Workiva Inc. Announces Third Quarter 2024 Financial Results

  • Increased Q3 2024 Subscription & Support Revenue by 19% over Q3 2023
  • Total revenue of $186 million in Q3 2024, representing 17% year-over-year growth
  • Achieved 28% YOY Growth of Customers with Annual Contract Value Over $500K

NEW YORK--(BUSINESS WIRE)--Nov. 6, 2024-- Workiva Inc. (NYSE:WK), the world’s leading cloud platform for assured integrated reporting, today announced financial results for its third quarter ended September 30, 2024.

"Workiva is once again in a beat and raise position. Our results highlight an acceleration of our growth and improved operating leverage," said Julie Iskow, President & Chief Executive Officer. "We delivered another record bookings quarter with broad based demand across the entire solution portfolio and a high volume of account expansion deals and platform wins across North America and Europe."

"Subscription and support revenue growth of 19% drove our total revenue beat to $2.6 million over the high end of our guidance range," said Jill Klindt, Chief Financial Officer. "Due to our solid performance, we are raising our total revenue guidance by $6 million to a range of $733 million to $735 million."

Third Quarter 2024 Financial Results

  • Revenue: Total revenue for the third quarter of 2024 reached $186 million, an increase of 17% from $158 million in the third quarter of 2023. Subscription and support revenue contributed $171 million, up 19% versus the third quarter of 2023. Professional services revenue was $15 million, relatively flat compared to the same quarter in the prior year.
  • Gross Profit: GAAP gross profit for the third quarter of 2024 was $142 million compared with $120 million in the same quarter of 2023. GAAP gross margin was 76.5% versus 75.8% in the third quarter of 2023. Non-GAAP gross profit for the third quarter of 2024 was $146 million, an increase of 20% compared with the prior year's third quarter, and non-GAAP gross margin was 78.6% compared to 76.9% in the third quarter of 2023.
  • Results from Operations: GAAP loss from operations for the third quarter of 2024 was $22 million compared with a loss of $16 million in the prior year's third quarter. Non-GAAP income from operations was $8 million compared with non-GAAP income from operations of $5 million in the third quarter of 2023.
  • GAAP Net Loss: GAAP net loss for the third quarter of 2024 was $17 million compared with a net loss of $56 million for the prior year's third quarter. GAAP net loss per basic and diluted share was $0.31 compared with a net loss per basic and diluted share of $1.04 in the third quarter of 2023.
  • Non-GAAP Net Income/Loss: Non-GAAP net income for the third quarter of 2024 was $12 million compared with a net loss of $35 million in the prior year's third quarter. Non-GAAP net income per basic share and diluted share was $0.22 and $0.21, respectively, compared with a net loss per basic share and diluted share of $0.65 in the third quarter of 2023.
  • Liquidity: As of September 30, 2024, Workiva had cash, cash equivalents, and marketable securities totaling $776 million, compared with $814 million as of December 31, 2023. Workiva had $71 million aggregate principal amount of 1.125% convertible senior notes due in 2026, $702 million aggregate principal amount of 1.250% convertible senior notes due in 2028, and $14 million of finance lease obligations outstanding as of September 30, 2024.

Key Metrics and Recent Business Highlights

  • Customers: Workiva had 6,237 customers as of September 30, 2024, a net increase of 292 customers from September 30, 2023.
  • Revenue Retention Rate: As of September 30, 2024, Workiva's revenue retention rate (excluding add-on revenue) was 98%, and the revenue retention rate including add-on revenue was 111%. Add-on revenue includes changes in both solutions and pricing for existing customers.
  • Large Contracts: As of September 30, 2024, Workiva had 1,926 customers with an annual contract value (“ACV”) of more than $100,000, up 23% from 1,561 customers at September 30, 2023. Workiva had 383 customers with an ACV of more than $300,000, up 29% from 296 customers in the third quarter of 2023. Workiva had 166 customers with an ACV of more than $500,000, up 28% from 130 customers in the third quarter of 2023.

Financial Outlook

As of November 6, 2024, Workiva is providing guidance as follows:

Fourth Quarter 2024 Guidance:

  • Total revenue is expected to be in the range of $194 million to $196 million.
  • GAAP loss from operations is expected to be in the range of $16 million to $14 million.
  • Non-GAAP income from operations is expected to be in the range of $13 million to $15 million.
  • GAAP net loss per basic share is expected to be in the range of $0.21 to $0.18.
  • Non-GAAP net income per basic share is expected to be in the range of $0.31 to $0.34.
  • Net income (loss) per basic share is based on 55.8 million weighted-average shares outstanding.

