WK Workiva Inc

• Increased Q1 2024 Subscription & Support Revenue by 20% over Q1 2023
• Total revenues of $176 million in Q1 2024, representing 17% year-over-year growth
• Achieved 34% YOY Growth of Customers with Annual Contract Value Over $300K

Workiva Inc. (NYSE:WK), the world’s leading cloud platform for assured integrated reporting, today announced financial results for its first quarter ended March 31, 2024.

"The Workiva team delivered another solid quarter, resulting in subscription revenue growth of 20%," said Julie Iskow, President & Chief Executive Officer. "Workiva's platform remains a key differentiator for new logo wins and account expansion deals. Workiva is the only platform that brings Financial Reporting, ESG and GRC together in one secure, controlled, audit-ready environment. We are the platform for assured integrated reporting."

"In Q1, we generated 66% of subscription revenue from customers who have multiple solutions," said Jill Klindt, Chief Financial Officer. "Our focus on multi-solution deals and account expansions led to the increase in the number of larger subscription contracts. Workiva had 332 customers with an annual contract value over $300,000 at the end of the first quarter, growing 34% compared to the same time last year."

First Quarter 2024 Financial Results

• Revenue: Total revenue for the first quarter of 2024 reached $176 million, an increase of 17% from $150 million in the first quarter of 2023. Subscription and support revenue contributed $155 million, up 20% versus the first quarter of 2023. Professional services revenue was $21 million, relatively flat compared to the same quarter in the prior year.
• Gross Profit: GAAP gross profit for the first quarter of 2024 was $134 million compared with $112 million in the same quarter of 2023. GAAP gross margin was 76.4% versus 74.3% in the first quarter of 2023. Non-GAAP gross profit for the first quarter of 2024 was $136 million, an increase of 20% compared with the prior year's first quarter, and non-GAAP gross margin was 77.7% compared to 75.5% in the first quarter of 2023.
• Results from Operations: GAAP loss from operations for the first quarter of 2024 was $18 million compared with a loss of $47 million in the prior year's first quarter. Non-GAAP income from operations was $6 million compared with a non-GAAP loss from operations of $7 million in the first quarter of 2023.
• GAAP Net Loss: GAAP net loss for the first quarter of 2024 was $12 million compared with a net loss of $46 million for the prior year's first quarter. GAAP net loss per basic and diluted share was $0.21 compared with a net loss per basic and diluted share of $0.86 in the first quarter of 2023.
• Non-GAAP Net Income/Loss: Non-GAAP net income for the first quarter of 2024 was $13 million compared with a loss of $7 million in the prior year's first quarter. Non-GAAP net income per basic share and diluted share was $0.23 and $0.22, respectively, compared with a net loss per basic and diluted share of $0.12 in the first quarter of 2023.
• Liquidity: As of March 31, 2024, Workiva had cash, cash equivalents, and marketable securities totaling $838 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 March 31, 2024.

Key Metrics and Recent Business Highlights

• Customers: Workiva had 6,074 customers as of March 31, 2024, a net increase of 320 customers from March 31, 2023.
• Revenue Retention Rate: As of March 31, 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 March 31, 2024, Workiva had 1,696 customers with an annual contract value (“ACV”) of more than $100,000, up 24% from 1,363 customers at March 31, 2023. Workiva had 961 customers with an ACV of more than $150,000, up 29% from 746 customers in the first quarter of 2023. Workiva had 332 customers with an ACV of more than $300,000, up 34% from 247 customers in the first quarter of 2023.

Financial Outlook

As of May 2, 2024, Workiva is providing guidance as follows:

Second Quarter 2024 Guidance:

• Total revenue is expected to be in the range of $174 million to $176 million.
• GAAP loss from operations is expected to be in the range of $24.0 million to $22.0 million.
• Non-GAAP income from operations is expected to be in the range of $2 million to $4 million.
• GAAP net loss per basic share is expected to be in the range of $0.32 to $0.29.
• Non-GAAP net income per basic share is expected to be in the range of $0.16 to $0.19.
• Net income (loss) per basic share is based on 55.2 million weighted-average shares outstanding.

Full Year 2024 Guidance:

• Total revenue is expected to be in the range of $719 million to $723 million.
• GAAP loss from operations is expected to be in the range of $76 million to $72 million.
• Non-GAAP income from operations is expected to be in the range of $27 million to $31 million.
• GAAP net loss per basic share is expected to be in the range of $0.90 to $0.83.
• Non-GAAP net income per basic share is expected to be in the range of $0.96 to $1.03.
• Net income (loss) per basic share is based on 55.3 million weighted-average shares outstanding.

