Workday’s FY24 marked by “momentum with full platform customer wins”

image of Workday building | VNDLY

Workday has announced its fiscal 2024 fourth quarter and full-year results, boosted by more leaders turning to the company to manage their people and money. 

For the quarter ended January 31, 2024, total revenues reached $1.922bn, a 17 percent jump from the fourth quarter of fiscal 2023, which narrowly topped analyst consensus estimate of $1.917bn.

Workday’s CEO Carl Eschenbach described the successful quarter and fiscal year as “a testament to the strength of the value proposition and the durability of the business,” with him adding:

“We’re seeing continued momentum with full platform customer wins and expansions within our base, strengthening international performance, growth of our partner ecosystem and the seamless execution of nearly 19,000 Workmates across the globe – all setting us up for an incredible fiscal year 2025.”

The year saw Workday’s operating income reach $183m, or 2.5 percent of revenues, compared to an operating loss of $222m, or negative 3.6 percent of revenues, the year before. 

Total subscription revenue backlog was also up 27 percent year-on-year (YoY) to $20.9bn while 12-month subscription revenue backlog was $6.6bn and 24-month subscription revenue backlog – $11.7bn, both increasing 20 percent YoY.

The CEO, who recently took the helm as a solo lead amid the company’s succession plan, also highlighted in the earnings call that Workday has made key investments across its leadership team, go-to-market and partner ecosystem and platform, positioning it to “drive enduring growth in FY ’25 and beyond”.

He also emphasized: “With the emergence of AI, shifting talent, landscape and pressure to realize operational efficiencies, leaders are turning to Workday as their trusted platform to manage their most critical assets – their people and their money. 

“Customers have come to trust us with helping them navigate these huge transformations from the cloud to AI.”

To further accelerate its AI roadmap, Workday also announced its planned acquisition of Israel-based software company HiredScore which provides AI-powered talent orchestration solutions. 

As HiredScore’s technology delivers data-driven insights to help improve recruiting and internal mobility processes, Workday hopes that the combination of its data set and Workday Skills Cloud with HiredScore’s solution will provide customers with a transparent AI-powered talent acquisition and internal mobility offering. 

Listing some new wins over the quarter, Workforce saw strength in full-platform deals with customers like Australian Stock Exchange, Boyd Gaming Corporation, HHS, Randstad, UHS of Delaware and VXI Global Solutions as full-platform HCM and financials customers.

Some new HCM customers this quarter also included Crane Company, El Corte Inglés, Hitachi Astemo, Hungry Jack’s, Kohler, Onset and Swisscom.

As the fourth quarter and full-year fiscal 2024 results reflected momentum across investment initiatives, Zane Rowe, CFO of Workday, said: “We are reiterating our fiscal year 2025 subscription revenue guidance of $7.725bn to $7.775bn, representing growth of 17 percent to 18 percent. We expect a fiscal year 2025 non-GAAP operating margin of approximately 24.5 percent. 

“Our outlook contemplates incremental investments to support enduring growth, while at the same time calls for continued margin expansion as we scale and optimize the business.”