Workday Inc. (NASDAQ:WDAY)

The data reveals several notable trends and fluctuations in the financial efficiency ratios over the analyzed quarters.

Receivables Turnover

This ratio exhibits a cyclical pattern with peaks and troughs occurring regularly. Notably, the values oscillate approximately between 4.0 and 7.0, suggesting periodic variations in how quickly receivables are collected. There is no clear long-term upward or downward trend; instead, the ratio fluctuates in a range, which might reflect seasonal or operational influences on collection efficiency.

Payables Turnover

The payables turnover ratio demonstrates higher volatility compared to receivables turnover. It ranges widely from as low as around 11 to peaks above 30. There are sharp rises and declines from one quarter to the next, indicating irregular payment behaviors or changes in credit terms with suppliers. The pattern does not show a consistent trend but suggests fluctuations in the frequency of payment cycles.

Working Capital Turnover

This ratio shows a significant decline over the period, starting from very high values, exceeding 20 in several instances early on, and dropping steadily to approximately 1.5–1.7 in the latest quarters. The sharp early fluctuations, including missing data in one quarter, give way to a plateau at a substantially lower turnover level. This indicates a slowdown in the utilization efficiency of working capital over time, possibly reflecting changes in operational scale or asset management.

Average Receivable Collection Period

The collection period generally fluctuates between 50 and 90 days. Corresponding with the receivables turnover trend, there are regular rises and falls, with a tendency to increase when turnover rates are lower and decrease when turnover rates are higher. This reciprocal relationship is consistent with expectations, as longer collection periods coincide with lower turnover ratios.

Average Payables Payment Period

The payment period varies from about 11 to 33 days, showing less dramatic swings than the payables turnover ratio but still reflecting quarter-to-quarter variability. Periods of extended payment terms alternate with shorter periods, suggesting changes in payment policy or supplier arrangements. No clear progressive trend towards longer or shorter payment cycles is evident.

In summary, the working capital turnover has markedly decreased, indicating diminished efficiency in using capital resources. Receivables and payables turnover ratios fluctuate within relatively stable bands, reflecting cyclical operational dynamics rather than a directional trend. The collection and payment periods mirror these fluctuations, maintaining a consistent inverse relationship with turnover ratios. The overall data imply operational variability and adaptations over time without sustained improvement or deterioration in working capital management efficiency.

The revenue data exhibits a consistent upward trajectory over the analyzed periods, beginning at 825 million US dollars in April 2019 and progressively increasing to 2,348 million US dollars by July 2025. This steady growth suggests sustained business expansion or increasing market demand.

Trade and other receivables display significant fluctuations throughout the quarters. Initially, receivables rise sharply from 543 million US dollars in April 2019 to a peak of 1,570 million US dollars in January 2023, albeit with intermittent decreases in between. This volatility could indicate variability in sales collection patterns or changes in credit policies. After the peak, receivables remain elevated, generally staying above 1,000 million US dollars, with some quarters showing notable spikes, such as 1,950 million in October 2024, before slightly decreasing towards 1,609 million in July 2025.

The receivables turnover ratio demonstrates cyclical fluctuations yet maintains a moderate range. This ratio varies from lows around 3.96 to highs near 6.94 without a clear long-term trend of improvement or decline. Periods of lower turnover coincide with higher receivables, potentially reflecting slower collections during those quarters. The alternating pattern suggests the company experiences varying efficiency in converting receivables into cash over the quarters but without a consistent directional trend.

Overall, the data indicates robust revenue growth with considerable variability in receivables management efficiency. The fluctuating receivables and turnover ratios imply episodic challenges in cash collection processes or changing credit terms, which merit further investigation to optimize working capital management.

Revenue Trend

Consistent and steady increase from 825 million to 2,348 million US dollars over the period.

Trade and Other Receivables Trend

Highly variable with notable peaks and troughs, rising markedly overall with intermittent decreases.

Receivables Turnover Ratio

Fluctuating within a moderate range without a definitive long-term increasing or decreasing trend.

Implications

Strong revenue growth is contrasted by variable receivables performance, indicating potential areas for improved credit control and cash flow management.

The financial data reveals several notable trends across the periods analyzed. The cost of revenues, measured in millions of US dollars, exhibits a general upward trajectory with fluctuations. Starting at 243 in April 2019, the cost increased steadily with some minor declines, reaching a peak of 582 million in July 2025. This indicates an overall growth in operational expenses related to revenue generation over the years.

Accounts payable, also recorded in millions of US dollars, displays more variability over the same time frame. Initial values hovered in the 30s, with sporadic increases and decreases. From April 2019 through early 2021, the values oscillated moderately, but starting in April 2022, there are pronounced spikes, reaching as high as 154 million in January 2023, followed by a decline and subsequent fluctuations around 70 to 110 million through mid-2025. This suggests periods of increased liabilities to suppliers, possibly due to changes in purchasing practices, credit terms, or operational scaling.

The payables turnover ratio, which reflects how often accounts payable is paid off during a period, demonstrates considerable variation and some inconsistency. While data is missing for early periods, starting from January 2020, the ratio swings erratically between lows around 11 and highs exceeding 30. The oscillations indicate fluctuations in payment efficiency or changes in payment policies. Notably, lower ratios in certain intervals, such as in April 2022 and January 2023, align with the peaks in accounts payable, signifying slower turnover in payables when liabilities are elevated.

In summary, the analysis shows increased costs of revenue continuing over the years, accompanied by heightened and more volatile accounts payable figures. The payables turnover ratio's volatility may reflect changing operational or credit management conditions during the periods observed. The coexistence of rising costs and fluctuating payables suggests evolving business dynamics that impact cash flow management and operational expense timing.