Full Year 2024 Guidance:

  • Total revenue is expected to be in the range of $733 million to $735 million.
  • GAAP loss from operations is expected to be in the range of $79 million to $77 million.
  • Non-GAAP income from operations is expected to be in the range of $30 million to $32 million.
  • GAAP net loss per basic share is expected to be in the range of $1.05 to $1.02.
  • Non-GAAP net income per basic share is expected to be in the range of $0.93 to $0.96.
  • Net income (loss) per basic share is based on 55.4 million weighted-average shares outstanding.

Quarterly Conference Call

Workiva will host a webcast today at 5:00 p.m. ET to review the Company’s financial results for the third quarter 2024, in addition to discussing the Company’s outlook for the fourth quarter and full year 2024. The webcast will be available on https://investor.workiva.com/news-events/events. An archived webcast will also be available an hour after the completion of the call in the "Investor Relations" section of the Company’s website at www.workiva.com.

About Workiva

Workiva Inc. (NYSE:WK) is on a mission to power transparent reporting for a better world. We build and deliver the world’s leading cloud platform for assured integrated reporting to meet stakeholder demands for action, transparency, and disclosure of financial and non-financial data. Workiva offers the only unified SaaS platform that brings customers’ financial reporting, Governance, Risk, and Compliance (GRC), and Environmental, Social, and Governance (ESG) data together in a controlled, secure, audit-ready platform. Our platform simplifies the most complex reporting and disclosure challenges by streamlining processes, connecting data and teams, and ensuring consistency. Learn more at workiva.com.

Non-GAAP Financial Measures

The non-GAAP adjustments referenced herein relate to the exclusion of stock-based compensation and amortization of acquisition-related intangible assets. A reconciliation of GAAP to non-GAAP historical financial measures has been provided in Table I at the end of this press release. A reconciliation of GAAP to non-GAAP guidance has been provided in Table II at the end of this press release.

Workiva believes that the use of non-GAAP gross profit and gross margin, non-GAAP income (loss) from operations, non-GAAP net income (loss) and non-GAAP net income (loss) per share is helpful to its investors. These measures, which are referred to as non-GAAP financial measures, are not prepared in accordance with generally accepted accounting principles in the United States, or GAAP. Non-GAAP gross profit is calculated by excluding stock-based compensation expense attributable to cost of revenues from gross profit. Non-GAAP gross margin is the ratio calculated by dividing non-GAAP gross profit by revenues. Non-GAAP income (loss) from operations is calculated by excluding stock-based compensation expense and amortization expense for acquisition-related intangible assets from loss from operations. Non-GAAP net income (loss) is calculated by excluding stock-based compensation expense, net of tax and amortization expense for acquisition-related intangible assets from net loss. Non-GAAP net income (loss) per share is calculated by dividing non-GAAP net income (loss) by the weighted- average shares outstanding as presented in the calculation of GAAP net loss per share. Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a company’s non-cash expenses, Workiva believes that providing non-GAAP financial measures that exclude stock-based compensation expense allows for more meaningful comparisons between its operating results from period to period. For business combinations, we generally allocate a portion of the purchase price to intangible assets. The amount of the allocation is based on estimates and assumptions made by management and is subject to amortization. The amount of purchase price allocated to intangible assets and the term of its related amortization can vary significantly and are unique to each acquisition and thus we do not believe it is reflective of ongoing operations. Workiva’s management uses these non-GAAP financial measures as tools for financial and operational decision making and for evaluating Workiva’s own operating results over different periods of time.

Non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in Workiva’s industry, as other companies in the industry may calculate non-GAAP financial results differently. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact on Workiva’s reported financial results. Further, stock-based compensation expense has been and will continue to be for the foreseeable future a significant recurring expense in Workiva’s business and an important part of the compensation provided to its employees. The presentation of non-GAAP financial information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. Investors should review the reconciliation of non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate Workiva’s business.

Forward-Looking Statements

Certain statements in this press release are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or the Company’s future financial performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Company or its industry to be materially different from those expressed or implied by any forward-looking statements. In particular, statements about the Company’s expectations, beliefs, plans, objectives, assumptions, future events or future performance contained in this press release are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may," "will," "could," "would," "should," "expect," "plan," "anticipate," "intend," "believe," "estimate," "predict," "potential," "outlook," "guidance" or the negative of those terms or other comparable terminology.