Quarterly Conference Call

Workiva will host a conference call today at 5:00 p.m. ET to review the Company’s financial results for the first quarter 2024, in addition to discussing the Company’s outlook for the second quarter and full year 2024. To access this call, dial 888-330-2469 (U.S. domestic) or 240-789-2740 (international). The conference ID is 8736384. A live webcast of the conference call will be accessible in the "Investor Relations" section of Workiva’s website at www.workiva.com. A replay of this conference call can also be accessed through May 9, 2024, at 800-770-2030 (U.S. domestic) or 647-362-9199 (international). The replay pass code is 8736384. An archived webcast of this conference call 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, Environmental, Social, and Governance (ESG), and Governance, Risk, and Compliance (GRC) 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.

Safe Harbor Statement

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 March 31,

 

 

2024

 

 

 

2023

 

 

(unaudited)

Revenue

 

 

 

Subscription and support

$

154,979

 

 

$

129,664

 

Professional services

 

20,688

 

 

 

20,525

 

Total revenue

 

175,667

 

 

 

150,189

 

Cost of revenue

 

 

 

Subscription and support (1)

 

27,927

 

 

 

24,133

 

Professional services (1)

 

13,596

 

 

 

14,385

 

Total cost of revenue

 

41,523

 

 

 

38,518

 

Gross profit

 

134,144

 

 

 

111,671

 

Operating expenses

 

 

 

Research and development (1)

 

45,495

 

 

 

45,791

 

Sales and marketing (1)

 

82,633

 

 

 

70,710

 

General and administrative (1)

 

24,299

 

 

 

42,011

 

Total operating expenses

 

152,427

 

 

 

158,512

 

Loss from operations

 

(18,283

)

 

 

(46,841

)

Interest income

 

10,455

 

 

 

3,717

 

Interest expense

 

(3,232

)

 

 

(1,501

)

Other income and (expense), net

 

86

 

 

 

(940

)

Loss before provision for income taxes

 

(10,974

)

 

 

(45,565

)

Provision for income taxes

 

713

 

 

 

585

 

Net loss

$

(11,687

)

 

$

(46,150

)

Net loss per common share:

 

 

 

Basic and diluted

$

(0.21

)

 

$

(0.86

)

Weighted-average common shares outstanding - basic and diluted

 

54,915,852

 

 

 

53,690,242

 

(1) Includes stock-based compensation expense as follows:

 

Three months ended March 31,

 

2024

 

2023

 

(unaudited)

Cost of revenue

 

 

 

Subscription and support

$

1,601

 

$

1,072

Professional services

 

727

 

 

633

Operating expenses

 

 

 

Research and development

 

4,641

 

 

4,697

Sales and marketing

 

8,038

 

 

6,958

General and administrative

 

8,000

 

 

24,682

WORKIVA INC.

 

CONSOLIDATED BALANCE SHEETS

(in thousands)

 

March 31, 2024

 

December 31, 2023

 

(unaudited)

 

 

Assets

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

296,066

 

 

$

256,100

 

Marketable securities

 

542,281

 

 

 

557,622

 

Accounts receivable, net

 

87,898

 

 

 

125,193

 

Deferred costs

 

37,822

 

 

 

39,023

 

Other receivables

 

7,162

 

 

 

7,367

 

Prepaid expenses and other

 

25,771

 

 

 

23,631

 

Total current assets

 

997,000

 

 

 

1,008,936

 

Property and equipment, net

 

23,295

 

 

 

24,282

 

Operating lease right-of-use assets

 

11,254

 

 

 

12,642

 

Deferred costs, non-current

 

32,848

 

 

 

33,346

 

Goodwill

 

110,317

 

 

 

112,097

 

Intangible assets, net

 

21,154

 

 

 

22,892

 

Other assets

 

6,036

 

 

 

4,665

 

Total assets

$

1,201,904

 

 

$

1,218,860

 

Liabilities and Stockholders’ Deficit

 

 

 

Current liabilities

 

 

 

Accounts payable

$

9,911

 

 

$

5,204

 

Accrued expenses and other current liabilities

 

89,437

 

 

 

97,921

 

Deferred revenue

 

367,060

 

 

 

380,843

 

Finance lease obligations

 

540

 

 

 

532

 

Total current liabilities

 

466,948

 

 

 

484,500

 

Convertible senior notes, non-current

 

763,063

 

 

 

762,455

 

Deferred revenue, non-current

 

31,085

 

 

 

36,177

 

Other long-term liabilities

 

212

 

 

 

178

 

Operating lease liabilities, non-current

 

9,839

 

 

 

10,890

 

Finance lease obligations, non-current

 

13,913

 

 

 

14,050

 

Total liabilities

 

1,285,060

 

 

 

1,308,250

 

Stockholders’ deficit

 

 

 

Common stock

 

55

 

 

 

54

 

Additional paid-in-capital

 

584,752

 

 

 

562,942

 

Accumulated deficit

 

(664,328

)

 

 

(652,641

)

Accumulated other comprehensive (loss) income

 

(3,635

)

 

 

255

 

Total stockholders’ deficit

 

(83,156

)

 

 

(89,390

)

Total liabilities and stockholders’ deficit

$

1,201,904

 

 

$

1,218,860

 

WORKIVA INC.

