year of growth where we continued to show momentum across our subscription revenue growth drivers, while also demonstrating the strength of our business model with record operating margins and cash flow,” added Workday CFO Robynne Sisco. “As we look ahead, our market position continues to strengthen giving us increasing confidence in the durability of growth over time.
Looking ahead, Workday said it’s raising fiscal 2019 outlook and now expects subscription revenue of $2.265 to $2.280 billion, or growth of between 27 to 28 percent. Details were not yet available on the company’s outlook for the current quarter or fiscal year. However, analysts are looking for Q1 earnings of 29 cents a share on revenue of $600 million.
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