WDAY - Earnings call transcript Q3 2019

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Operator

Welcome to Workday's Third Quarter Fiscal Year 2019 Earnings Call. At this time, all participants are in listen-only mode.

We will conduct a question-and-answer session towards the end of the call. And with that, I will hand it over to Mr. Mike Magaro, Vice President of Investor Relations. ahead. go Please

Michael Magaro

third Workday's XXXX conference earnings Welcome quarter call. to fiscal

Tom we On Chano our and; Insights. have CEO; call, Fernandez, CEO, Robynne Co-President CFO; Bhusri, and Aneel the Adaptive Co-President Sisco, our Bogan, our

Aneel Following take Robynne's we prepared will and questions. remarks,

issued made was to close release the other forth recent include uncertainties in our results risks, statements that may Exchange the on on Commission, this Please set for report release risk is is being to financial of refer and this file and assumptions regarding customer and website, call matters. differ where press are most our XX-Q press risks, call and quarterly factors demand, results, we and on actual simultaneously posted documents subject after and Our uncertainties those including Securities market such our statements webcast. cause operations applications, on Statements the These forward-looking from to the materially with statements. Form and assumptions. information

discuss as in measures results. considered today's we as useful In addition, These are believe for, substitute and we supplemental GAAP which measures non-GAAP Workday's to, not addition measures call, should financial in non-GAAP isolation performance. be from a or of during will

is page Investor list our the a next updated link. Relations website You for Investor results page reconciliations available regarding on and call of in webcast can find customers company selected website. under be of days of and these GAAP this the additional customers our monthly. of Relations including will our website with Also, the our XX release comparable disclosures non-GAAP measures on earnings the includes replay press The

period it stated, comparisons our hand on fiscal quiet And comparable Unless XXXX. that, this will our with over XXXX. the results all quarter to period call January me XX, fourth to be let Our of financial for in begins otherwise Aneel.

Aneel Bhusri

pleased to our for new in third our net report XXXX, Mike. quarter I'm ACV earnings and that year thank acceleration of QX afternoon, call. everyone, Thank an you fiscal in growth. Good joining you, experienced we

Management Our a of business had we applications. quarter Human our and Management Capital for remained suite Financial strong great

user Importantly, place HCM, another impact as gain acquisition. had took strong of platform, Glencore unparalleled Insights enjoyed the Bank experience true levels American of we International, we subsidiary and market customers acceleration the QX, leading a Airlines. highest include customer of the success. of independent Adaptive share the with deepest capabilities, the Montreal, we new continue and Airlines, of with quarter product the Starting some the In HCM business cloud an in added an industry we to of Piedmont

the been continue revenue demonstrate financials has proven collectively saw the in office Management part accelerated Management ability our growth marquee increasing once to the Financial net believe our our broader by for We again competitors offerings, set grew data combination accounts neither Subscription financial and driving ever-increasing of customers' transactions, of applications. in In production growing of CFO, adoption are that of core over expanded acceptance ACV the XX% over new Financial with customers of a and cohort of of our XX%. of cloud that applications. the we in volumes our for our suite to legacy land due cloud. the large of to capability support Workday to a consistently QX, We able also

New large R & Health, Braves a baseball, Workday included and services Block, organization. H the Spectrum Management Atlanta customers based Fox, financial QX Financial U.S. in

enterprise to the report Insights planning of we core success together, got application, large our pleased suite on financial early cloud And feedback to with adoption great strong of pace with plan I'm are for Adaptive of was start to Workday Workday. and first growth high from our a early Adaptive selling and QX cloud Insights to and accelerating as Adaptive. the quarter with off Adaptive interest actively our prospects In addition product part of offerings. very to been the [indiscernible]. enthusiasm the positive the with from Adaptive committed we Indeed, unifying many We're offerings Insights alike Adaptive customers planning business working has customers customers. migrating Workday of to on

to QX, While strong which of one we to our for model, XX of one we ERP Adaptive in security will that Workday data, one our to one with business. will on experience support enables benefit And also Power analyze user community to of all platform. in and delivery continue experienced integrations growth our track the one One are and month course to on them systems, we of lastly execute segment customers with XX plan, access source media

many of year know, enterprises. launch for Workday you we application introduced the fee As program announced fixed last U.S. which packages medium based preconfigured

our offer strong already platform full in HR, growth our and to costs ability of market. implementation Our lowered the and that position a competitive solution finance across payroll segment enhanced accelerated have with

