Analysis of Property, Plant and Equipment
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- Statement of Comprehensive Income
- Analysis of Short-term (Operating) Activity Ratios
- Enterprise Value (EV)
- Dividend Discount Model (DDM)
- Net Profit Margin since 2013
- Return on Assets (ROA) since 2013
- Total Asset Turnover since 2013
- Price to Operating Profit (P/OP) since 2013
- Price to Sales (P/S) since 2013
- Analysis of Debt
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Property, Plant and Equipment Disclosure
Workday Inc., balance sheet: property, plant and equipment
US$ in millions
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).
The analysis of the property, plant, and equipment data reveals several trends over the six-year period ending January 31, 2025. Overall, there is a consistent increase in gross property and equipment values, reflecting ongoing investments across various asset categories.
- Computers, equipment, and software
- This category shows a steady upward trend from $723 million in 2020 to a peak of $1,387 million in 2024, followed by a slight decline to $1,370 million in 2025. The growth indicates continued investment in technological assets, which plateau toward the end of the period.
- Buildings
- Building assets demonstrate moderate growth with values rising from $489 million in 2020 to $752 million in 2025. The increase is gradual and stable, suggesting measured capital expenditures in physical infrastructure.
- Leasehold improvements
- Leasehold improvements show fluctuations with a dip from $204 million in 2021 to $158 million in 2022, followed by a consistent increase reaching $252 million in 2025. This pattern may indicate timing differences in capitalizing leasehold-related expenditures.
- Furniture, fixtures, and transportation equipment
- Assets in this category steadily increase from $52 million in 2020 to $108 million in 2025, representing a doubling over the period. This consistent growth suggests ongoing asset additions supporting operational activities.
- Land and land improvements
- Land assets remain relatively stable, around $39 million to $81 million, with a notable increase between 2021 and 2022, after which the value plateaus. The stability after the increase indicates limited further acquisition or revaluation activities.
- Property and equipment, gross
- The aggregate gross value of property and equipment rises markedly from $1,493 million in 2020 to $2,563 million in 2025, reflecting the cumulative effect of asset purchases and capital investments across categories.
- Accumulated depreciation and amortization
- Accumulated depreciation shows a consistent increase in magnitude from -$557 million in 2020 to -$1,324 million in 2025. This reflects ongoing asset usage and aging, with depreciation accumulating in line with asset base growth.
- Property and equipment, net
- Net property and equipment, calculated as gross property and equipment less accumulated depreciation, increases from $936 million in 2020 to $1,239 million in 2025. The growth, although positive, is less pronounced compared to gross values, indicating depreciation partially offsetting asset acquisitions.
In summary, the company displays a clear pattern of expanding its asset base, particularly in technology and infrastructure, balanced by systematic depreciation. The net book value growth suggests effective asset management, supporting operational capacity while accounting for asset wear and usage over time.
Asset Age Ratios (Summary)
Workday Inc., asset age ratios
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).
The data reveals a progressive increase in the average age ratio of property, plant, and equipment over the examined periods, rising steadily from 38.28% in early 2020 to 53.34% by early 2025. This trend indicates an aging asset base, suggesting that a growing proportion of the assets have been in use for a substantial portion of their expected life.
The estimated total useful life of assets shows variability, initially remaining at 7 years for 2020 and 2021, then increasing to 8 years for 2022 and 2023, peaking at 12 years in 2024, before slightly decreasing to 10 years in 2025. This fluctuation could reflect changes in asset composition, improvements in asset durability, or revised management estimates of asset longevity.
The estimated age, representing the time elapsed since asset purchase, remains relatively stable at 3 to 4 years between 2020 and 2023, then increases to 6 years in 2024 before declining to 5 years in 2025. This pattern suggests variations in asset acquisition timing, potentially indicating periods of lower capital expenditures followed by recent asset additions.
The estimated remaining life of assets generally stays consistent at 4 years from 2020 through 2023, extending to 6 years in 2024, then reducing to 5 years in 2025. This reflects a similar pattern to the total useful life changes, implying adjustments in asset life expectations and asset age structure.
Overall, the data demonstrate an aging asset base with moderate adjustments to estimated asset lifespans and remaining useful lives, indicating ongoing asset utilization alongside periodic reassessment of asset value and durability assumptions.
Average Age
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).
2025 Calculations
1 Average age = 100 × Accumulated depreciation and amortization ÷ (Property and equipment, gross – Land and land improvements)
= 100 × ÷ ( – ) =
- Accumulated depreciation and amortization
- The accumulated depreciation and amortization shows a consistent upward trend over the six-year period. Starting at US$557 million in 2020, it increased steadily each year, reaching US$1,324 million by 2025. This reflects ongoing wear and usage of property and equipment assets and indicates a continuous allocation of expense corresponding to asset usage or obsolescence.
- Property and equipment, gross
- The gross value of property and equipment also demonstrated consistent growth from US$1,493 million in 2020 to US$2,563 million in 2025. This increase suggests considerable investment and expansion in tangible assets, reflecting company growth or upgrades in facilities and equipment.
- Land and land improvements
- Land and land improvements showed initial fluctuation, decreasing slightly from US$39 million in 2020 to US$37 million in 2021, followed by a notable increase to US$81 million in 2022. From 2022 onward, the value remained stable at US$81 million, indicating either acquisition or revaluation around 2022 and subsequent stabilization without further substantial changes.