Please see the Company’s documents filed or to be filed with the Securities and Exchange Commission, including the Company’s annual reports filed on Form 10-K and quarterly reports on Form 10-Q, and any amendments thereto for a discussion of certain important risk factors that relate to forward-looking statements contained in this report. The Company has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the Company’s control. These and other important factors may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Any forward-looking statements are made only as of the date hereof, and unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

WORKIVA INC. 

CONSOLIDATED STATEMENTS OF OPERATIONS 
(in thousands, except share and per share amounts)
 Three months ended September 30, Nine months ended September 30,
  2024   2023   2024   2023 
 (unaudited)
Revenue       
Subscription and support$171,035  $143,421  $486,749  $409,857 
Professional services 14,586   14,754   52,042   53,529 
Total revenue 185,621   158,175   538,791   463,386 
Cost of revenue       
Subscription and support (1) 30,621   24,864   86,493   74,080 
Professional services (1) 13,050   13,491   39,873   42,297 
Total cost of revenue 43,671   38,355   126,366   116,377 
Gross profit 141,950   119,820   412,425   347,009 
Operating expenses       
Research and development (1) 48,425   41,747   142,328   130,235 
Sales and marketing (1) 89,756   72,576   257,086   215,168 
General and administrative (1) 25,551   21,022   76,225   86,660 
Total operating expenses 163,732   135,345   475,639   432,063 
Loss from operations (21,782)  (15,525)  (63,214)  (85,054)
Interest income 9,298   7,294   30,089   15,546 
Interest expense (3,199)  (47,437)  (9,668)  (50,437)
Other expense, net (350)  (71)  (309)  (1,450)
Loss before provision for income taxes (16,033)  (55,739)  (43,102)  (121,395)
Provision for income taxes 959   530   3,125   1,934 
Net loss$(16,992) $(56,269) $(46,227) $(123,329)
Net loss per common share:       
Basic and diluted$(0.31) $(1.04) $(0.84) $(2.28)
Weighted-average common shares outstanding - basic and diluted 55,581,841   54,256,941   55,226,254   53,987,791 
                
(1) Includes stock-based compensation expense as follows:
 Three months ended September 30, Nine months ended September 30,
 2024 2023 2024 2023
 (unaudited)
Cost of revenue       
Subscription and support$2,164 $1,247 $5,708 $3,732
Professional services 858  623  2,348  1,923
Operating expenses       
Research and development 5,681  4,155  15,474  13,677
Sales and marketing 9,942  7,108  26,470  20,769
General and administrative 8,825  6,244  25,879  37,928
WORKIVA INC. 

CONSOLIDATED BALANCE SHEETS 
(in thousands)
 September 30, 2024 December 31, 2023
 (unaudited)  
Assets   
Current assets   
Cash and cash equivalents$248,239  $256,100 
Marketable securities 528,115   557,622 
Accounts receivable, net 137,921   125,193 
Deferred costs 44,726   39,023 
Other receivables 8,646   7,367 
Prepaid expenses and other 21,055   23,631 
Total current assets 988,702   1,008,936 
Property and equipment, net 21,757   24,282 
Operating lease right-of-use assets 9,485   12,642 
Deferred costs, non-current 43,557   33,346 
Goodwill 202,133   112,097 
Intangible assets, net 30,278   22,892 
Other assets 6,174   4,665 
Total assets$1,302,086  $1,218,860 
Liabilities and Stockholders’ Deficit   
Current liabilities   
Accounts payable$13,346  $5,204 
Accrued expenses and other current liabilities 111,029   97,921 
Deferred revenue 414,229   380,843 
Finance lease obligations 555   532 
Total current liabilities 539,159   484,500 
Convertible senior notes, non-current 764,281   762,455 
Deferred revenue, non-current 27,527   36,177 
Other long-term liabilities 236   178 
Operating lease liabilities, non-current 8,062   10,890 
Finance lease obligations, non-current 13,631   14,050 
Total liabilities 1,352,896   1,308,250 
Stockholders’ deficit   
Common stock 56   54 
Additional paid-in-capital 645,083   562,942 
Accumulated deficit (698,868)  (652,641)
Accumulated other comprehensive income 2,919   255 
Total stockholders’ deficit (50,810)  (89,390)
Total liabilities and stockholders’ deficit$1,302,086  $1,218,860 
WORKIVA INC. 