With we to fiscal the the XXXX overseas target U.S. of launch success in U.S. year now that enterprise to medium planning the program in take Workday outside are businesses

in once XX%. success captured satisfaction Our approximately XX,XXX and attendees our X,XXX at our in and representing two ago, Rising, At Las attendees conference in our welcomed Vegas at customer which was U.S. revealed annual almost the user rating weeks in we including Workday more came Europe. our momentum annual in Between Rising X,XXX again Vienna U.S. European customer organizations. last we best conferences, customer in Workday conference month

hopefully Workday their decisions better run hard you core to customers effectively As day Workday by now, our help more and customer the way. the make works business success a along is every know value of team and

and our machine application front, fabric most continue leveraging With push critical HR the an to and machine their workforce accompanied provide the the systems, augmented product executives, powerful that understanding platform. we Workday explanatory technologies view on to acquisition and AI HR learning created business with in give offer will most the leverage People Analytics, new trends a leaders trends. recent Workday data, analytics It technology narratives, we're On stories. of innovation those drivers and of storage call and by organizational metrics we artificial the partners of the likely what Workday most as and into a analytic, of dynamically focus finance intelligence, embedding will learning to

Our customers continue our cycle. innovation continuous to benefit from

number of for make best to the On that industry During built, our skills we our relate announced Women. announced our we our customers and Workday is the We a launch skills that and core we've investment and most the And company always that we organizations the quarter, Great Happy data. are the cloud, understand, to customers the innovation recognizes the the products number the one Workday been share Work [indiscernible]. XXX future. in day employees availability among XX ranked quarter, one will month always which pleased investing innovative product job of were that believe included foster, happy. build university also continue I'm new innovation cleanse, had on this XX skills From Best in features the Fortune's helps people value. our note, culture takes forward-looking From In number will be and eyes future. on companies that it and in world's our pay what one and into Future Workplaces employees list we to list off. Places three many Fortune has on which our to

to Workday in systems. and and plan and continue the end. growth we to and market Workday cloud analytics, Management expect strong quarter momentum future near Financial customer looking into drivers primary As growth an All in share Management with the QX analysis and to we leadership year great through for planning [indiscernible] all, are term to set innovation, are Financial CFOs drivers leader Robynne. HCM gain cloud we with their established a will and firmly Adaptive continue Both differentiate business to offerings Insights, look heading in you, And the future, a our And HCM the foundation strong ourselves are globally. modernize strong of be over and we the for with cloud. the in now where to of and who financial scalability early

Robynne Sisco

and good everyone. Thanks, Aneel, afternoon,

delivered resulting a metric and growth end. on us heading highlights the our giving great into our business guidance I'll update level momentum preliminary FY accelerated discussed, from in core As year view we quarter, across and third QX Aneel in provide our performance touch QX, On of strong XXXX. today's call, for high

level Insights, or however are it of tracking guide we first this sense Insights additional to an expect call product we will transparency Insights providing milestone so your results key is Adaptive metrics. separately give across not with understanding assist Given as from report our forward. during QX metrics we of not makes do impacted key to our in other how this Instead, with Adaptive quarter Internally, going are you all Adaptive as updates us planning should and when so. products, you any our to differently

For $XXX of million, growth reflecting XX%. revenue QX, year-over-year we total delivered of

the representing Subscription $XXX remaining $X deals bookings subscription performance Approximately of this related in net deferred Adaptive was remaining an growth new was The or up suite. backlog again of total U.S. retention inclusion $X.X net Adaptive a relates acquisition. across backlog QX upside million, revenue the XX% Our is to The revenue finalization XXX%. XX% that strong to to acceleration outside product Revenue from and up balance. growth Insights pulled the very attributable was year-over-year. QX revenue. percentage Insights of was renewals haircut increase $XXX of with the million driven very few million, $XXX over the points the revenue of million XX% by driven was strong billion, by Approximately year-over-year. over-performance of including the our of X of growth, to once growth XX%

inclusion of Adaptive million subscription $XXX was growth relates XX%. to billion X or Our Approximately XX-month growth the backlog of of Insights. points $X.XX or

operating the million primarily non-GAAP strong revenue the was quarter $XX.X and profit was a for of performance. guidance result The our margin margin Our X.X%. operating from of upside third

flow million. Third quarter cash from was $XXX operations

up the our at $X.XX XX% cash is in QX flow guidance this by majority end with billion, impacted we the As the noted $X.XX was of occurring a grew unearned year-over-year. of acquisition QX. year-over-year unearned in of Current one-time quarter, year Total to payments half XX% revenue billion. in second revenue related impact last

biggest Workday. Our people be to to our in and attracting top in continues investment talent

employees, from we Adaptive to over workforce quarter total added X,XXX XXX During QX, over of the end the over our and at bringing net integrated successfully new Insights, including XX,XXX.

