Workday, Inc.

Welcome to Workday's first quarter fiscal year 2022 earnings call. At this time, all participants are in a listen-only mode. We will conduct a question and answer session towards the end of the call. I would now hand it over to Justin Furby, Vice President of Investor Relations. Thank you. You may begin.

Thank you, Operator. Welcome to Workday's first quarter fiscal 2022 earnings conference call. On the call, we have Anil Bushri and Shano Fernandez, our co-CEOs, Robin Sisco, our President and CFO, and Pete Schlampp, our Executive Vice President of Product Development. Following prepared remarks, we will take questions. Our press release was issued after close of market and is posted on our website where this call is being simultaneously webcast. Before we get started, we want to emphasize that some of our statements on this call, particularly our guidance, are based on the information we have as of today and include forward-looking statements regarding our financial results, applications, customer demand, operations, and other matters. These statements are subject to risks, uncertainties, and assumptions, including those related to the impacts of the ongoing COVID-19 pandemic on our business and global economic conditions. Please refer to the press release and the risk factors in documents we file with the Securities and Exchange Commission, including our 2021 Annual Report on Form 10-K and most recent quarterly report on Form 10-Q for additional information on risks, uncertainties, and assumptions that may cause actual results to differ materially from those set forth in such statements. In addition, during today's call, we will discuss non-GAAP financial measures, which we believe are useful as supplemental measures of workday's performance. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from GAAP results. You can find additional disclosures regarding these non-GAAP measures, including reconciliations with comparable GAAP results, in our earnings press release and on the investor relations page of our website. The webcast replay of this call will be available for the next 90 days on our company website under the investor relations link. Also, the customers page of our website includes a list of selected customers and is updated monthly. Our second quarter quiet period begins on July 16, 2021. Unless otherwise stated, all financial comparisons in this call will be to our results for the comparable period of our fiscal 2021. With that, I will hand the call over to Anil.

Thank you, Justin, and good afternoon, everyone. Thank you for joining us today for our first quarter fiscal year 22 earnings call. Before we jump into our quarterly results, first, a huge congratulations to Workday Ambassador and my good friend, Phil Mickelson, on winning the PGA Championship over the weekend. an amazing accomplishment and proving once again that in addition to being a great person, Phil is one of the most talented golfers of all time. I'm pleased to report that Workday had a strong quarter, starting the year with significant momentum and positioning us well for a great fiscal year 22. In Q1, we saw an increase in demand across all product areas while delivering strong non-GAAP operating margins of 25%, showing the strength inherent in our underlying business model. Our results support the acceleration of digital transformations across HR and finance, and Robin will share more shortly on how we plan to invest behind this opportunity. Let me share some highlights starting with Workday HCM. We continue to be the market leader with our differentiated suite of products and continued innovation. We're seeing an increase in demand as more and more organizations prioritize transition of HCM systems to cloud to deliver a world-class employee experience. In Q1, we welcomed ASM Global, Las Vegas Sands Corp., Mattel, Five Below Inc., and Cost Plus World Market to the Workday family, along with many other new HCM customers. Even with all the sales momentum, we continue to have over 70% of our HCM customers in production, with notable go-lives in Q1, including Fieldman AG, University of Sydney, and Macquarie University, to name a few. Turning to Workday Financial Management, we saw momentum build in Q1 as companies increasingly prioritized digitalization within the Office of the CFO. In addition to an acceleration in core financial bookings, we also saw strength across the portfolio with offerings such as Workday Adaptive Planning, Spend Management, including Workday Strategic Sourcing, formerly known as Scout, and our Enterprise Finance Solutions. New customers in Q1 included Los Angeles Department of Water and Power, SACS, St. Francis Health System, Inc., with add-on wins at FHI and Werner Enterprises. Our focus on industry solutions was also a key contributor to our success during the quarter, where our PSA solution was a key driver to a broader HR and FINS platform win in Q1 at accounting firm RSMUS. And our accounting center solution was part of a FINS first win at National Farmers Union Mutual Insurance. Our strong position continues to get recognized by the market. For the fifth year in a row, Workday was named a leader in the Gartner Magic Quadrant for Cloud Core financial management suites for midsize, large, and global enterprise last published on May 1st of this year. Taking a step back, we continue to focus on delivering a global solution that enables business leaders to plan, execute, and analyze all in one system. And in this rapidly changing world, our value proposition only continues to grow as we make advances on the innovation front. In Q1, we delivered our latest feature release, Workday 2021 R1, with advancements across all product areas, including broadening the capabilities of Workday Extend and greater functionality in spend and supplier management. We also continued our investment in a world-class user experience, a smarter and more personalized search and Workday people experience, as well as extended capabilities in natural workspaces outside of Workday, such as Slack and Microsoft Teams. And to further enable customers in optimizing the future of their employee experience, this ever-changing world, I'm proud to announce that we closed on the acquisition of Pecan, now a Workday company. China will add more color on Pecan in a few minutes, but we couldn't be more excited by the opportunity we see with the Pecan offerings and are excited to welcome the Pecan team to Workday. In our history, innovation and empathy have always led to greater customer satisfaction which is at the heart of everything we do at Workday. I continue to be so grateful to our teams who have all supported customers in entirely new ways to ensure their success during these challenging times. Underscoring this dedication, I'm pleased to announce our latest customer satisfaction score of 97%. The survey is particularly meaningful as it provides us feedback from our names, support contacts, those who are closest to engaging with the Workday experience on a daily basis. Switching to the people front, as you all know, we believe a key part of our success continues to be our vibrant company culture, which allows us to maintain high levels of employee satisfaction and greatly helps us attract and retain talent across all levels of the company. As we look ahead, we see a tremendous opportunity in front of us to partner with more organizations across all industries and serve as the backbone of their digital transformation efforts in this changing world. And foundational to lowering on that opportunity be a motivated and growing group of employees. So as we move forward on this growth path, we plan to increase our global workforce by more than 20% or 2,500 new hires in the fiscal year 2022. In doing so, we'll have an even stronger foundation to scale and innovate on our path to $10 billion. This quarter was a strong start to our fiscal year and set the stage for acceleration in our business. As I look ahead, my optimism for Workday's future couldn't be higher. We have a great team in place and a significant global opportunity in front of us as companies continue to embark on their HR and finance transformation journeys. With that, I'll turn it over to my good friend and co-CEO, Chano Fernandez. Over to you, Chano. Thank you, Anil.