Earnings call transcript: Workiva Q2 2025 earnings exceed forecasts, stock dips

Workiva Inc (WK) reported strong financial results for the second quarter of 2025, significantly surpassing earnings expectations. The company posted an earnings per share (EPS) of $0.19, well above the forecasted $0.05, marking a surprise increase of 280%. Revenue reached $215 million, slightly exceeding the forecast of $208.86 million. Despite these positive results, Workiva’s stock fell 4.02% during regular trading hours, closing at $66.50, though it saw a slight uptick of 0.54% in aftermarket trading. According to InvestingPro data, the company maintains impressive gross profit margins of 76.75% and is expected to return to profitability this year.

Key Takeaways

• Workiva’s Q2 2025 EPS and revenue both exceeded analyst expectations.
• Despite strong earnings, the stock price fell by 4.02% during regular trading.
• The company is focusing on expanding its AI capabilities and enhancing its platform.

Company Performance

Workiva reported a 21% year-over-year increase in total revenue for Q2 2025, driven by a 23% rise in subscription revenue. The company’s gross retention rate stood at an impressive 97%, with a net retention rate of 114%. These metrics underscore Workiva’s ability to retain and expand its customer base, even amid moderate macroeconomic uncertainties affecting various sectors. InvestingPro analysis reveals the company maintains a healthy liquidity position with a current ratio of 1.78, indicating strong ability to meet short-term obligations.

Financial Highlights

• Revenue: $215 million, up 21% year-over-year
• Subscription revenue: $198 million, up 23% year-over-year
• Non-GAAP operating margin: 3.8%
• Cash, cash equivalents, and marketable securities: $814 million

Earnings vs. Forecast

Workiva’s actual EPS of $0.19 far exceeded the forecasted $0.05, representing a 280% surprise. This substantial beat reflects the company’s strong operational performance and strategic initiatives. Revenue also surpassed expectations by 2.94%, coming in at $215 million compared to the anticipated $208.86 million.

Market Reaction

Despite the positive earnings report, Workiva’s stock declined by 4.02% during regular trading, closing at $66.50. The stock is trading closer to its 52-week low of $60.50, well below the 52-week high of $116.83. However, in aftermarket trading, the stock saw a slight recovery, rising by 0.54% to $66.86, indicating some positive investor sentiment following the earnings release. InvestingPro analysis suggests the stock is currently undervalued, with analysts setting price targets ranging from $85 to $105. For deeper insights into undervalued opportunities, visit our Most Undervalued Stocks list.

Outlook & Guidance

For the full year 2025, Workiva projects total revenue between $870 million and $873 million, with subscription revenue growth expected to be approximately 20%. The company also anticipates a non-GAAP operating margin of 7-7.5% and a free cash flow margin of 10.5%. These projections reflect Workiva’s focus on sustainable and profitable growth. With a 5-year revenue CAGR of 20% and positive analyst sentiment, Workiva shows promising growth potential. Discover more detailed financial metrics and 12 additional ProTips with an InvestingPro subscription.

Executive Commentary

CEO Julie Isco highlighted the company’s strategic focus: "We continue to see companies standardize on the Workiva platform and expand their solution use across financial reporting, GRC, sustainability, and industry-specific solutions." She also noted the company’s strong positioning: "We have spent a decade and a half building trusted relationships with our customers."

Risks and Challenges

• Macroeconomic uncertainties could impact customer spending and deal cycles.
• The sustainability market, a smaller portion of Workiva’s revenue, is experiencing demand moderation.
• Competition from point solutions and legacy technologies poses ongoing challenges.

Q&A

During the earnings call, analysts inquired about the dynamics of the sustainability market, the company’s AI strategy, and the implications of the current macroeconomic environment. Workiva emphasized its strong customer metrics and platform differentiation in response to these queries.

Full transcript - Workiva Inc (WK) Q2 2025:

Gary, Conference Call Operator: Good afternoon, ladies and gentlemen. My name is Gary, and I will be your host operator on this call. After the prepared comments, we will conduct a question and answer session. Instructions will be provided at that time. Please note that this call is being recorded on 07/31/2025 at 5PM Eastern Time.

I would now like to turn the meeting over to your host for today’s call, Katie White, Senior Director of Investor Relations at Workiva. Please go ahead.

Katie White, Senior Director of Investor Relations, Workiva: Good afternoon, and thank you for joining Workiva’s Q2 twenty twenty five conference call. During today’s call, we will review our second quarter results and discuss our guidance for the third quarter and full year 2025. Today’s call will include comments from our Chief Executive Officer, Julie Isco followed by our Chief Financial Officer, Jill Clint. We will then open the call up for a Q and A session, where we will be joined by Mike Roth, our Chief Strategy Officer. After market closed today, we issued a press release, which is available on our Investor Relations website along with supplemental materials.

This conference call is being webcast live, and following the call, an audio replay will be available on our website. During today’s call, we will be making forward looking statements regarding future events and financial performance, including guidance for the third quarter and full fiscal year 2025. These forward looking statements are based on our assumptions as to the macroeconomic, political, and regulatory environment as of today, reflect our best judgment based on factors currently known to us, and are subject to significant risks and uncertainties. Workiva cautions that these forward looking statements are not guarantees of future performance. We undertake no obligation to update or revise these statements.