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

 

Three months ended March 31,

 

 

2024

 

 

 

2023

 

 

(unaudited)

Cash flows from operating activities

 

 

 

Net loss

$

(11,687

)

 

$

(46,150

)

Adjustments to reconcile net loss to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

2,522

 

 

 

2,800

 

Stock-based compensation expense

 

23,007

 

 

 

38,042

 

(Recovery of) provision for doubtful accounts

 

(123

)

 

 

106

 

Realized loss on sale of available-for-sale securities, net

 

—

 

 

 

561

 

Amortization of premiums and discounts on marketable securities, net

 

(3,749

)

 

 

(1,028

)

Amortization of issuance costs and debt discount

 

608

 

 

 

325

 

Deferred income tax

 

(295

)

 

 

(10

)

Changes in assets and liabilities:

 

 

 

Accounts receivable

 

36,947

 

 

 

29,363

 

Deferred costs

 

1,405

 

 

 

1,770

 

Operating lease right-of-use asset

 

1,426

 

 

 

1,295

 

Other receivables

 

194

 

 

 

95

 

Prepaid expenses

 

(2,273

)

 

 

(5,732

)

Other assets

 

(1,090

)

 

 

(74

)

Accounts payable

 

4,726

 

 

 

207

 

Deferred revenue

 

(17,526

)

 

 

(9,955

)

Operating lease liability

 

(987

)

 

 

(1,172

)

Accrued expenses and other liabilities

 

(8,261

)

 

 

(4,880

)

Net cash provided by operating activities

 

24,844

 

 

 

5,563

 

Cash flows from investing activities

 

 

 

Purchase of property and equipment

 

(203

)

 

 

(198

)

Purchase of marketable securities

 

(116,567

)

 

 

(125,815

)

Sale of marketable securities

 

4,609

 

 

 

43,713

 

Maturities of marketable securities

 

129,640

 

 

 

31,905

 

Purchase of intangible assets

 

(31

)

 

 

(79

)

Net cash provided by (used in) investing activities

 

17,448

 

 

 

(50,474

)

 

 

 

 

Cash flows from financing activities

 

 

 

Proceeds from option exercises

 

302

 

 

 

1,457

 

Taxes paid related to net share settlements of stock-based compensation awards

 

(8,611

)

 

 

(7,228

)

Proceeds from shares issued in connection with employee stock purchase plan

 

7,113

 

 

 

5,546

 

Principal payments on finance lease obligations

 

(129

)

 

 

(124

)

Net cash used in financing activities

 

(1,325

)

 

 

(349

)

Effect of foreign exchange rates on cash

 

(1,107

)

 

 

548

 

Net increase (decrease) in cash and cash equivalents

 

39,860

 

 

 

(44,712

)

Cash and cash equivalents at beginning of period

 

256,721

 

 

 

240,197

 

Cash and cash equivalents at end of period

$

296,581

 

 

$

195,485

 

 

Three months ended March 31,

 

2024

 

2023

Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets

 

 

 

Cash and cash equivalents at end of period

$

296,066

 

$

195,485

Restricted cash included within prepaid expenses and other at end of period

 

515

 

 

—

Total cash, cash equivalents, and restricted cash at end of period shown in the consolidated statements of cash flows

$

296,581

 

$

195,485

TABLE I

WORKIVA INC.

RECONCILIATION OF NON-GAAP INFORMATION

(in thousands, except share and per share)

 

Three months ended March 31,

 

 

2024

 

 

 

2023

 

Gross profit, subscription and support

$

127,052

 

 

$

105,531

 

Add back: Stock-based compensation

 

1,601

 

 

 

1,072

 

Gross profit, subscription and support, non-GAAP

$

128,653

 

 

$

106,603

 

 

 

 

 

Gross profit, professional services

$

7,092

 

 

$

6,140

 

Add back: Stock-based compensation

 

727

 

 

 

633

 

Gross profit, professional services, non-GAAP

$

7,819

 

 

$

6,773

 

 

 

 

 