very well going pleased our into quarter. and positioned our execution operational in with historically are strongest feel QX We

is follows. XXXX as Now raise let's QX our in outlook The strength fiscal us allowing to business to continued guidance. our turn and

XX%. our raising year of we're $X.XXX billion estimate $X.XXX be of to revenue, range or subscription billion the For full in to growth

to million revenue subscription QX be $XXX our $XXX expect to XX% million XX% growth. We to or

to revenue XXXX revenue total fiscal We be million be expect $XXX QX. growth $XXX We $XXX professional billion, growth with for to million million that will XX%. services XX%, million, $X.XXX to therefore the fiscal billion approximately $XXX $X.XXX in QX of in XXXX total in range estimate or of revenue or of and

expecting than approximately the non-GAAP approximately both operating and non-GAAP full for in fiscal and GAAP are XX% points to margins of are margins The by QX percentage operating lower We year. XX expected both margins QX XXXX. the be

XX% the in we in unearned short-term approximately revenue grow strength business, QX. now to Given forecast

and $XXX full guidance be linearity believe that number We some timing flow but of to there our million cash upside on operating of depending year, collections. the QX are for may maintaining

in expenditure performance capital around what call our longer fiscal color our maintaining until CapEx. $XXX this million bridge owned subscription the a projects backlog. our other to short-term of growth we reporting for rates. and obligations, will also another Please no XXXX for are estate revenue unearned we the providing around for that year all next million We $XXX remaining guidance new peers be real year transition revenue We note requirements as did

the unlike billings, new gauge metric it's is health by not and contractual this impacted the because unearned it's long our invoicing better primarily While perfect, terms. we over of a believe revenue not term of varying business

and to XXXX FY towards established a provide and to long-term an cycle sustain to FY would our growth, We strong adoption and like important still in confident we have close, XXXX. remain secular we planning cloud revenue trends market level view While given in are ability leadership position. early QX our the our of high preliminary

XXXX subscription planning approximately billion. billion FY We are $X.X for revenue $X.XX currently to of

with revenue QX. We sequentially our and continue seasonally to approximately from pronounced QX new expect of slowest terms towards X% the net seasonality FY compounding bookings. in would of XXXX We being expect QX QX grow to in subscription

made have and margin We growth continue to expansion year will and continue to investments product beyond. over significant other prioritize and and make next

Adaptive levels operating XXXX acquisition, margin return margin headwinds more some normal expansion. the still from to do we While to faces expect FY of

which which improvement XXXX We close FY that, an thanking operating customers, are represents planning and year-over-year. XXX currently for XX%, I'll hard their year. Q&A With a our work results in the estimated and for us of the continued the process. non-GAAP support up Operator, us partners, margins allowed by amazing basis have deliver point and begin employees now to third set to strong finish let's for quarter great

Operator

Instructions] Credit first Suisse. Brad comes question of [Operator Your the from line from Zelnick

Your line is open.

Kevin Ma

acquisition. taking Can Kevin Pro for I the much synergies any services, you incremental reaccelerated that or on other Congrats what on just for and from quarter, Ma give that from substantially Zelnick. how financials any Thank ask of you. out on quarter, Brad uptake guided was color This to on you drivers. guys. originally this pretty Adaptive even is the wanted

Aneel Bhusri

you what normal implementations so growth many so number normal ebb in serve those of is on seasonal growth time, there. at see and going given the are kind of Pro can us. any on levels for priming, that we're just Yeah, really patterns That the number of how flow of based pretty

Kevin Ma

it. Got

Okay. from Thank That's me. it you.

Operator

the line with Your comes JPMorgan. next from Mark question of Murphy

Your is open. line

Aneel Bhusri

you are Mark, there?

