Common-Size Income Statement
Quarterly Data
Workday Inc., common-size consolidated income statement (quarterly data)
Based on: 10-Q (reporting date: 2025-04-30), 10-K (reporting date: 2025-01-31), 10-Q (reporting date: 2024-10-31), 10-Q (reporting date: 2024-07-31), 10-Q (reporting date: 2024-04-30), 10-K (reporting date: 2024-01-31), 10-Q (reporting date: 2023-10-31), 10-Q (reporting date: 2023-07-31), 10-Q (reporting date: 2023-04-30), 10-K (reporting date: 2023-01-31), 10-Q (reporting date: 2022-10-31), 10-Q (reporting date: 2022-07-31), 10-Q (reporting date: 2022-04-30), 10-K (reporting date: 2022-01-31), 10-Q (reporting date: 2021-10-31), 10-Q (reporting date: 2021-07-31), 10-Q (reporting date: 2021-04-30), 10-K (reporting date: 2021-01-31), 10-Q (reporting date: 2020-10-31), 10-Q (reporting date: 2020-07-31), 10-Q (reporting date: 2020-04-30), 10-K (reporting date: 2020-01-31), 10-Q (reporting date: 2019-10-31), 10-Q (reporting date: 2019-07-31), 10-Q (reporting date: 2019-04-30).
- Revenue Composition
- Subscription services consistently represent the dominant segment of revenues, showing a gradual increase from approximately 85% in early 2019 to around 92% by early 2025. Conversely, professional services' share of revenues steadily declines over the same period, dropping from about 15% to roughly 8%. This shift indicates an increasing reliance on subscription-based offerings.
- Cost Structure
- The costs associated with subscription services exhibit a slight increase relative to revenues, moving from near -13.6% to about -15.6%. Costs related to professional services decrease more notably, from roughly -15.8% down to approximately -8.4%. Overall costs of revenues improve marginally, declining from near -29.5% to about -24%.
- Gross Profit Trends
- Gross profit margins demonstrate a positive trend, starting around 70.5% of revenues in 2019 and rising to approximately 76% by 2025. The improvement reflects both the shifting revenue mix towards subscription services and the more efficient cost base over time.
- Operating Expenses
- There is a marked reduction in product development expenses as a percentage of revenues, descending from over -42% to just below -30%. Sales and marketing expenses show modest fluctuations but trend slightly downward from just over -33% to nearly -28%. General and administrative costs remain relatively stable, fluctuating narrowly around -9% to -10%. Notably, restructuring costs appear sparsely from 2023 onward, increasing up to approximately -7.4% of revenues in early 2025.
- Operating Income
- Operating income margins improve significantly over the period. Initially, negative at around -15%, operating losses become smaller and eventually turn positive by mid-2021, reaching peaks above 7% of revenues by late 2024. Despite intermittent declines linked to restructuring expenses, the overall trajectory is toward sustained operating profitability.
- Other Income and Taxation
- Other income (expense), net, exhibits variability but trends positively after 2020, contributing up to around 3% of revenues in recent quarters. Income tax provisions are mostly minimal with some volatility; a notable tax benefit spike occurs early 2024, causing a disproportionately high tax benefit ratio, likely due to a discrete event.
- Net Income
- The net income margin follows a pattern similar to operating income, with losses early on transitioning to gains by mid-2021. A pronounced net income margin spike occurs early 2024, influenced in part by tax benefits, reaching over 60%. Excluding this anomaly, net margins generally increase steadily, stabilizing in the mid-single digits by 2025.
- Overall Insights
- The financial data reflects a strategic and operational shift favoring subscription services, driving improved gross margins and operating profitability. Cost efficiencies and controlled operating expenses contribute to sustainable earnings growth. The presence of restructuring expenses and tax anomalies suggests ongoing organizational adjustments and discrete fiscal events impacting periodic results.