CONSOLIDATED STATEMENTS OF CASH FLOWS 
(in thousands)
 Three months ended September 30, Nine months ended September 30,
  2024   2023   2024   2023 
 (unaudited)
Cash flows from operating activities       
Net loss$(16,992) $(56,269) $(46,227) $(123,329)
Adjustments to reconcile net loss to net cash provided by operating activities       
Depreciation and amortization 3,006   2,686   8,092   8,353 
Stock-based compensation expense 27,470   19,377   75,879   78,029 
Provision for (recovery of) doubtful accounts 57   8   (46)  57 
Accretion of premiums and discounts on marketable securities, net (2,638)  (1,930)  (9,543)  (4,530)
Amortization of debt discount and issuance costs 609   472   1,826   1,122 
Induced conversion expense —   45,144   —   45,144 
Realized loss on sale of available-for-sale securities, net —   —   —   708 
Deferred income tax (1)  (14)  (292)  (17)
Changes in assets and liabilities:       
Accounts receivable (15,187)  (15,234)  (11,507)  7,243 
Deferred costs (4,946)  3,116   (15,140)  6,248 
Operating lease right-of-use asset 1,210   1,244   3,808   3,807 
Other receivables (1,745)  (1,556)  2,796   (1,842)
Prepaid expenses and other 344   3,452   2,764   (3,985)
Other assets 464   1,043   (1,191)  1,479 
Accounts payable 4,788   (386)  7,630   (1,267)
Deferred revenue 26,606   11,120   22,159   22,225 
Operating lease liability (878)  (750)  (2,831)  (3,129)
Accrued expenses and other liabilities (3,261)  3,468   5,559   10,217 
Net cash provided by operating activities 18,906   14,991   43,736   46,533 
Cash flows from investing activities       
Purchase of property and equipment (243)  (895)  (554)  (1,732)
Purchase of marketable securities (158,522)  (144,989)  (310,075)  (322,008)
Maturities of marketable securities 108,993   36,906   345,733   76,811 
Sale of marketable securities —   —   4,609   65,052 
Acquisitions, net of cash acquired 187   —   (98,093)  — 
Purchase of intangible assets (44)  (48)  (116)  (167)
Net cash used in investing activities (49,629)  (109,026)  (58,496)  (182,044)
        
Cash flows from financing activities       
Proceeds from option exercises 3,273   1,120   3,865   3,324 
Taxes paid related to net share settlements of stock-based compensation awards (1,173)  (984)  (11,424)  (9,424)
Proceeds from shares issued in connection with employee stock purchase plan 6,709   6,967   13,822   12,513 
Proceeds from the issuance of convertible senior notes, net of issuance costs —   691,113   —   691,113 
Payments for repurchase of convertible senior notes —   (396,869)  —   (396,869)
Principal payments on finance lease obligations (134)  (127)  (395)  (376)
Net cash provided by financing activities 8,675   301,220   5,868   300,281 
Effect of foreign exchange rates on cash 2,390   (1,239)  925   (82)
Net (decrease) increase in cash, cash equivalents, and restricted cash (19,658)  205,946   (7,967)  164,688 
Cash, cash equivalents, and restricted cash at beginning of period 268,412   198,939   256,721   240,197 
Cash, cash equivalents, and restricted cash at end of period$248,754  $404,885  $248,754  $404,885 
 Three months ended September 30, Nine months ended September 30,
 2024 2023 2024 2023
Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets       
Cash and cash equivalents at end of period$248,239 $404,885 $248,239 $404,885
Restricted cash included within prepaid expenses and other at end of period 515  —  515  —
Total cash, cash equivalents, and restricted cash at end of period shown in the consolidated statements of cash flows$248,754 $404,885 $248,754 $404,885
TABLE I 
WORKIVA INC. 
RECONCILIATION OF NON-GAAP INFORMATION 
(in thousands, except share and per share)
 Three months ended September 30, Nine months ended September 30,
  2024   2023   2024   2023 
Gross profit, subscription and support$140,414  $118,557  $400,256  $335,777 
Add back: Stock-based compensation 2,164   1,247   5,708   3,732 
Add back: Amortization of acquisition-related intangibles$1,007  $—  $1,007  $— 
Gross profit, subscription and support, non-GAAP$143,585  $119,804  $406,971  $339,509 
        
Gross profit, professional services$1,536  $1,263  $12,169  $11,232 
Add back: Stock-based compensation 858   623   2,348   1,923 
Gross profit, professional services, non-GAAP$2,394  $1,886  $14,517  $13,155 
        