Michael Magaro

Next please. question,

Mark Murphy

deals XX,XXX was portion there been Yeah, the on that in towards that financials, in ask the but only both on of platform gets also and real I HR include enterprise not deals field the and that or kind employees. up here. has trying work I'm been showing mid-market the XX,XXX of you it's to a increase our

terms And So just you look do look that take you're is when you tangible trend curious then that pipeline year, a how from what consideration? platform purchases next mix? you in the the see the at the platform seeing if accelerating toward bookings at of for

Aneel Bhusri

need really have enterprise unified probably one not prefer and by up there's the HR the now solution. have no cloud. Well, really to finance buyers, trend years financials system. rather systems. begin different several for to is that a up medium move popular market. two for platform They is to would question the that last seeing solution would market, we're They more moving And to that driven They what move

so Tom, that continue would of anything to to a add? our And business. and I become expect to bigger part

Tom Bogan

percentage continues mix. the that's grow the correct. to From think No, a Mark. I Hi, perspective, financials management a as of

in give the HCM, shift course mix of moving Although solid slowly. growth is sustained

Mark Murphy

just And Chano, Okay. follow-up. if quick I may, a

for I think at Rising you commented that the pipeline was particularly QX. strong

of QX. all? change think I to QX it's the see or confidence the pulled material So kind blowout setup high, enough that results at kind the that QX deals in into Is a to of were little in surprising equally QX

Chano Fernandez

Mark. you, Thank

quarter. going last QX we're the I But outlook. we think it's to be similar business our the execution. pipeline we It's think we question but have about in still pulled some commented levels forward in a from of as coverage early of so quarter of I year, positive

Mark Murphy

you much. very Thank

Operator

Morgan Weiss of question next from Keith line comes Stanley. with the Your

open. is line Your

Sanjit Singh

sitting Hi. I in a Singh questions. really had quarter. on Keith. is This Congrats for Sanjit two strong

seems the of the on HCM First driving on new can in on about you the lot the what's the international, wins or there of would house, opportunity mentioned mid-market, further that's the detail you a there, but base. the to international further momentum. of appreciated. any XX% of color side whether expansion be like sort penetrate it's provide growth strength Any getting Aneel,

Aneel Bhusri

I'll over Chano. to turn that question

Chano Fernandez

Thanks the question. for

foundation that we the in and successful a created, international We customer strong with in Vienna. rise are the momentum hugely we had business, Europe happy the the had visibility

ahead a of in very couple of those is early of we adoption days U.S. international. on believe as terms are work in terms but really Our Asia footprint where opportunity emerging cloud great the of opportunity us is we the of Europe geographies are ahead are establishing time. there a still consistency, us behind in improving focused which still have clearly great expanding. across markets It's and over I

Sanjit Singh

growth. Maybe before, little type leveling for Financial of like mentioned of sort feel growth this XX%-plus seen we've of previous me, performance the and Financial Aneel, to comments appreciate out but call sort were environment of uptick of out. this Chano. that strong Does of I interpreting maybe ahead Financial the revenue as my I Management comments, you inflection, bit Management To Any like it this bit a in I how wonder some felts quarter. been we've of of Management, follow-up, then ACV the you hesitant a when there. different versus know a bit a a and times of an

Aneel Bhusri

I'm any one to not draw from be Well, going careful quarter. to conclusions

growing the very some now for at over strong We subscription business to financials. continues for be The quite revenue time. medium on been the business clip a have XX% enterprise side

that discount I just across the we but is think not continuing once, showing opportunity enterprises. good are is move sometimes that financials U.S. I how rate the globe. picking at cloud amongst people but accounts are Fortune for to all up us, large won't Fortune accounts the up. see to XXX XXX definitely showing And evaluate for the in say the of up

of think things and that customers we're crowd, every fairly I XXX in So pleased. XX% Financials by start after ask I and them one live out the paying very patterns, of think of CFOs but don't can do Workday over want draw any quarter. are using are again at But we I just to conclusions production. nature, now attention who are averse looking a to that quarter one risk and

run and their And to is happy business. their using very customers cohort a now of there books close so system the

you Workday to. cloud, smaller a a could CFOs companies and talk that and in universe much years few ago, peers was the So about can financials of their ask

Sanjit Singh

you very much. Thank

Operator

Justin & the of comes question next line with William from Furby Company. Your Blair

Your line is open.

Justin Furby

Can guys. hear me? you Thanks,

Aneel Bhusri

Yes, we can.