If the call is reviewed after today, the information presented during this call may not contain current or accurate information. Please refer to the company’s annual report on Form 10 ks and subsequent filings with the SEC for factors that may cause our actual results to differ materially from those contained in our forward looking statements. Also, during the course of today’s call, we will refer to certain non GAAP financial measures. Reconciliations of GAAP and non GAAP measures are included in today’s press release. With that, we’ll begin by turning the call over to Workiva’s CEO, Julie Isco.

Julie Isco, Chief Executive Officer, Workiva: Thank you, Katie, and thank you all for joining us today. In 2025, we delivered another quarter of solid financial performance, powered by the continued demand for our broad portfolio of solutions and our unified platform. We beat the high end of our revenue guidance with 23 growth subscription revenue and 21% growth in total revenue. We also exceeded non GAAP operating margin guidance by three eighty basis points. Our business results reflect continued execution on the four pillars of our growth strategy.

Our connected platform, our high value best of breed solutions, a high performing partner ecosystem and continued global expansion. We continue to see companies standardize on the Workiva platform and expand their solution use across financial reporting, GRC, sustainability and industry specific solutions. Workiva continues to be a clear choice for those businesses that are looking to drive innovation across the office of the CFO, while reducing total cost of ownership with a unified platform. The success of our strategy is showcased by the continued strength in our large contract cohorts. In Q2, the number of contracts valued over $100,000 increased 27%.

Those over 300,000 increased 37% and contracts valued over $500,000 increased 35%, all compared to 2024. This growth was driven by both additional solution sales within our existing customer base and the acquisition of larger new logos. We are not just focused on growth. We are also committed to profitable growth. Entering the 2025, we are raising our operating margin outlook to account for anticipated margin expansion in both Q3 and Q4.

We also remain committed to the 2027 and 2000 and 30 operating margin targets that we announced a year ago. We believe that our disciplined approach to margin expansion will deliver on these results. While in the macro environment, economic conditions are still somewhat uncertain, We remain confident in our long term prospects. The breadth of our solution portfolio and the resilience of our customer demand provide us with multiple levers for sustained growth. From my conversations with our customers and our prospects, the top priorities of CFOs and finance leaders remain constant.

They want to protect margins while funding growth. They want to better manage risks and controls and they want to embrace data and AI to transform their legacy processes. The Workiva platform provides the innovation, the productivity gains and the compelling value that our customers need to enhance their operational productivity and to drive their transformations. That compelling customer value is showcased by some of the large platform deals that we had in Q2. We continue to win with our broad portfolio of solutions.

The first example is a U. S.-based Fortune 500 bank that signed a 7 figure expansion deal across financial reporting, GRC and sustainability. This twelve year loyal SEC and GRC customer significantly increased their use of the platform with the purchase of bank regulatory reporting, sustainability reporting and Workiva Carbon. The primary purchasing driver for this opportunity was large financial institution readiness as outlined by the Federal Reserve. This ratings framework requires integrated governance and rigorous risk analytics across all material risk areas, including climate risks.

The deal was sourced and will be delivered by a big four firm. Second, we signed a mid 6 figure new logo deal with a large UK based asset management company. This firm sought to consolidate its tech stack by eliminating redundant point solutions. This led to the purchase of four Workiva solutions, ECEF, multi entity reporting, sustainability reporting and controls management. The differentiators that led to this five year deal were Workiva strategic partnerships with big four advisory firms, our ability to scale with the customers requirements and the option for fee based premium customer support.

And third, we signed a mid 6 figure 5 solution new logo deal with the South American utility company. They purchased SEC reporting, controls management, audit management, risk management, and sustainability, all to support a finance transformation project. The Workiva platform will be a replacement for manual processes used to assemble and file disclosures to the SEC, and it will also replace a legacy ERP based GRC solution. This deal was sourced and will be delivered by a big four firm. It’s not just about platform wins.

Financial reporting along with our financial services specific solutions remains the primary driver of Workiva’s revenue. In Q2, we saw broad based demand for our financial reporting solutions, including SEC reporting, multi entity reporting, insurance reporting and fund reporting. A key theme throughout the quarter was the sustained strong performance we achieved in financial services. This was powered by our tailored solutions for banks, investment firms and insurers. These solutions support customers in their required financial disclosures.

And in the case of banks, insurance companies and investment firms, our solutions also support operational disclosures that are mission critical to the operations of their businesses. We continue to see strong demand across this broad TAM as our platform has proven to streamline data management and reporting processes, reduce risk and increase ROI across a wide range of customer requirements. Since debuting our public fund reporting solution earlier this year, we’ve seen strong uptake across private, regulated and public funds, which is highlighting the promise of this rapidly expanding market. Asset managers are accelerating fund launches to drive growth and that surge is heightening their need for automation to keep up. A great example of this is an account expansion deal with a Canadian financing company.

This company signed a high 6 figure account expansion deal to add bank reporting and multi entity reporting. They also expanded their use across fund reporting. Over the past six years, this loyal customer has grown with us since first adopting Workiva’s regulated fund reporting solution in 2019. Last quarter, they expanded that footprint by onboarding more than 100 public funds through our new public fund solution. They also added bank reporting capabilities specifically for Basel Pillar three, which mandates that financial institutions disclose a harmonized set of qualitative and quantitative metrics so investors and counterparties can assess their capital strength and risk profile.

Another great Q2 fund reporting win was a mid 6 figure new logo deal with a New York based investment company. This company purchased fund reporting in a competitive win over a legacy financial printer. This customer was using a manual labor intensive process to report on nearly 150 funds. They chose Workiva for our efficiency and platform differentiation over legacy technology and our ability to scale into additional use cases later down the line. This deal was sourced and will be implemented by a regional consulting partner.