Gross profit$141,950  $119,820  $412,425  $347,009 
Add back: Stock-based compensation 3,022   1,870   8,056   5,655 
Add back: Amortization of acquisition-related intangibles$1,007  $—  $1,007  $— 
Gross profit, non-GAAP$145,979  $121,690  $421,488  $352,664 
        
Cost of revenue, subscription and support$30,621  $24,864  $86,493  $74,080 
Less: Stock-based compensation 2,164   1,247   5,708   3,732 
Less: Amortization of acquisition-related intangibles$1,007  $—  $1,007  $— 
Cost of revenue, subscription and support, non-GAAP$27,450  $23,617  $79,778  $70,348 
        
Cost of revenue, professional services$13,050  $13,491  $39,873  $42,297 
Less: Stock-based compensation 858   623   2,348   1,923 
Cost of revenue, professional services, non-GAAP$12,192  $12,868  $37,525  $40,374 
        
Research and development$48,425  $41,747  $142,328  $130,235 
Less: Stock-based compensation 5,681   4,155   15,474   13,677 
Less: Amortization of acquisition-related intangibles 414   891   2,267   2,668 
Research and development, non-GAAP$42,330  $36,701  $124,587  $113,890 
        
Sales and marketing$89,756  $72,576  $257,086  $215,168 
Less: Stock-based compensation 9,942   7,108   26,470   20,769 
Less: Amortization of acquisition-related intangibles 467   598   1,292   1,805 
Sales and marketing, non-GAAP$79,347  $64,870  $229,324  $192,594 
        
General and administrative$25,551  $21,022  $76,225  $86,660 
Less: Stock-based compensation 8,825   6,244   25,879   37,928 
General and administrative, non-GAAP$16,726  $14,778  $50,346  $48,732 
        
Loss from operations$(21,782) $(15,525) $(63,214) $(85,054)
Add back: Stock-based compensation 27,470   19,377   75,879   78,029 
Add back: Amortization of acquisition-related intangibles 1,889   1,489   4,566   4,473 
Income (loss) from operations, non-GAAP$7,577  $5,341  $17,231  $(2,552)
        
Net loss$(16,992) $(56,269) $(46,227) $(123,329)
Add back: Stock-based compensation 27,470   19,377   75,879   78,029 
Add back: Amortization of acquisition-related intangibles 1,889   1,489   4,566   4,473 
Net income (loss), non-GAAP$12,367  $(35,403) $34,218  $(40,827)
        
Net loss per basic and diluted share:$(0.31) $(1.04) $(0.84) $(2.28)
Add back: Stock-based compensation 0.50   0.36   1.38   1.44 
Add back: Amortization of acquisition-related intangibles 0.03   0.03   0.08   0.08 
Net income (loss) per basic share, non-GAAP$0.22  $(0.65) $0.62  $(0.76)
Net income (loss) per diluted share, non-GAAP$0.21  $(0.65) $0.60  $(0.76)
        
Weighted-average common shares outstanding - basic, non-GAAP 55,581,841   54,256,941   55,226,254   53,987,791 
Weighted-average common shares outstanding - diluted, non-GAAP 57,557,373   54,256,941   57,361,707   53,987,791 
TABLE II 
WORKIVA INC. 
RECONCILIATION OF NON-GAAP GUIDANCE 
(in thousands, except share and per share data)
 Three months ending 
December 31, 2024		 Year ending December 31, 2024
        
Loss from operations, GAAP range$(16,186)-$(14,186) $(79,400)-$(77,400)
Add back: Stock-based compensation 27,121   27,121   103,000   103,000 
Add back: Amortization of acquisition-related intangibles 1,834   1,834   6,400   6,400 
Income from operations, non-GAAP range$12,769 -$14,769  $30,000 -$32,000 
        
Net loss per share, GAAP range$(0.21)-$(0.18) $(1.05)-$(1.02)
Add back: Stock-based compensation 0.49   0.49   1.86   1.86 
Add back: Amortization of acquisition-related intangibles 0.03   0.03   0.12   0.12 
Net income per share, non-GAAP range$0.31 -$0.34  $0.93 -$0.96 
        
Weighted-average common shares outstanding - basic 55,800,000   55,800,000   55,400,000   55,400,000 

 

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Investor Contact: 
Mike Rost 
Workiva Inc. 
investor@workiva.com

Media Contact: 
Mandi McReynolds 
Workiva Inc. 
press@workiva.com

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