Justin Furby

inside And I particularly Great. or if what see I'm business conversations enterprise, versus competitively, curious sort at – that it's and the if it's – you how how Okay. wanted all guess Aneel things? the of on early but all know changes to the rates of up Workday you follow HR I side in what just feel market dynamic, commentary. pretty have Chano, is the you the changed that that now just financials I look about I in yet. Adaptive, that on were hi. your at changed of guess win do

Aneel Bhusri

rates and our first and the market, is So finance quite HR a NetSuite – an see been on cloud. main are and the competitor Oracle. there is relatively and less the for win really just for are Ultimate have similar one, in only overlap case and time. competitors doesn't product SAP finance finance, we that's some less. HR In in the the

So landscape are it a but pretty is slightly different win our similar. rates competitive

degree customers as ones not out into of but In Workday for quite the switch Adaptive, financials are at a HR and cloud. that planning, already just first the ones looking amongst who to customers, to terms but a maybe financials interest Adaptive ready planning Not high of had moving the core Insights. there's up enterprise signed step

Workday more that. the want So be Tom, Tom you being Adaptive by the historical products anything thrilled are add how couldn't to customer to I received and to base. as

Tom Bogan

I that's Yeah, right, think Aneel.

the as constructive from base. stages them perspective what cases both interest terms certainly early had conversations the large conversations, an of of customer to Adaptive we've potential grow number the receptivity seen of bought we move I Workday we're we've enterprise very part they've in Adaptive the with think a that forward. and who on I there's about moving extremely but in is in and been we've platform. think in of business the lot But a customers to had planning the the many the optimistic Workday And

Justin Furby

time of some inflect a you and Okay. your next either I’m don't that's year. effort Great. about expectations selling look market one next and Super And year. follow-up, for is And are talked to that's then sort a it this or those student in to think and on year, Prism closer I then helpful. to student When out what sort two Aneel just if Chano. you've of we seems Prism them that starting as the there. curious for been of just curious know about but like how Thanks. I products, know getting you sort throttling

Aneel Bhusri

we're threat Can products. seen. much about It's line cases sure would our that of less one are making I we've with from to sell. I Robynne. say product throttling fit new use numbers, and So ACV perspective where the Prism product say fastest on more lines the we the net a what the is ever growing willingness But

Robynne Sisco

Triple digits.

Aneel Bhusri

into we turn had the see product do Triple we steps a a as turning folks, of those into an as offering building done digit while to product one many business use business little might obvious dollar into to And on have Prism capabilities people one year-over-year as Derek mature a the on growth. not there analytics path one There's first the is we it us upside new line on a some and and we of our expect clear to honestly as of billion cases, that been a Butts, ago. line. that Prism and of analysis the real to analysis, And grow the some begin our continue long-time we've strategy was we've initiatives. surprises

that's coming on scaling first are In where focused getting or four very five into large live the student quarters. building more getting focused those very can terms after production we the we and we're that the business. universities and universities right of But the now, about out large in systems, on think capabilities

Justin Furby

Thanks, helpful. guys. Super

Operator

from comes question line next Piper of the Zukin Alex Jaffray. with Your

is line Your open.

Alex Zukin

strong really for quarter. guys. question congratulations on and taking Hey, Thanks a my

me. from two Just

financials, in about have Adaptive. terms on financials then it think then about first, it of a as next the think net pipeline do XQ around you versus for quick versus activity business? selling the base and terms I follow-up about enterprise into does you the you financials new And how of talk Aneel, compare HR maybe the both year, And So how can in -- on the logos? mid-market or

Aneel Bhusri

So it’s into basically additional HR. HR

Robynne Sisco

customer Well financials into the HR base.

Aneel Bhusri

HR And and I additionally HR. think into

Chano Fernandez

Alex. speaking. Yeah. Chano is This Hi,

into financials those progress engagement great are on going Regarding with the to customers. happy with folding on of is the Clearly, would verticals, key our to say positive a track. is and our within have we be particular customer We seen, the the the have majority be clearly are I quarters there. very we progress yet mapping how base, but

year, In add-on say the being on based go-to-market customer our have additional terms we HR is base, customer customers a into base. set your there. or the advantage since after of is business product a business I of particularly understood of if the the extensions good our would question happy of taking correctly, and customer significant that I this base Especially seen more acceleration growing, and of

Alex Zukin

on second maybe up part pipeline, of And just Thanks. the mid-market that, finishing in terms the enterprise. it. of that just Got question on on financials versus

Aneel Bhusri

we've been say mix as similarly similar percentage basically are before. would having similar I or -- both

into to enterprise in value basically both basically offering go-to-market taking good good there activity implementation, of the fixed we're really significant has medium ability. only the our Clearly So time activities, reference really been and levels. not the since fee in services and and there, the terms base of and traction shortening taking enterprise launch customer is launch our subscription but medium

well. very tracking So that is

We the continue to U.S. both and of terms large well activity, and enterprise momentum in do in internationally. the