Another strong example is a mid 6 figure account expansion deal that was signed with a US based private equity firm. This company was previously using a manual process for over 130 funds globally. They already had experience with the Workiva platform having used our S1 solution when they went public. Their experience with us gave them the confidence that they could both automate and streamline the reporting process for fund reporting. This deal was a co sell and will be implemented by a regional consulting partner.

I’ll now turn to governance risk and compliance. Companies operate amid constantly shifting risk and compliance demands and heightened stakeholder scrutiny. And as they navigate new regulatory frameworks, geopolitical uncertainties and emerging challenges like fast evolving AI governance, they increasingly turn to our GRC solutions, fueling ongoing demand. Here are a couple of compelling GRC wins in Q2. First, a top 20 U.

S. Bank signed a mid 6 figure account expansion deal for controls management, compliance management and policies and procedures. This bank started on the Workiva platform eighteen months ago with the purchase of sustainability and financial reporting. The value of our platform was clear and it was a key differentiator in this competitive win. This deal is a co sell and will be implemented by a regional consulting partner.

And second, we signed a multi 6 figure account expansion deal for audit and controls management with The UK member firm of a big four partner. This partnership leverages the Workiva platform as a managed service to power the firm’s controls as a service offering that provides integrated GRC solutions to its clients. This deal underscores Workiva’s strength in providing the platform that drives the service lines of our partners. Delivery through a managed service channel provides Workiva expanded market reach and lower distribution costs. And it’s also a great experience for the end client as big four firms convert our platform into a full service outcome based solution.

I’ll turn now to sustainability where we saw a dynamic market throughout the quarter influenced by shifting political policies, proposed regulatory changes and softer demand in certain segments. At Workiva, we did observe a moderation in demand within our corporate account segment across both The U. S. And Europe. While the strong momentum we saw in the latter half of 2024 has tapered some, sustainability continues to drive both new logo wins and account expansion.

In these deals, continue to be many buying drivers, including business performance, managing stakeholder expectations and yes, regulations such as the CSRD, ISSB and the State of California Climate Disclosure Rule. I do want to make it clear that while sustainability remains a strategic part of our business, it is less than 15% of our total revenue. Also of note, the demand risks in this changing market and the weighted contribution of the solution on our bookings have already been factored into the updated revenue guidance we are providing today. We remain confident in the long durable demand of this market, which is supported by the deals that we continue to win. Here are three notable sustainability wins for the quarter.

Jill Clint, Chief Financial Officer, Workiva: First, a top five U. S. Bank signed a 6 figure account expansion deal for sustainability reporting and CSRD. This Fortune 100 customer had been doing voluntary sustainability reporting using Workiva for the past three years. This program, which is transformed into a centralized enterprise wide reporting framework, now reports into the office of the CFO.

Our value based discussions and strong partner alliances led to their expansion on Workiva’s platform for more mature, connected sustainability reporting program that is prepared for CSRD compliance. This deal was a co sell and will be delivered by a big four firm. Second, a top five global investment firm signed a mid 6 figure expansion deal with the addition of sustainability reporting and fund reporting to solve an array of requirements including fund level ESG requirements and multiple country ESG disclosures. This deal underscores the importance of

Julie Isco, Chief Executive Officer, Workiva: combining sustainability and financial information in one reporting platform. This customer was previously outsourcing all of their financial and regulatory reporting requirements for their 300 funds and they trusted Workiva to bring the reporting process in house, drive efficiency and save them money. This deal was a co sell and will be delivered by a big four firm. And third, a European multinational manufacturing company signed a 6 figure sustainability reporting and sustainability assurance deal as part of their CSRD readiness journey. Having previously used Workiva for annual reporting, this customer was looking to replace their manual inefficient sustainability reporting process with a more automated and integrated platform that allows them to adapt to changing regulations and respond to increased reporting demands from stakeholders.

This deal was a co sell and will be delivered by a big four firm. Finally, I’d like to share an important leadership update. After seventeen years with Workiva, Jill Clint will be stepping down from her role as Executive Vice President and Chief Financial Officer. Throughout her tenure, Jill has played foundational role in shaping Workiva into the company we are today. From our early days as a startup to our milestone of reaching $800,000,000 in revenue, she has been a steady, trusted leader and partner through every phase of growth.

Her impact will be felt well beyond her time here. I’m deeply grateful to Jill for the contribution she has made to Workiva and to our leadership team. She has our full support in this transition and our warmest wishes as she looks ahead to what’s next. Jill will continue to serve as CFO through December 2025 as we conduct a comprehensive search for our next CFO. In closing, I’d like to thank all of our dedicated employees for their focused execution this quarter, driving better business outcomes for our customers through transparency and accountability.

And with that, I’ll now turn the call over to Jill to walk you through our financial results and 2025 guidance in more detail. Over to you, Jill.

Jill Clint, Chief Financial Officer, Workiva: Thank you, Julie. I appreciate the kind words. My journey at Workiva has simply been extraordinary. From joining this company as one of the first 10 employees of a start up to crossing any number of growth milestones over the past seventeen years. I am thankful for the experience, and I am incredibly proud of what we have built.

It has been such a privilege to work with the entire team of passionate, hardworking, and dedicated employees at Workiva. I also want to thank all of you, our investment community, and in particular, our shareholders, for your continued support of Workiva. Moving on to our results. I will begin by providing an overview of the financials and key metric highlights for the 2025. I will then provide guidance for Q3 and the full year 2025.