Gross profit

$

134,144

 

 

$

111,671

 

Add back: Stock-based compensation

 

2,328

 

 

 

1,705

 

Gross profit, non-GAAP

$

136,472

 

 

$

113,376

 

 

 

 

 

Cost of revenue, subscription and support

$

27,927

 

 

$

24,133

 

Less: Stock-based compensation

 

1,601

 

 

 

1,072

 

Cost of revenue, subscription and support, non-GAAP

$

26,326

 

 

$

23,061

 

 

 

 

 

Cost of revenue, professional services

$

13,596

 

 

$

14,385

 

Less: Stock-based compensation

 

727

 

 

 

633

 

Cost of revenue, professional services, non-GAAP

$

12,869

 

 

$

13,752

 

 

 

 

 

Research and development

$

45,495

 

 

$

45,791

 

Less: Stock-based compensation

 

4,641

 

 

 

4,697

 

Less: Amortization of acquisition-related intangibles

 

890

 

 

 

886

 

Research and development, non-GAAP

$

39,964

 

 

$

40,208

 

 

 

 

 

Sales and marketing

$

82,633

 

 

$

70,710

 

Less: Stock-based compensation

 

8,038

 

 

 

6,958

 

Less: Amortization of acquisition-related intangibles

 

412

 

 

 

601

 

Sales and marketing, non-GAAP

$

74,183

 

 

$

63,151

 

 

 

 

 

General and administrative

$

24,299

 

 

$

42,011

 

Less: Stock-based compensation

 

8,000

 

 

 

24,682

 

General and administrative, non-GAAP

$

16,299

 

 

$

17,329

 

 

 

 

 

Loss from operations

$

(18,283

)

 

$

(46,841

)

Add back: Stock-based compensation

 

23,007

 

 

 

38,042

 

Add back: Amortization of acquisition-related intangibles

 

1,302

 

 

 

1,487

 

Income (loss) from operations, non-GAAP

$

6,026

 

 

$

(7,312

)

 

 

 

 

Net loss

$

(11,687

)

 

$

(46,150

)

Add back: Stock-based compensation

 

23,007

 

 

 

38,042

 

Add back: Amortization of acquisition-related intangibles

 

1,302

 

 

 

1,487

 

Net income (loss), non-GAAP

$

12,622

 

 

$

(6,621

)

 

 

 

 

Net loss per basic and diluted share:

$

(0.21

)

 

$

(0.86

)

Add back: Stock-based compensation

 

0.42

 

 

 

0.71

 

Add back: Amortization of acquisition-related intangibles

 

0.02

 

 

 

0.03

 

Net income (loss) per basic share, non-GAAP

$

0.23

 

 

$

(0.12

)

Net income (loss) per diluted share, non-GAAP

$

0.22

 

 

$

(0.12

)

 

 

 

 

Weighted-average common shares outstanding - basic, non-GAAP

 

54,915,852

 

 

 

53,690,242

 

Weighted-average common shares outstanding - diluted, non-GAAP

 

56,352,572

 

 

 

53,690,242

 

TABLE II

WORKIVA INC.

RECONCILIATION OF NON-GAAP GUIDANCE

(in thousands, except share and per share data)

 

Three months ending June 30, 2024

 

Year ending December 31, 2024

 

 

 

 

 

 

 

 

Loss from operations, GAAP range

$

(24,000

)

-

$

(22,000

)

 

$

(76,000

)

-

$

(72,000

)

Add back: Stock-based compensation

 

24,700

 

 

 

24,700

 

 

 

98,000

 

 

 

98,000

 

Add back: Amortization of acquisition-related intangibles

 

1,300

 

 

 

1,300

 

 

 

5,000

 

 

 

5,000

 

Income from operations, non-GAAP range

$

2,000

 

-

$

4,000

 

 

$

27,000

 

-

$

31,000

 

 

 

 

 

 

 

 

 

Net loss per share, GAAP range

$

(0.32

)

-

$

(0.29

)

 

$

(0.90

)

-

$

(0.83

)

Add back: Stock-based compensation

 

0.46

 

 

 

0.46

 

 

 

1.77

 

 

 

1.77

 

Add back: Amortization of acquisition-related intangibles

 

0.02

 

 

 

0.02

 

 

 

0.09

 

 

 

0.09

 

Net income per share, non-GAAP range

$

0.16

 

-

$

0.19

 

 

$

0.96

 

-

$

1.03

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding - basic

 

55,200,000

 

 

 

55,200,000

 

 

 

55,300,000

 

 

 

55,300,000

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240502478727/en/

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

Media Contact: Rotha Brauntz Workiva Inc. press@workiva.com