Alex Zukin

the revenue quarter and to on may. revenue revenue, possible it if follow-up quick I Adaptive. Adaptive, from and deferred just Robynne, revenue subscription Is get unearned Perfect. in And just contribution the then to a

Robynne Sisco

did number revenue in those to now now would from the recall, $X time given to or quarter deferred contribute you'll came not about revenue we Adaptive in value. $XX we originally the and number forward we sense QX. product than change talk updating If can million at because organic because what of last were $XX the already blurred mentioned imagine, actually be makes this the the in you anticipated. of so we terms lower million the But numbers Adaptive we which also terms finalization cross-selling Workday going would that million of that the the going We with haircut ahead to contributions as Adaptive we're thought we companies, of expected out really that be both quarter That had purely in quarter the across break what's have of of subscription haircut in and think what's lines last anymore. don't be

our and color we of unearned, expected the quarter we were XX% attributable that we is upside and that terms of of Adaptive strength the for that, also from the both so we're our that including quarter sheet this short-term QX, percentage product unearned balance points In balances gave growth all and expecting. last XX% and X into their QX delivered suite for XX% across guiding next quarter we're to

Alex Zukin

Understood.

Okay. much. Thank you so Congrats again.

Operator

RBC Capital Your next question MacMillan Markets. comes from the Ross with line of

open. Your line is

Ross MacMillan

about the super how at remains curious you at about I'm much. strong well strong commentary made the in I do commentary your the Aneel, much HCM as I what Fortune made business me management perspective from momentum durability a Rising numbers. HCM the as rate you terms And to that team very on just would Congrats so think XXX in still XXXX back left wondered you and how was target sustaining from like your of Thanks of growth. see of think Global and

Aneel Bhusri

healthy XXX. We're the I of XX. We're continues be quite Fortune Yeah, the XX% of to yet business. very at Fortune at not a it think XXX

to network our the reality see who companies they referencing have negative haven't companies other can beginning choice yet lot being cloud. large large who continue and we better. the proof of points Workday, don't effect are of a is production in on in Without to with do think a to I we're happy large competition, made companies the where we

you lot depending So opportunity five looking to have where and as it's they us they're there's of at especially they're A of in to their and their adoption you of still the see independent decisions. on America a I geographies think look peers get multinational, the outside cloud have other done. to what Workday like in behind lot based thinks three years for where North globe see a and a geography, impacting and as the deployments successful they're they deployments want multinationals multinational the successful across

of reducing So most the in the largest QX other of there's cost saw markets I'd still a with piece, driven world lot is implementation launch in that there Workday I what the well. a a of middle bulk by enterprise, the group basically with think got in Even top called the bulk the are the well really we cost a of most medium Germany, -- countries, front the of side of the XX world. the it now the medium that us. better opens opportunity companies as opportunity success add story enterprise like implementation, accelerating program, growth economy the outside up of the we've world on medium as of and enterprise the of economy stat, is

Ross MacMillan

pull-forward And That’s renewals. just impacted things in deal a follow-up, some the you then net the bookings mentioned new accelerations, great. and Robynne, strength quarter, that just a few

renewals. implication renewals, were healthy levels, forward What on were renewals you just or Thank larger? you to Just pulled was were maybe the that saying drive were on trying renewals very you. at

Aneel Bhusri

our performance exceed and so up the within continued that or we're very renewal pleased to renewals gross with we XXX% came were meet target QX. renewal very in of renewal quarter and strong net just Yeah, our XX%

Ross MacMillan

and congrats Thanks That's again. great. so much,

Operator

the of from Richard line next question with Davis comes Your Canaccord.

open. is line Your

Richard Davis

Hey, thanks.

they we field couldn't about vendors our talk to interesting in we the of stuff, was guys and some and definitions really was question and working not biggest HR like that we to troubles we the So stuff. different when that, And -- asking as have we asked it, did with the What were finance when digital they then a had, were got was the hang-up of and transformation was right. sent other team. out

you in systems problem. So the in line than evolving? more enough a are where people It's see to but Aneel, long that where whatever, educating the we before this? and and do you of terms do see you've process in do as around been integrators Thanks. that this draw pull you market your cloud Where in on how reengineering

Aneel Bhusri

companies companies I particular, people. hand question, think -- and work in Richard. are these particular the need in based the and biggest HR biggest In industries, to are hand. expense finance for that manufacturing companies Because people in absolutely a it's but asset their not great

that Adaptive as in structures and advantage in place. we beginning HR, in would see a got security see model and big why we've hey, and first what companies we've together. work place, to would financials the at analytics have got operating the us we reporting the throw for then already in and leverage we got our you Workday So working definitely business effectively for they We've did all all we and system like planning unified say not look

way. it's not until companies do definitely together years they're HR play HR they were chosen think five that, that HR. looking where now, So beginning were I to looking just at at to haven't And doing ago for that finance just people and

become is lines product market positive reengineering digitization together think been and do I real both digital -- as that trend. or market have ready a happening ready that So

Richard Davis

Great. man. That's Thanks, super helpful.