As Julie discussed, we had a strong Q2, generating $215,000,000 of total revenue in the second quarter, up 21% over Q2 twenty twenty four and beating the high end of our revenue guidance by $5,000,000 There was an approximately one point positive impact due to foreign currency fluctuations on revenue growth. Q2 subscription revenue was $198,000,000 up 23% from Q2 twenty twenty four. Both new customers and account expansions continue to contribute to our solid revenue growth, with new customers added in the last twelve months accounting for 41% of the increase in Q2 subscription revenue. Q2 professional services revenue was $17,000,000 flat versus Q2 twenty twenty four, with the decline in setup and consulting services offset by higher XBRL services. Our non GAAP operating margin for the quarter was 3.8%.

This outperformance relative to our guidance was driven by stronger than expected top line results and our ongoing efforts to enhance operational leverage across the business. I’ll now move on to our performance metrics for the quarter. We had 6,467 customers at the end of Q2 twenty twenty five, a growth of three twenty customers from Q2 twenty twenty four. Our gross retention rate was 97%, exceeding our 96% internal target. And our net retention rate was 114% for the quarter versus 109% in Q2 twenty twenty four.

Similar to revenue growth, there was an approximately one point positive impact on NRR due to foreign currency fluctuations. During the quarter, 71% of our subscription revenue was generated from customers with multiple solutions. This is up from the 67% we achieved in Q2 twenty twenty four. Growth in our large contract customer metrics also reflected strong momentum. As of the end of the quarter, we had 2,241 contracts valued at over $100,000 per year, up 27% from Q2 the prior year.

The number of contracts valued at over $300,000 totaled four eighty eight, up 37% from Q2 twenty twenty four and the number of contracts valued over $500,000 totaled two zero eight, up 35% from Q2 twenty twenty four. Moving on to the balance sheet. As of 06/30/2025, cash, cash equivalents, and marketable securities were $814,000,000 an increase of $47,000,000 over the prior quarter end. In Q2, we used a portion of our generated cash to repurchase 132,000 shares of our Class A common stock for $10,000,000 This was done under the share repurchase program approved by the Board in July 2024. As of the end of the quarter, we had 50,000,000 remaining of the original $100,000,000 authorization, which we will continue to deploy periodically in order to help manage dilution.

As of 06/30/2025, we expect $668,000,000 in remaining performance obligations to be recognized over the next twelve months. This is an increase of 23% versus the prior year. This growth includes approximately two points positive improvement due to foreign currency fluctuations. Turning to our outlook for Q3 and full year 2025. As Julie noted, we remain firmly committed to driving profitable growth.

The increase in our full year revenue guidance reflects our Q2 revenue beat and carefully factors in our assessment of market and demand risks, including that of our sustainability solution. The upward revision to our Q3 and full year 2025 operating margin guide reflects a continued focus on driving leverage at scale across the business and our planned progress towards achieving our 2027 margin targets. For the 2025, we expect total revenue to range from $218,000,000 to $220,000,000 We expect services revenue will be down compared to Q3 twenty twenty four. We expect non GAAP operating margin to be in the range of 7% to 8%. For the full year 2025, we are increasing total revenue guidance to range from $870,000,000 to $873,000,000 This increase takes into account the Q2 revenue beat.

Similar to 2024, we expect total services revenue will be down year over year as we move low margin services to our partners. We continue to expect subscription revenue growth will be approximately 20%. We now expect our non GAAP operating margin will range from 7% to 7.5%. This 200 basis point improvement reflects our ongoing commitment to drive operating leverage in the business. We now expect 2025 free cash flow margin to be approximately 10.5%.

We continue to operate our business with our 2027 and 2030 targets in mind, improving productivity and operating leverage as we execute on our long term profitable growth strategy. Thank you all for joining the call today. We are now ready to take your questions. Operator, please open the line for Q and A.

Gary, Conference Call Operator: We will now begin the question and answer session. Our first question today is from Alex Sklar with Raymond James. Please go ahead.

Jill Clint, Chief Financial Officer, Workiva: Great. Thank you.

Alex Sklar, Analyst, Raymond James: First question maybe for you, Jill. I just had a two part question on the revenue outlook. First, are you seeing any contribution from capital markets picking back up and anything that you incrementally embedded into the 2025 outlook from that? And then second, I appreciate all the call outs on FX. Did FX impact the guide at all as well?

Jill Clint, Chief Financial Officer, Workiva: Thanks for the question. So for capital markets, we continue to see steady revenue from capital markets in Q2 similar to in the past. It’s one that we’re watching really closely given the activity that we’ve seen. And Julie, you want to dive in after I answer the second part of Alex’s question, we’d love to hear from you too. But we have continued to include capital markets at a steady rate in the future, and so it could be potential upside if there’s a heavier return to activity in the second half.

Related to FX, we took a look at FX and it is a part of our risk adjusted model. We took into consideration potential changes in the through the rest of the year. But I would say that we aren’t expecting large changes and we don’t expect it to impact our ability to reach those goals considering that we have risk adjusted the guide. Julie, was there anything else you wanted to reply related to capital markets? Sure, I mean, you covered the important element, which is that we’ve not baked anything, any come back into the guide for capital markets, but we have seen some increased activity in the past few months and supported by some of the recent and upcoming well publicized IPOs, in fact, a great story for Workiva, we had the IPO for Figma and also Shoulder Innovations, both of which went public today.

