Workiva Inc. Class A

Good afternoon, ladies and gentlemen. Welcome to Workiva's third quarter 2025 earnings call. My name is Chuck, and I'll be your host operator on this call. After the prepared remarks, we will conduct a question and answer session. Instructions will be provided at that time. Please note that this call is being recorded on November 5th, 2025 at 5 p.m. Eastern time. I would now like to turn the meeting over to your host for today's call, Ms. Katie White, Senior Director of Investor Relations at Workiva, please go ahead.

Good afternoon and thank you for joining Workiva's Q3 2025 conference call. During today's call, we will review our third quarter results and discuss our guidance for the fourth 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 up the call for a Q&A session where we will be joined by Mike Rost, 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 fourth 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. Rekiva 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-K 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.

Thank you, Katie, and thank you all for joining us today. In Q3 of 2025, we delivered another quarter of strong financial performance, powered by the continued demand for our broad portfolio of solutions and our AI-powered platform. We beat the high end of our revenue guidance with 23% growth in subscription revenue and 21% growth in total revenue. On a year-to-date basis, we've delivered 22% subscription growth and 20% total revenue growth. This performance underscores the resilience of our business and the focused execution by our team at Workiva and our partners. As a result of the Q3 revenue beat, we're increasing our full year 2025 revenue guidance. We continue to deliver value to the market because we focus on customer needs. Our customers need to trust the numbers they're disclosing. They need to provide transparency across their business, both financial and non-financial information. And yes, they must be accountable with assurance as a requirement every step of the way. So our customers are looking to us and our platform to solve their most challenging problems. This value we deliver to our customers is highlighted by the continued growth in our large contract cohorts. In Q3, the number of contracts valued over $100,000 increased 23%. Those over $300,000 increased 41%, and contracts valued over $500,000 increased 42%, all compared to Q3 of 2024. This large contract growth was driven by both additional solution sales within our existing customer base and the landing of larger new logo deals. At the same time, we delivered a non-gap operating margin of 12.7%. This is a 470 basis point beat on the high end of our guide. It's also an 860 basis point improvement compared to Q3 of 2024. With this margin beat, we're raising our full year 2025 non-gap operating margin guide by 200 basis points at the midpoint. These results reflect our continued focus on durable growth and meaningful margin improvement. They also demonstrate tangible progress toward our medium and our long-term operating margin targets. We believe that our disciplined execution and our operating rigor position us to deliver additional leverage over time. I'll move on now to provide some representative Q3 deals. These customer wins provide meaningful insight into our business. They highlight the breadth of our solution portfolio, the location and the types of customers that we're selling to, and the role that our partners play in the adoption and the success of our platform in the market. I'd like to start off with a few deals that demonstrate our continued success as a global platform company. First, a top five global pharmaceutical company signed a mid-six-figure two-solution account expansion deal for sustainability reporting and policy management. Already a 13-year loyal SEC reporting customer, they nearly tripled their spend with a platform expansion into the GRC and sustainability solution categories. This global organization invested in the Workiva platform to support their sustainability roadmap. The roadmap includes requirements across CSRD, ISSB, and other local requirements in some of the 100-plus countries in which they operate. The deal was sourced and it will be delivered by a Big Four firm. Second, a North American telecommunications and media company signed a mid-six-figure account expansion deal for four solutions. The deal included audit management, controls management, operational risk, and sustainability. This nine-year loyal SEC customer more than doubled their spend with this account expansion and now uses six solutions on the platform. There were several business drivers behind this deal. They included replacing multiple GRC solutions and consolidating on a single platform to drive efficiency and cost savings, enabling risk mitigation across sustainability and operations, and providing support for an integrated annual report, combining both financial and non-financial information. Workiva was the only solution evaluated that could address all three of these requirements on a single platform. The deal was sourced and will be implemented by a Big Four firm. And third, we closed a high six-figure expansion deal with a European-based energy services company. The deal covers six solutions, sustainability reporting, controls management, enterprise risk management, policy management, compliance, and operational risk management. The customer first adopted Workiva back in 2022 for ESEF reporting. It has since increased its annual spend more than eightfold, now exceeding $1 million in annual subscription revenue. This was a competitive win over multiple GRC solution providers and multiple sustainability reporting solutions. The deal was sourced and will be delivered by a Big Four firm. Our deal momentum extends beyond platform-wide wins. We continue to land and expand with the financial reporting category, which remains a durable growth area for us. A key financial reporting driver is our multi-entity reporting solution, purpose-built for multinational organizations managing complex global structures and operations. A strong Q3 example of a multi-entity reporting deal is a seven-figure expansion with a leading global oil and gas company. This customer more than doubled its spend and now leverages six Workiva solutions. As part of a multi-year financial transformation tied to ERP consolidation and an S4 HANA migration, Workiva will enable the modernization of their local statutory reporting across 300 legal entities. This deal was sourced and will be delivered by a regional consulting firm. Another example of our multi-entity reporting deal momentum is a mid-six-figure account expansion with a U.S.