Operator

Bank America. Your Kash from the of with next Rangan line comes question of

Your open. line is

Kash Rangan

much. very asked. macro Congratulations question, you assume ask on it's a I'll fantastic Thank been quarter. Hi. guess I not since I a

maybe last results year than that ended saw or rightly two supportive a environment Aneel, were going years and that had business into think we the prophetic So more back, caution was feared two-year all run. largely in you we nice and you QX I up

is really topics CEOs, and not of -- prioritize purview touches are into calendar their are to results sustain and the your CFOs, users. momentum end customers of XXXX, of is your product Workday of that wondering millions talking on necessarily we're from Workday can to similar going makers, feel they you Since XXXX. calendar stretch at good those but back with that really Now millions investors minds What again crossroads practically of for things the CFO the pertinent and you're what's have to keep of a kinds budgets list this your CEOs what decision for as the hearing specifically?

Aneel Bhusri

the I much just just global them pause rhetoric. and don't gives And uncertainty generally pause. the is hear that political business is what them environment know in of good I gives how

are a trade war. aspects worried the potential about Some of companies

now seems thinking? the will it factor back they're So way and into forth. bluster that like Right

separated still good economy global doing you are out we're it in if part cycle. just would like It well. the the of growth I cycles, So say a business seems most seems like economies

to I happening or limited know factor expect of just don't what based I and that the think it environment hangover it. political us but of on predict Europe U.S. any what is everywhere doing to that's people somewhat think surprisingly well be from But how to -- this there's really doing. uncertainty coming not in the

just right of would a it -- now, business. have and on doesn't tuned. I our to ignore normal the And new world it we're the is and amount world impact political huge So hopefully volatility the in stay say trying

Kash Rangan

Congrats results. very Thank I'll yield the on much. to you next the question.

Operator

of next Berg Your the Scott from question comes Needham. line with

Your line is open.

Scott Berg

that sell I two years entire more forward? tie over taking can direct Adaptive moment. become can next you've know just know you question. comfortable it, going how the a Chano the to it the to I can with that you all one be financials take regards I one for it's I is my the Thanks about or don't the from with lessons we Aneel some everyone. as guess platform that it there with help ecosystem, learned in have wants but if customers of three know generically tie Hi, help at you portfolio other. us today but to may to going tell to

Aneel Bhusri

I they the and particular, history success companies the number do. at have the our the so say had I’d look think similar very one very, cultures, – technology takeaway and value of we Well and And you that's if of determinant hoped biggest is failure. field far acquisitions very in in systems they

well. the So companies from that working are extremely part, two

largely think was eggs Workforce see to of in in true be historically Adaptive Workday thing is who in turned we which It's enterprises of large had things to planning, were sales basket out moving the Adaptive our all to the have and for out I is we're and the why Adaptive the going that been was going capabilities and product all Workday interest thesis played what out those and that was planning doors ahead that to planning has knew far all other planning open Workday we put customers like and Adaptive. Planning in the played hoping have we why happened. planning

It's the So Tom coming together. with out two had out always we earlier it that's hoped I and were today. and talking not really companies way case the to played play about

very So fortunate. feel

to Tom. want add anything, You

Tom Bogan

we opportunity We have customers customers lot but agree that. great financials a earlier this new approximately sell continue we stand-alone we've a a momentum. seen added Just Workday in that -- I those are customers to lot of there's the of customers. behind to XXX sell customer that there's those and quarter of opportunity Adaptive to said also additions as interest and resonance, existing to Most

Scott Berg

my Thanks for taking question.

Operator

question of comes with Your next the Evercore. Kirk from line Materne

Your line is open.