But that detectable increase in the market activity, admittedly, comes off a very low comparable, so we are seeing some growth here, but nothing like we saw in the other more active periods. But continue, as Jill says, to think about cap markets as upside and not considered any cap markets return yet in the guide.

Alex Sklar, Analyst, Raymond James: Great. Congrats cap on markets wins. Maybe Julie, one for you and maybe it’s a two parter with Jill too. But some of the financial reporting success you called out this quarter, can you talk about some of the SEC reporting bundles that you’ve been working on in market in terms of kind of driving upsell within that base? And

Kyle Aberastrian, Analyst, BMO Capital Markets: did

Alex Sklar, Analyst, Raymond James: that have any impact on kind of the strong NRR in the quarter? Thanks.

Jill Clint, Chief Financial Officer, Workiva: Sure. I’ll let you know about our the way we’ve been approaching the market. We’re moving towards that good, better, best model. So we bring in some additional capabilities onto our cornerstone SEC reporting or financial reporting, and we add additional capabilities and features and enhancements. And that’s how we’re approaching the market to get additional revenue from the customer and get additional value to the customer as well.

Jill, if you want to comment on the NRR, please do. Sure. So we did see a nice uptick in NRR during the quarter. We had a few of our metrics reflected the nice upside that we had related to upsells into our existing base with nearing 60% of our revenue growth S and S revenue growth from the quarter came from existing customers. And we continue to expand on the number of customers with multiple solutions.

And so that participation and that movement will continue to be an important one for us. And SEC is a great way for us to a great place for us to start with those upsells because those are some of our oldest customers and we have great opportunity to go in and talk to them about what else the platform can do for them.

Alex Sklar, Analyst, Raymond James: All right, great. Thank you both.

Gary, Conference Call Operator: The next question is from Rob Oliver with Baird. Please go ahead.

Rob Oliver, Analyst, Baird: Great. Good afternoon. Thanks for taking my questions. First, Jill, I just wanted to say it’s been a pleasure working with you and I wish you all the best. And you’re not done with me yet because one of my questions is for you, but I’ll start with Julie.

Julie, there’s a lot of concern in the market among companies in our coverage list and the broader software universe about the potential erosion from generative AI on seat based models. And you guys do not have a seat based model. You have a solutions based model. And I’m wondering, particularly as you’re showing really nice go to market motion and success, say for example in the financial services vertical. I’m wondering if that solutions based model is being viewed as attractive by your customers and a potential asset for you guys in your go to market motion at this time?

And then I had a quick follow-up.

Jill Clint, Chief Financial Officer, Workiva: Sure. Thank you, Rob, for highlighting our pricing mechanisms and models. And it certainly is, we put it in place because we wanted to let customers use the platform and not feel constrained by number of seats. So, we did go to that solution based licensing model several years ago and it has served us well for that reason, unconstrained use of the platform. However, we do have value metrics for each of the solutions, again broad based demand across the portfolio and each area has different value metrics that customers leverage and pay accordingly.

So it has served us well and it certainly will serve us well in the AI category as well. Certainly not seat based and we continue to leverage that. And with AI, we’ll be adding that in at some point. It’s only in premium pricing today, but yes, serving us well with customers. Thank you for highlighting.

Rob Oliver, Analyst, Baird: Great. Okay. Thanks. Good to hear. And then, Jill, just one for you on the improved operating margin outlook for the remainder of the year and the improved free cash flow margin.

I know you touched on it in your prepared remarks, but would love to hear from you where you have been able to find additional margin and opportunities for additional margin as investors look towards your reiteration of the long term targets and the kind of margin ramp that’s implicit within that. Thank you very much.

Jill Clint, Chief Financial Officer, Workiva: Yes. Thanks, Rob, and thanks for the kind words. I appreciate it. I have enjoyed working with you as well. As far as our improved margin, we’re very pleased with the results that we have for Q2 for the guidance that we’re providing.

It’s a result of continued focus on execution across the business and focusing on productivity and ways that we can work much work smarter. And it really is not one thing and not one part of the business, but an overall focus by the team to be better and execute at a higher level. And we’re starting to see the results of some of the things that we’ve been doing And you’ll see us continue to focus on that as a movement as we continue to show the results and execute on our strategy.

Rob Oliver, Analyst, Baird: Great. Thank you all very much.

Gary, Conference Call Operator: The next question is from Steve Enders with Citi. Please go ahead.

Steve Enders, Analyst, Citi: Okay, great. Thanks for taking the questions this afternoon and congrats again on working with you and looking forward to seeing what things go from here. I guess I want to start on the sustainability portfolio and I guess get a little more detail on what it is that you are seeing in the marketplace. I guess for one, sounds like it’s being accounted for in the guide or some of the weaknesses, but maybe just how does that manifest or what is that or how does that kind of playing out in the numbers? Then I guess secondarily, just how are you kind of viewing the pipeline or the opportunity from here and maybe what that looks like over the next few years?

Jill Clint, Chief Financial Officer, Workiva: Sure, thank you. Thanks for question. Not unexpected, given the political and regulatory landscape, nor was it unexpected for us in terms of what we saw. As I highlighted in the prepared remarks, we did observe a moderation in demand in Q2 within our corporate account segment across both US and Europe. But while the strong momentum we saw really in the latter half of the year, that’s what we tapered off from and I think that’s really important to recognize.