-based global manufacturing company who's been a Workiva customer for 14 years. The deal adds two financial reporting solutions, multi-entity reporting and regulated financial reporting, and it increases the customer's annual spend nearly fourfold. Both solutions replaced legacy manual processes previously managed through desktop tools. The deal was sourced and will be delivered by a regional consulting firm. Expansion deals aren't the only driver of financial reporting growth. A strong new logo win in Q3 was a four-solution deal with a European export credit corporation. The customer adopted Workiva for SEC reporting, ESEF reporting, bank regulatory reporting, and sustainability. They're pursuing two major initiatives, standardizing SEC and ESEF reporting on a single platform and preparing for CSRD compliance as a Wave 1 filer. Workiva was the only solution evaluated that could support their integrated reporting requirements across both sustainability and financial reporting. This deal was a co-sell and will be delivered by a Big Four firm. I'd like to move on now to one of our vertical specific solution categories, financial services, and I'll highlight just a few of our Q3 wins in this vertical. First, we secured a mid-six-figure new logo with one of Europe's top ten banks. The customer adopted five solutions – SEC reporting, ESEF reporting, sustainability reporting, multi-entity reporting, and bank regulatory reporting. The deal replaces multiple on-premise systems and manual spreadsheet-driven processes. Multiple Big Four and global consulting firms participated in the co-sell effort. Delivery is to be executed through several Workiva partners. Second, we closed a seven-figure new logo deal with a European fund services administrator. This was for fund reporting. This was a competitive win over the incumbent on-premise software solution. The customer selected Workiva for two key reasons. Our ability to scale reporting across 2,500 funds and our platform's clear differentiation from legacy technology. The deal was sourced and will be implemented by a big four firm. Turning to sustainability, demand remains steady as organizations respond to expanding stakeholder expectations and evolving regulatory mandates. First, a top five global payments provider signed a six-figure expansion for Workiva Carbon. They purchased our carbon solution to support multiple regulatory frameworks as well as the California climate disclosure rules. The deal replaced a legacy carbon accounting system and represented a competitive win over four alternative solutions. The customer has been publishing a global impact report for seven years, aligning its disclosures with GRI, SASB, UNGC, and the UN SDGs. but it found that its prior carbon accounting system was insufficient to meet the evolving requirements. This deal was a co-sell and will be delivered by a Big Four firm. Second, a top five Australian bank signed a six-figure expansion for sustainability reporting. It was to meet the new Australian Sustainability Reporting Standards, AASB S1 and S2. These standards require sustainability disclosures within annual filings, and they cover governance, strategy, risk management, and scope 1, 2, and 3 emissions. Australia's approach demonstrates how regulators are embedding sustainability into financial reporting through ISSB alignment. Approximately 1,000 organizations qualify as Group 1 filers with the first mandatory reports due June 30th of 2026 for June year-end entities. This deal was sourced and will be implemented by a Big Four firm. Let's move on now to GRC, which in Q3 included several notable wins. First, a U.S. financial holding company, signed a mid-six-figure expansion for enterprise risk management. A Workiva SEC reporting customer since 2012, this firm has expanded into seven solutions across the platform, including multi-entity reporting, living will, stress testing, bank regulatory reporting, sustainability reporting, and now enterprise risk management. This most recent expansion increased annual spend by 25%. The new solution will centralize 45 internal enterprise risk reports covering risk metrics, categories, subcategories, and risk statements. The deal was a co-sale and will be implemented by a Big Four firm. Second, a U.S.-based regional community bank signed a multi-six-figure expansion for three GRC solutions. controls management, operational risk management, and policy management. A 13-year SEC reporting customer, the bank now uses five Workiva solutions. This expansion more than tripled its annual spend. The deal was sourced and will be delivered by a regional consulting firm. Wrapping up our solution section, here are a few highlights on capital markets. Q3 saw a notable uptick in IPO activity. Workiva supported several high-profile IPO listings, including Figma, Klarna, Heartflow, and Shoulder Innovations. For Workiva, an improving capital markets environment extends well beyond the S-1 filings. First, we engage with private companies years before they go public through our private company reporting and internal control solutions. We believe that a stronger IPO outlook increases the incentive for companies to invest early in scalable reporting processes. And second, more SEC registrants expand the addressable market for additional Workiva solutions, including SEC and SOX reporting, even in instances where we're not directly involved in the S-1. We're encouraged by Q3 IPO activity and the economic environment supporting the rebound. We're optimistic that the IPO momentum will continue into Q4 once the U.S. government shutdown ends. Let's shift focus to discuss innovation. In September, we hosted Amplify, our annual user conference. We welcomed over 2,300 customers, partners, and investors in Washington, D.C. We showcased our commitment to innovation, and we launched product enhancements continue to meet and exceed our customers' growing expectations. During the event, we announced several agentic AI extensions, and we launched Intelligent Finance, Intelligent Sustainability, and Intelligent GRC. Each delivers specialized fit-for-purpose capabilities that enhance customer speed, agility, and confidence. These offerings leverage the fact that the Workiva platform is intelligence-ready. Being intelligence ready means that all data and narratives are structured, consistent, traceable, interpretable, machine readable, and built with context, not just content. This is what differentiates Workiva. Our reports are structured, validated data products, not static documents. They allow AI and automation to read, reconcile, and publish