Kirk Materne

to Seems planning they're a, you Tom, you of to ultimately I'll Maybe the to add my on after decision connected of much for think buys general that with vision, another like more on lot or quarter. incredible thinking guesstimate know. to their CFOs way on sense know, something engaged can involved field dialogue some when that is of make do that your move Thank another someone thoughts to to much. planning in ready right any you that planning give experience eight around you decision or after or that to an congrats us account. ready and that on conversations? the more very faster the to just a are in to long quarter is you're before there on ultimately cloud sort just sort guys make CFOs financials your have. talking line get come I lag around so way It don't the can of the in a XXX Is ledger or talking your financials? I don't it decide you trying they very follow-up that actually how in they're partners based six now for a have that I'm seems there a of customers into about. a

Tom Bogan

to are financials. are companies playing thesis do the see do system We planning we willing move a that to think than cloud-based perhaps see I they out. earlier

we've So the encouraged around we're their very planning cloud. to conversations had and prospects the customers with moving by

say when we to their result we bit ready decisions when will we timing company. of that company think little that And dependent believe while I that a are do customer an effective more particularly those have the customers the to on I satisfied is agree financials in job follow-up to and cloud financials there they're really opportunities move but customers, around situational. I'd in the Chano, with engaging are opportunities, probably

Chano Fernandez

most planning scalability Kirk, prospects thing Tom. regarding so relevant. agree, is important far cloud the customers feedback from I our think is and getting That's I really the Adaptive is the the and thing positive. that of we're the capabilities super

those see days some that to expect think some to where but cycles we four those value had in customers months time we are XX,XXX a we and of customers quarter in it's of frame double employees, planning six are clearly digits it's If -- but of you going were to implementations. over planning not early yet financial time

discussion and in I to and point great our back a be I that's view and to full very makes taking early there platform. be business about it we'll extend learning position go the on we're days But benefits excited why is in think but sense and a have so we'll value guess to of financial it's how good looking.

Kirk Materne

of all entire term. ahead a movement either on across of dogs kind of kind ahead just in lead or few those? lift customer a in pulling sort that of of know kind more of in is there I'm seeing Thanks. on sort guess look of that or are Are seems to sort be based others? there's to be the nine, one to which nine be just you when maybe follow-up the particular strategies acceleration you you momentum. at the I that, couple you longer one focus if are And guys actually going some on. just taking some front any curious of off that seems moving a financials I vertical building this in references have

Chano Fernandez

was to the just services an been segment. very and area was the financial no the already I'd huge definitely question has cloud interesting and that's Well, Business for for pick up that's to has that's segment for up. a HR. say financials. as tech financial that. not services to about slow services picking nicely move But but begun finance There's market

Aneel Bhusri

given really professional one well portfolio other on that business seems would there. say, core clearly to been the services, Has The be automation health verticals performing PSA our now around of Aneel, more solution I care. strength services,

Kirk Materne

much. Thanks Super. so

Operator

We our Jefferies. question final John with from will Fucci take Di

open. is line Your

Samad Samana

John. is Samana This on for Samad

Just questions. couple a

the for mentioned some broken if accelerated, and when it acceleration us was Geo give could then and whether it HCM financials enterprise accelerate you wondering maybe you additional in both color I on I it then for have at and you ACV. question. by net First, mid-market and did a and out follow-up look

Aneel Bhusri

above. the of All

Samad Samana

Okay.

Aneel Bhusri

board. across the Accelerated

Samad Samana

Okay. Great. Thanks for that.

Just one follow-up.

adopters type are of on more it, are considerably only, already, emerging they or the company any I terms see had like Q&A anything in up it's by you just Prism who customers that that customers Aneel think those production. what Workday Rising bit mentioned they to I'm Looks already mostly in I adopting think half size, type of if us year-over-year. vertical the of in is. started the and for to help HCM something platform at of you oriented about curious Europe maybe are a XXX of patterns understand

Aneel Bhusri

and don't Why in more quite finance HR new now that in us. more customers well. the we operational care it data for to data party space thoughtful a or early procedure finance as analysis opportunity come innovators Right -- interesting answer. a patient bring you few HR do finance all but in on has been bring And so health to seeing I'd category. what well. They an to do product data the They're we're analysis data to there's customers with back characterize a is with as as third

big that come with think it's draw across line I response. far. thoughtful is don't you to I enough more big sample The yet product any draw it's big us so let a So a conclusions. back across set to conclusion and industry

areas not So it's it's what to like where We're any we be. interesting. not it seeing

Samad Samana

my questions on quarter. appreciate Great. and awesome I Well taking congrats an you

Aneel Bhusri

you. Thank

Operator

Ladies joining and you for conclude participation gentlemen, your us. on conference. again Thank for today's Workday's third will This earnings you quarter call. thank

Workday (WDAY) 29 Nov 182019 Q3 Earnings call transcript