And while it has tapered off from those prior quarters, strong quarters, it still continues to drive growth for us, both new logo wins and account expansions. And I do think you asked about some numbers and impact, probably worth reminding again, sustainability is only 20% of our TAM and it’s less than 15% of our revenue. So, current demand, yes, we’re seeing that slowing primarily in the corporate segment, but it’s been factored, as he said, into updated revenue guidance that we’re providing today. So that’s really the gist of it. But we remain optimistic on the long durable demand of the market.

We’re seeing deals come in with, well I should say, with the S regulation, but beyond that too, science based targets have been set. There are now up to

Gary, Conference Call Operator: eight

Jill Clint, Chief Financial Officer, Workiva: eighty eighty thousand five five companies, 100 companies, excuse me, setting science based target initiatives. Organizations are just looking to better manage risk and address their stakeholder expectations, so we are seeing market demand beyond the regulation. We just wanted to highlight that given the strong quarters that we had, and we had multiple strong quarters last year, yes, the growth has moderated. So that’s essentially what it is. We still, of course, believe this is a long, durable demand market.

Steve Enders, Analyst, Citi: Okay, that makes sense. That’s good to hear. Then just on the free cash flow guide, I guess good to see, you know, a cut or the even margin raise, but I guess I would have expected maybe free cash flow to show maybe a similar pace of expansion in the updated guide for this year. If any factors that we should be taking into account there or maybe what’s different in the assumptions on the free cash flow side versus the even margin side?

Jill Clint, Chief Financial Officer, Workiva: Our free cash flow is a really complex metric for us, because it does have a lot of factors related to the timing of cash inflows and cash outflows in addition to just the impacts from the margin guide that we provided. And so it can have some amount of fluctuations aside from that. But I think that similar to what we talked about in our last earnings call, When we talk about a risk adjusted guide, this is one of the areas where it shows up. There is more risk and more uncertainty the further out from today that we get. And the free cash flow margin that we provided is really risk adjusted metric that we believe properly reflects our business through the end of the year.

And with the timing differences and some of that complexity rolled into it, we feel very good about that number.

Steve Enders, Analyst, Citi: Okay, perfect. Thanks for taking the questions.

Gary, Conference Call Operator: The next question is from Teri Tillman with Truist Securities. Please go ahead.

Jill Clint, Chief Financial Officer, Workiva: Hi, this is Dominique Monadsala on for Teri. Thanks for taking my questions. So just looking at the mandate for CFO Act agencies to modernize the financial system using approved marketplace vendors, Have you seen any early RFP activity from these agencies? And how significant could that opportunity become over the back half of the year or in the long term? Dominique, can you actually repeat the question?

Sorry, it cut out a little bit for us. Yeah, sure. No problem. So, just referring back to that CFO Act where agencies have to modernize the financial systems using the approved Marketplace vendors, just wondering if you’re seeing any early RFP activity from these agencies and how that opportunity can look in the back half or in the long term. Sure.

We have been able to get into conversations and we are the only SaaS platform in the marketplace that has a platform to cover the integrated reporting and assurance and DRC as we do. So, we’re seeing early signs of, I’ll say we’re having good discussions, so no comments on the actual uptick at this point. But our platform does provide an opportunity to go in and provide services to the government who’s looking primarily to transform and automate, become efficient, accountable, and so forth. So, it’s a good opportunity for Workiva. Got it, thanks.

And then, just as you evaluate growth opportunities in the current environment, how are you thinking about M and A? Just wanted to know if there are any specific product areas like Jenny I, ESG or vertical solutions where you may be more inclined to buy versus build? Sure. As I always say, we scour the earth essentially to look for all opportunities, whether it’s a gap to close on the platform, whether it’s technology to level up all solutions, adjacencies, etcetera. So, no preconceived notions, but we’re continually looking to find potential partners and M and A that can really strengthen the platform and either go after our large end address TAM in a faster way or potentially expand that TAM.

Great, thank you.

Gary, Conference Call Operator: The next question is from Andrew DeGasperi with BNP Paribas. Please go ahead.

Andrew DeGasperi, Analyst, BNP Paribas: Thanks for taking my question. Julie, maybe earlier in the prepared remarks, you mentioned some big wins. And I think financial services or a large bank was one you mentioned tied to the Federal Reserve. Can you maybe provide a little context on that? Like, is this something that potentially could be a driver in the near term for that cohort of customers?

Jill Clint, Chief Financial Officer, Workiva: Financial services regulations have been drivers for years, and we are going deeper into the market. While our focus has been there, we’re going to continue to go in even more extensively. So, yes, absolutely, we’re continuing to increase the use cases that we have under the financial services area, regulatory certainly, and we’re going to continue to focus on banks and the risk regulations and investments and fund reporting. So you will see more of that. Also have insurance market with 20 or so regulations that we sell to as well.

Andrew DeGasperi, Analyst, BNP Paribas: That’s helpful. And then, Jill, by the way, also a pleasure to work with you and wishing you all the best going forward. I just had a question in terms of what you said earlier in terms of the margin. And then what I’m trying to understand is, are you making any changes to the sales and marketing investments assumptions that you had for the back half? Is that some of the driver behind the outperformance?

Jill Clint, Chief Financial Officer, Workiva: So, would say that we’re constantly looking at our sales and marketing resources and reallocating based on current business. But there wasn’t any large scale change to that investment. And what you’ll see from us is a lot of what you’ve seen in the past, which is being thoughtful around how we built the business, thoughtful around how we approach our markets. And sometimes that does include adjustments in territories and adjustments in teams. And you’ve seen us do that across the sales team as it is.

