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On Friday, Goldman Sachs adjusted its outlook on Workiva (NYSE:WK), reducing the stock’s price target from $105.00 to $101.00 while maintaining a Buy rating. The decision by analyst Adam Hotchkiss followed Workiva’s first quarter of 2025 revenue, which slightly surpassed consensus expectations by 1% and reaffirmed its full-year 2025 revenue guidance. The company, currently valued at $4.15 billion, has maintained impressive revenue growth of 17.24% over the last twelve months, according to InvestingPro data. This reaffirmation indicates sustained momentum in the company’s multi-solution platform deals, despite a growing cautiousness in the buying environment towards the quarter’s end.
Workiva’s guidance for the second quarter of 2025 suggests a potential acceleration, with the company expecting to maintain around 20% subscription revenue growth for the remainder of the year, a rate consistent with first-quarter performance. This outlook is set against a backdrop of increased scrutiny by customers and prospects over budget allocations. However, management has indicated that, following a robust 2024, new bookings could feel the effects of a less favorable buying environment, which might impact revenue growth in 2026 more than in 2025.
Goldman Sachs highlighted the importance of monitoring Workiva’s forward-looking indicators, such as committed remaining performance obligations (cRPO) and billings growth. These indicators accelerated in the first quarter, growing faster than in the fourth quarter of 2024, which supports the expectation of sustained subscription revenue growth. Despite uncertainties due to the cautious budget environment, Workiva’s consistent execution and fundamental performance are expected to drive share price outperformance throughout the year.
The firm’s analysis suggests that while there is a level of uncertainty stemming from the budget environment, Workiva’s ability to capitalize on its multi-solution opportunities should underpin the stock’s performance. Goldman Sachs remains optimistic about Workiva’s prospects, setting a revised 12-month price target of $101, down from the previous target of $105. Despite the stock’s significant YTD decline of 32.06%, InvestingPro’s Fair Value analysis suggests the stock is currently trading near its fair value, with analyst targets ranging from $86 to $127.43 per share.
In other recent news, Workiva Inc . reported its first-quarter 2025 earnings, surpassing analysts’ expectations with an earnings per share (EPS) of $0.14, double the forecasted $0.07. The company’s revenue reached $206 million, slightly above the projected $204.19 million, marking a 17% increase from the same period last year. Subscription revenue, a significant contributor, grew by 20% year-over-year, reflecting strong demand for Workiva’s services. Despite these positive financial results, Workiva’s stock experienced a minor decline in after-hours trading. Analysts noted a more cautious buying environment towards the end of the quarter, but Workiva maintained its full-year revenue guidance, projecting between $864 million and $868 million. The company also highlighted its ongoing commitment to sustainability initiatives, with significant wins in sustainability reporting contracts. Workiva’s platform continues to be a key differentiator, with a notable increase in large contract customers and a high gross retention rate of 97%.
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