with full lineage, embedded controls, and regulator-grade assurance. We also embed global frameworks and taxonomies directly into the platform, transforming every report into a machine interpretable data product. As a result, AI can operate without guessing what's material, how metrics are defined, or how to compare them. With Workiva AI at the core of our unified platform, we're delivering an intelligent companion that enables customers to achieve their most critical outcomes faster and with confidence. A great example of how our AI capabilities are driving value to our customers is a Q3 multi-six figure new logo win with a rapidly growing privately held defense contractor. The customer purchased four solutions, controls management, policy management, compliance management, and private company financial reporting. It was our AI-powered GRC capabilities that differentiated us from the competition. This company is building their first controls management framework. They're creating company policies and building a compliance program for the cybersecurity maturity model certification. This is a prerequisite for doing business with the U.S. military. By leveraging Workiva AI, including the AI-powered control creator, the customer will author and implement policy control and compliance frameworks in-house, reducing reliance on third-party consulting spend. At Amplify, we also hosted our annual Investor Day. We detailed our commitment to both durable growth and improved operating leverage. Our recent margin progress in 2025 reflects the disciplined approach we've been taking to achieve greater operating leverage in the business. Since the start of the year, across every function, every department, and every team, we've been focused on four themes. First, organizational and operating model redesign. We're simplifying span of control and reducing layers. We're evolving the operating model across sales, customer success, and R&D. And we're putting a greater emphasis on performance management. These ongoing efforts will provide a structure that reduces duplication and strengthens execution. Second, process streamlining and automation. This includes both single and cross-functional initiatives. We're streamlining and improving workflows and leveraging technology where it brings value. And yes, that includes the automation of routine tasks and the use of AI. Third, Optimizing product and go-to-market resources. We're sharpening our investment discipline so that we can direct resources towards initiatives with the highest likelihood of success and the greatest customer value. And finally, more focus on fiscal discipline. We're exercising greater financial discipline across all functions. These focus areas are designed to increase productivity as we grow and scale and drive greater operating leverage across the business. By functional area, here's a quick summary of our productivity initiatives. For cost of sales, we're scaling digital support, optimizing cloud computing costs, and shifting low margin setup and consulting services to our partners to get greater leverage. For R&D, We're focused on workforce diversification, engineering productivity, and scaling our operating model. Finally, we do recognize sales and marketing is where we have the largest opportunity to drive additional efficiency and productivity. Our approach is practical to minimize the risk of disrupting growth as we continue to focus on capturing our large and expanding TAMs. we've targeted three areas to improve sales productivity. First, transitioning to a more efficient sales structure and creating better alignment of sellers to territories. Second, a focus on staff, which includes upleveling our seller expectations and bringing in new hires that have seen scale, sold platforms, and know how to win with strategic partners. And third, We're bringing even more precision to where and what we sell, optimizing our coverage models to improve efficiency, drive focused new logo growth, and achieve greater account expansion. We're committed to staying in the lead and going after our growth opportunity, while at the same time improving productivity within and across our organization. Finally, I'd like to share an important leadership update. After over 15 years with Workiva, Michael Hawkins is stepping down from his role as Executive Vice President and Chief Sales Officer, effective today, November 5th. Mike has been part of Workiva since our early days, and he's helped to shape the company that we've become. Mike has played a key role in our evolution from a single solution company in the U.S. to a trusted global platform serving thousands of customers. I'd like to thank Mike for his years of leadership, his dedication to our mission, and his many contributions to our success. His impact on our people, our customers, and our growth will be felt long after his departure. We also announced today the appointment of Michael Pinto as our new Executive Vice President and Chief Revenue Officer. Michael's career spans more than 25 years, driving rapid growth for some of the world's largest technology companies. Most recently, he was the Senior Vice President and General Manager for the Americas at Databricks, a $4 billion revenue run rate data and AI company. Prior to Databricks, he held senior sales leadership roles at Amazon Web Services, Medidata, and SAP. Michael will oversee Workiva's global sales, partnerships and alliances, and commercial operations. He'll focus on scaling and accelerating profitable growth, modernizing go-to-market strategies, strengthening customer engagement, and advancing global expansion. We believe that his leadership experience, his track record of guiding multiple companies to scale, and his deep understanding of enterprise SaaS strongly align to what's required for our next phase of growth. Finally, a brief update on our CFO search. We have identified a final candidate, but we're not yet able to provide detail at this time. As you know, bringing in a sitting public company CFO is a complex process, and there is a sensitivity in the timing of the communications and the announcements. In closing, I'd like to thank our team of dedicated employees across the globe for their relentless focus on innovation, our customer success, and our go-to-market execution that continues to fuel our growth. I'd also like to acknowledge their disciplined commitment to productivity and performance that's driving measurable improvement in operating leverage in our business. And with that, I'll now turn the call over to Jill to walk you through our financial results and updated 2025 guidance in more detail. Over to you, Jill.