One of those examples would be moving towards a hunter farmer model in certain areas this year. And so we will continue to make those kind of changes in order to focus on profitability and efficiency throughout the business. And so within sales and marketing, those aren’t held aside. We’ll also be trying to make those improvements and find efficiencies and better leverage for the resources within our sales and marketing teams. And that’s definitely a part of the improvement.

But something you can always look towards is our 2027 targets, which we reiterated on the call prepared remarks and we are still focused on executing and progressing on our goals with those twenty twenty seven margin targets in mind, inclusive of the split between the different areas of the business.

Andrew DeGasperi, Analyst, BNP Paribas: Understood. Thank you.

Jill Clint, Chief Financial Officer, Workiva: Yes. Thanks, Andrew. Thank you.

Gary, Conference Call Operator: The next question is from Jake Roberge with William Blair. Please go ahead.

Jake Roberge, Analyst, William Blair: Yeah, thanks for taking the questions. And Jill, wish you all the best moving forward. It’s been great working with you. Julie, just on the macro, I know you referenced some pressure on demand for your sustainability suite, but just given the solid results here, did you see any other changes or improvements across the broader base over the last few months? Or was it fairly consistent with the trends that you called out last quarter?

Jill Clint, Chief Financial Officer, Workiva: I appreciate the question. The macro is on top of minds of most of us running SaaS companies these days, and the reality is we didn’t really see much change from Q1 to Q2. Overall market conditions remained fairly constant and we saw some uncertainty maybe across all sectors, and very similar to what we saw in Q1. Now the deal cycle elongation, which is expected in an uncertain market. Some cases, saw, even when we were selected as a vendor, would say we saw it’s taking more time to get some deals over the line.

And you see some companies just being more thoughtful in the timing of their spend for some of these transformational purchases. But we still continue to see some signature deals come in and have some great wins, some of which I did share in the prepared remarks. But I think overall demand has moderated for us compared to the momentum that we saw in those stellar bookings quarters we had in 2024. But all of that’s been factored into our latest guide, as Jill has mentioned. And we’ve raised the guide in our subscription revenue for 2025 to reflect the beat.

But really, in direct answer to your question, very consistent from this quarter from last.

Jake Roberge, Analyst, William Blair: Okay, that’s helpful. And then just to double click on the sustainability front, you referenced the tamper demand in the corporate segment, but can you talk about what you’re hearing from some of the larger enterprise in Wave one CSRD reporters, and if that kind of is different versus the corporate segment, and if there’s been any change on that front over the last few months?

Jill Clint, Chief Financial Officer, Workiva: Sure, we talk about our corporate segment, the mid market primarily. We have our sales categorized into corporate, strategic and major accounts. And we did see the softening there around regulation, some delays and so forth. But that’s really where it is. Our market is primarily upmarket, that’s where our strong market is.

And the regulation with CSRD for the most part remains in place there for the large companies in the wave one in Europe and those that want to play in a global ecosystem and supply chain, continue on with their demand and so forth. And as I said, it’s beyond regulation, it’s stakeholders and risk management and so forth. So yes, we did call out primarily where we saw the tapering and off a bit and a softening I’d say for that corporate market or mid market.

Jake Roberge, Analyst, William Blair: That’s helpful. Thanks for taking the questions.

Gary, Conference Call Operator: The next question is from Adam Hotchkiss with Goldman Sachs. Please go ahead.

Katie White, Senior Director of Investor Relations, Workiva0: Great. Thanks so much for taking the questions. I would like to ask an earlier question different way, Julie. I think you mentioned how sustainability was a bit stronger in 2024 and that things have moderated. But subscription revenue here has accelerated.

I think it’s your highest growth quarter in the last number of quarters. Forward looking metrics like billings have accelerated and CRPO continues to be strong. And so could you maybe marry some of those moderation comments, in particular around sustainability and the broader market with the acceleration, broad based acceleration we’re seeing in the business ex sustainability. And what do you think is driving that and how sustainable you think that is?

Jill Clint, Chief Financial Officer, Workiva: Our guide of course just took into account the comments I already made just a moment ago, which is just overall the risks and that’s from the uncertain macro and what we’re seeing overall and broad based across the portfolio. But we also adjusted for risk there on the sustainability because again of the regulatory and political environment. But we had strong revenue this quarter and that comes from our subscription revenues generated from customers with multiple solutions, the platform is resonating, know, our partner ecosystem and so forth, just performing there. So, we do have a very resilient platform, and we’re selling, it’s again broad based, we have a large portfolio of solutions that we offer in the market, so that’s really kind of where the revenue comes from. And then of course, we’re a subscription SaaS company and inherent in that business model is that in any given quarter we’ve got deals booked from prior quarters as well, so that’s where subscription revenue comes from as well.

But it really, again, I’ll highlight again, less than 15% of our revenue is from sustainability. We have broad based platform and it’s resonating in the market and again, strong growth. But we of course, are going to take a risk adjusted approach as we look at the guide.

Katie White, Senior Director of Investor Relations, Workiva0: Okay, that’s really helpful, thank you. And then just on the, you know, the AI question another way, how do you think about, and especially given how things have evolved recently, how were Peeva’s vote against generative AI technologies writ large and some of these agents that allow companies to utilize their operational data in different ways. Could you just maybe speak to the moat that Workiva has built around AI and how you think about the installation of your reporting product set and workflow product versus some of these newer upstart technologies?

Jill Clint, Chief Financial Officer, Workiva: Sure. We’ve spent a decade and a half building trusted relationships with our customers. And we have the most innovative technology and we really focus on the customer data. That’s very important to customers that we care for and it’s important to us. But of course, we are bringing in the latest technology and data.

