The financials for Workday Q2 2024 are out, with $1.79bn in total revenues declared and a clear sentiment of customer trust guiding the company’s messaging to investors.
Total revenues for Workday Q2 2024 showed an increase of 16.3 percent from the second quarter of fiscal 2023. The period for the fiscal 2024 second quarter ended July 31, 2023 also saw operating income of $36.3m, or 2.0 percent of revenues, compared to an operating loss of $34.1m, or negative 2.2 percent of Workday revenues, in the same period last year.
Non-GAAP operating income for Workday Q2 2024 was $421.4m, or 23.6 percent of revenues, compared to a non-GAAP operating income of $301.6m, or 19.6 percent of revenues, in the same period last year.
The company has also surpassed 65 million users with more than 5,000 core Workday Financial Management and Workday HCM customers.
The earnings call from Workday came with extra details, highlighting Gartner research published in Q2 which declared Workday as having the highest worldwide market share in 2022 for SaaS ERP, at 21 percent. The quarter also saw Workday finish with a headcount of almost 17,900 global workers (or “Workmates”), but it’s not clear what percentage change this figure represents.
Workday’s rising EMEA footprint – as headlined late last year with its surpassing of 2000 customers in Europe – came bolstered by recognition of new leadership talent in the region by co-CEO Carl Eschenbach during the earnings call.
“We’ve brought in a lot of new leadership across the region, both in the UK [and] at the entire EMEA level,” said Eschenbach. “They’re actually bringing in more and more talent underneath them and it is starting to clearly pay dividends. We are seeing early signs of solid pipeline build, you know, that’s much more predictable than we’ve seen in the past. We see more predictability in the business because they have their arms around it, and they are selling both HCM and FINS successfully. ”
Eschenbach also noted a similarity between the company’s EMEA and U.S. arms in Workday’s appeal to medium enterprise businesses, which mainly defined the EMEA story during Workday Q2.
“They’re doing really well at selling full platforms into the EMEA market,” he continued, “where customers see the true value of combining both HCM and financials and…wrapping planning around it for that full-platform sale. So, we definitely are seeing the momentum there, and we do have some big competitors in our backyard there.”
Workday Q2 all about “trust”
The CEOs of Workday also peppered their earnings call messaging with the word “trust”, with customer trust put down as a key explanation for the growth in Workday Q2.
“Our customers, now representing more than 65 million users under contract, are all in on Workday because they trust us to manage their two most important assets: their people and their money,” as Eschenbach said.
Co-CEO and co-founder Aneel Bhusri, ever the “techie” of the duo, took it a step further by elaborating on Workday’s AI prowess in this era of ChatGPT and ethical AI wariness, a messaging from Workday which ERP Today picked up on at a recent Elevate event.
“More and more organizations are looking to Workday to be their trusted partner to help them navigate today’s business landscape and thrive in this new world of work,” said Bhusri. “Critical to our ability to be that trusted partner is our continued focus on artificial intelligence and machine learning, including generative AI.”
“AI and ML are embedded into the core of our platform; we place an emphasis on being human-centric with our AI and ML strategy, and we continue to believe the true potential of AI and ML can only be met by ensuring that is leveraged in a trustworthy and ethical way. Looking ahead, generative AI will continue to be a major focus for us.”
Workday’s patter isn’t all talk, either – Q2 saw the company work with policymakers to help shape the European Parliament’s amendments to the proposed AI Act by building on the trust element. In other words, Workday may come out as the surprising AI leader within enterprise tech and ERP, especially once Bhusri steps back from the CEO chair as planned next year to focus solely on product strategy for the brand.