- Average age ratio
- The average age ratio, expressed as a percentage, increased steadily from 38.28% in 2020 to 53.34% in 2025. This suggests that on average the property and equipment assets are aging, which may imply a greater proportion of older assets within the fleet. This could have implications for future depreciation expense or potential capital expenditure requirements to refresh aging assets.
Estimated Total Useful Life
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).
2025 Calculations
1 Estimated total useful life = (Property and equipment, gross – Land and land improvements) ÷ Depreciation expense
= ( – ) ÷ =
- Property and Equipment, Gross
- The gross value of property and equipment has shown a consistent upward trend over the observed periods. Starting from US$1,493 million in early 2020, it increased each year, reaching US$2,563 million by early 2025. This reflects sustained investment or acquisition of fixed assets over time, with growth appearing to moderate slightly in the last two years.
- Land and Land Improvements
- Values for land and land improvements remained relatively stable between 2020 and 2025, with a notable increase from US$37 million in early 2021 to US$81 million in early 2022. After that point, the value held steady at US$81 million through 2025. This suggests a significant acquisition or revaluation event around 2022, followed by stability in this asset class.
- Depreciation Expense
- Depreciation expense generally increased from US$201 million in early 2020 to a peak of US$275 million in early 2023, indicating higher depreciation likely due to asset additions. However, a decline occurred in 2024 with depreciation dropping to US$203 million, followed by a partial rebound to US$243 million in 2025. This fluctuation could be associated with changes in asset composition, useful life estimates, or depreciation methods.
- Estimated Total Useful Life
- The estimated total useful life of property and equipment showed an upward adjustment from 7 years in 2020 and 2021 to 8 years in 2022 and 2023, then a more pronounced increase to 12 years in 2024 before decreasing slightly to 10 years in 2025. This indicates periodic re-assessment of asset longevity assumptions, which impacts depreciation calculations and reported expense trends.
Estimated Age, Time Elapsed since Purchase
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).
2025 Calculations
1 Time elapsed since purchase = Accumulated depreciation and amortization ÷ Depreciation expense
= ÷ =
- Accumulated Depreciation and Amortization
- The accumulated depreciation and amortization exhibit a consistent upward trend over the period analyzed. Starting at 557 million US dollars in 2020, this figure more than doubled by 2025, reaching 1324 million US dollars. This steady increase indicates ongoing wear and reduction in value of the company’s property, plant, and equipment assets. The growth is most pronounced between 2020 and 2023, with the rate of increase moderating slightly in the last two years.
- Depreciation Expense
- Depreciation expense shows variability within the observed timeframe. It increased gradually from 201 million US dollars in 2020 to a peak of 275 million US dollars in 2023. Following this peak, there was a significant decline to 203 million US dollars in 2024, before rising again to 243 million US dollars in 2025. These fluctuations suggest changes in the asset base or depreciation policies, possibly influenced by acquisitions, disposals, or shifts in depreciation methods.
- Time Elapsed Since Purchase
- The average time elapsed since purchase of the assets grew from 3 years in 2020 and 2021 to 4 years in 2022 and 2023, before increasing further to 6 years in 2024, then slightly decreasing to 5 years in 2025. This pattern indicates an aging asset base with intermittent renewal or replacement activities affecting the average age.
- Summary of Insights
- Overall, the data reveal a growing accumulated depreciation consistent with asset aging, combined with fluctuating annual depreciation expense levels. The gradual increase in the average age of assets signals a maturing asset portfolio, though minor reductions in age during 2025 may reflect recent investments or asset turnover. The variability in depreciation expense suggests dynamic asset management practices impacting expense recognition patterns.
Estimated Remaining Life
Based on: 10-K (reporting date: 2025-01-31), 10-K (reporting date: 2024-01-31), 10-K (reporting date: 2023-01-31), 10-K (reporting date: 2022-01-31), 10-K (reporting date: 2021-01-31), 10-K (reporting date: 2020-01-31).
2025 Calculations
1 Estimated remaining life = (Property and equipment, net – Land and land improvements) ÷ Depreciation expense
= ( – ) ÷ =
- Property and Equipment, Net
- The net value of property and equipment demonstrated a consistent upward trajectory from 2020 to 2025, increasing from $936 million in 2020 to $1,239 million in 2025. The growth indicates ongoing investments or acquisitions offsetting depreciation, with the most notable increments occurring between 2020 and 2022.
- Land and Land Improvements
- The value of land and land improvements remained relatively stable over the period, starting at $39 million in 2020, experiencing a slight decrease to $37 million in 2021, then rising sharply to $81 million in 2022. From 2022 onwards, this figure remained constant at $81 million, suggesting a one-time revaluation or acquisition that significantly boosted this asset's recorded value, with no subsequent changes recorded.
- Depreciation Expense
- Depreciation expense showed an increasing trend from $201 million in 2020 to a peak of $275 million in 2023. However, it decreased substantially to $203 million in 2024 before rising again to $243 million in 2025. This fluctuation may reflect changes in asset base composition, useful life estimates, or accounting policies affecting depreciation calculation.
- Estimated Remaining Life
- The estimated remaining life of the assets held steady at 4 years from 2020 through 2023, followed by an increase to 6 years in 2024 and then a slight decrease to 5 years in 2025. The extension in asset life suggests reassessment of useful life assumptions, potentially indicating either asset upgrades or changes in asset usage expected to prolong their useful period.