Costs of Revenues Trend

Overall growth from 243 million to 582 million, indicating increased expenses related to sales activity.

Accounts Payable Trend

Variable pattern with significant spikes around early 2023, implying increased supplier liabilities and potential changes in credit terms.

Payables Turnover Ratio

Marked variability, with lower turnover rates coinciding with higher accounts payable, suggesting slower payment cycles during certain periods.

Working Capital

The working capital figures show significant volatility in early periods, with a notable dip into negative territory in the second quarter of 2019 (-645 million USD) and again in the first quarter of 2021 (-305 million USD). Following these fluctuations, working capital generally trends upward from mid-2020 onwards, rising from 1,161 million USD in July 2020 to a peak of 5,462 million USD in July 2025. This suggests improving liquidity and potentially more efficient asset management over time, despite intermittent setbacks.

Revenues

Revenues exhibit a consistent upward trajectory throughout the entire period. Starting at 825 million USD in April 2019, revenues steadily increase each quarter, reaching approximately 2,348 million USD by July 2025. The trend indicates robust growth in sales or service income, with no significant declines or plateaus, reflecting strong business performance and market demand.

Working Capital Turnover Ratio

The working capital turnover ratio data is incomplete in the early periods but reveals important insights when available. Initially, in early 2020, the turnover ratio was quite elevated—28.97 in April 2020—before declining sharply to more moderate levels around 5 to 3 in subsequent quarters. From late 2021 onwards, the ratio stabilizes around values ranging from approximately 1.5 to 1.8, with slight fluctuations quarter to quarter. This indicates that earlier turnover rates, which were extremely high, normalize over time, suggesting that the company initially had a very efficient use of working capital relative to revenues, but as working capital increases significantly, the rate at which revenues are generated per unit of working capital decreases and stabilizes at a sustainable level.

Overall Trends and Insights

The overall data reflect a company that experienced early volatility in liquidity management but has since moved towards stable and increasing working capital levels, aligned with consistent revenue growth. The dramatic increase in working capital from 2021 onwards may imply greater investments in current assets or a shift in operational strategy. Meanwhile, the revenue growth continues unabated, demonstrating market expansion or product/service strength. The stabilization of the working capital turnover ratio suggests a maturing operational efficiency where working capital is adequately supporting revenue generation without extremely high turnover rates, balancing liquidity with growth efforts.

Receivables Turnover Ratio

The receivables turnover ratio demonstrates a fluctuating pattern over the periods analyzed. Starting from a ratio of 4.13 in April 2020, it peaks periodically at values above 6, notably reaching 6.94 in April 2022 and 6.68 in April 2024. The ratio generally oscillates between approximately 4.0 and 6.9, indicating variability in how efficiently receivables are converted into cash during different quarters. This cyclical behavior suggests variations in sales or collections practices, with no definitive upward or downward long-term trend.

Average Receivable Collection Period

The average receivable collection period inversely mirrors the turnover ratio, fluctuating between roughly 53 days and 92 days. The highest collection periods occur around January 2023 (92 days) and April 2021 (88 days), indicating slower receivable collections during those quarters. Conversely, the shortest collection periods, near 53 days, are observed multiple times (July 2021, April 2022, and April 2020), reflecting faster conversion of receivables to cash. These variations align with the turnover ratio's changes, confirming typical inverse correlation between these metrics.

Trend Analysis and Insights

Overall, the data indicates recurring cyclical trends in receivables management efficiency. Peaks in receivables turnover tend to correspond with troughs in collection period and vice versa. These fluctuations may be attributed to seasonal factors, changes in credit policy, customer payment behavior, or sales volume variations. The absence of a clear long-term trend suggests stable yet variable receivables dynamics, without significant deterioration or improvement over the observed timeframe.

Payables Turnover Ratio

The payables turnover ratio demonstrates significant variability over the observed periods. Starting from a baseline absence of data until the period ending April 30, 2020, it initially rises sharply from 18.51 to a peak of 31.83 by July 31, 2020. Following this peak, the ratio fluctuates between approximately 11 and 28, without a consistent upward or downward trend. Notable declines occur after July 2021 and again after April 2022, with the ratio reaching lows near 11.16 and 12.14, respectively. In recent quarters, the ratio stabilizes within the range of roughly 19 to 27, suggesting some normalization in payables management or turnover activity.

Average Payables Payment Period

The average payables payment period complements the payables turnover data, exhibiting an inverse relationship as expected. The payment period begins around 20 days in April 2020, falls to its shortest levels near 11 days by July 2020, then fluctuates more broadly in subsequent periods. It peaks significantly around 33 days by January 2023, indicating a substantial lengthening in the payment period during that time frame. Following this peak, the payment period generally decreases, oscillating in the mid-teens range with slight variations, settling between approximately 14 and 19 days in the most recent quarters. This pattern indicates periods of both accelerated and delayed payments, consistent with the changes in turnover ratio.

Overall Analysis

The payables turnover ratio and average payment period data collectively suggest dynamic payables management throughout the timeframe. The periods of higher turnover ratios, paired with shorter payment durations, imply more rapid clearance of payables, likely reflecting strategic payment acceleration or favorable supplier terms. Conversely, periods of lower turnover and extended payment days indicate slower payment cycles, which may be indicative of cash management strategies or temporary supplier financing. The fluctuations suggest responsiveness to changing internal or external financial conditions rather than static operational processes.