When it comes to AI, data is a differentiator. And we happen to have data that we can leverage in these AI capabilities, but we’re bringing the capabilities and the technologies onto the platform to ensure that we bring additional value to the customers and differentiate. So we’re going to continue to invest in AI across the platform. We bring it into our platform in our controlled secure auditable environment, give customers the comfort and the knowledge that their data remains within the platform, not used to train models and so forth, but we’re helping them with of course speed and efficiency, helping them to respond quickly to risk and volatility with greater focus. Seeing some ROIs from our customer that show measurable impact, and they’re leveraging those capabilities on the platform.

So, I do want to emphasize, we take it very seriously that we have trusted relationships with our customers, but we will be committed to bringing value to the customers using AI.

Katie White, Senior Director of Investor Relations, Workiva0: Okay. Thank you very much, Julie and Jill. All the best wishes for you. Great working with you.

Jill Clint, Chief Financial Officer, Workiva: Thank you. Thanks so much.

Gary, Conference Call Operator: The next question is from Daniel Jester with BMO Capital Markets. Please go ahead.

Kyle Aberastrian, Analyst, BMO Capital Markets: Hi, good afternoon. This is Kyle Aberastrian on for Daniel Jester. Thanks for taking the questions. It looks like a strong quarter for customer growth, especially the larger businesses. Could you help us unpack where in the product portfolio the strength is coming from?

And then more generally, what you’re seeing in the competitive landscape?

Jill Clint, Chief Financial Officer, Workiva: I caught the part of the you want to talk about the product portfolio. Can you repeat the initial part of the question prior to the competitive landscape?

Kyle Aberastrian, Analyst, BMO Capital Markets: Yes, sure. So it looks like a strong quarter for customer growth, especially for larger businesses. Could you help us unpack where in the product portfolio the strength is coming from and then more generally what you’re seeing in the competitive landscape?

Jill Clint, Chief Financial Officer, Workiva: We continue to see broad based demand across the portfolio. That’s something that’s been consistent quarter after quarter. Platform, one of the strengths of the platform, very resilient and for the most part the demand continues across all solutions. So it really depends on where the customer is, if they’re doing transformation, if they’re in financial services, whether they’re focused on sustainability. It’s not one area or another that we’re seeing deep trends on.

It really is broad based across the portfolio. In terms of

Kyle Aberastrian, Analyst, BMO Capital Markets: the

Jill Clint, Chief Financial Officer, Workiva: competition, we continue to have competition, but it is point solution primarily, not a platform as we have for all the capabilities that we have on one platform, but also there’s a lot of legacy technology there that we are competing against. So status quo, legacy, and point solutions are primarily the competitors that we face, but our differentiation comes in very strong with a broad based platform, also connection to all the partners in our ecosystem. So that’s really how we win. High value, fit for purpose solutions, but it’s on the platform connected, becoming more open and intelligent platform.

Kyle Aberastrian, Analyst, BMO Capital Markets: Got it. And then can you just discuss how you’re thinking about investment plans in the businesses headcount expectations for the remainder of 2025 and into 2026? Thank you.

Jill Clint, Chief Financial Officer, Workiva: Thanks, Kai. So we will continue to focus on productivity and leverage with our existing resources. We of course will continue to make investment decisions based on the potential outcomes from those investments. And that will in some cases lead to hiring in certain areas. But really the focus that we have as we execute on our mid term, long term margin goals is just ensuring that we have profitable growth and that we’re executing on our strategy in a way that makes sense with our margin goals in mind.

Gary, Conference Call Operator: The next question is from Ryan Krueger with Wolfe Research. Please go ahead.

Kyle Aberastrian, Analyst, BMO Capital Markets: Hey guys, thanks for squeezing me in here and congrats on a solid quarter. I just want to touch on retention quickly. It was incredibly strong this quarter even excluding FX. So can you provide some additional color on maybe what drove that strength and help us think about the mix of pricing versus pure expansion contribution there? And then how should we think about retention the rest of this year?

I know you’ve historically talked about over 110% being positive, but is this potentially an inflection point just given the momentum that you’re seeing?

Jill Clint, Chief Financial Officer, Workiva: Yes. So exactly right, Ryan. And thanks for the kind words on the quarter. So when we think about NRR, this was a high point for us certainly and there was the impact from currency. But overall, what we were seeing here was really about the upside of selling into our existing base.

At any point in time, we have been focusing more on price increase, but that’s not a large part of our generally. The majority of our uplift on NRR tends to be from the additional solutions sold into our base and that’s really where we focus when we think about NRR. And of course, we get the benefit of amazing gross retention as well and retaining our existing customers and contracts.

Kyle Aberastrian, Analyst, BMO Capital Markets: And then any way to maybe think about it for the rest of the year?

Jill Clint, Chief Financial Officer, Workiva: For the rest of the year, I would still say that that 110 plus is what we think of as a good result there. It can fluctuate because of currency. It can fluctuate, of course, because of the mix between sales into new customers versus the existing customer base. But 110 plus is a good result for us.

Kyle Aberastrian, Analyst, BMO Capital Markets: Perfect. Thank you, guys. Appreciate it.

Jill Clint, Chief Financial Officer, Workiva: Thanks.

Gary, Conference Call Operator: This concludes our question and answer session and the conference has also now concluded. Thank you for attending today’s presentation. You may now disconnect.

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