Renowned for its human resources software, Workday Inc. sales for the 3rd quarter were more than what the analysts had estimated. This is primarily because more firms took advantage of the Workday’s cloud computing offerings to effectively manage their employees. The projected sales for the 3rd quarter which ended in October 31 were $64 million while the actual sales reached $72.6 million.
Founded by Aneel Bhusri and Dave Duffield in 2005, Workday has provided applications for companies to manage their financial transactions as well as human resources. It was able to entice customers to sign up with them instead of signing with Salesforce.com, SAP, or Oracle. According to Canaccord Genuity Inc. analyst Richard Davis, a lot of business applications must be upgraded because they are at least 5 years old. Although SAP and Oracle are here to stay, these companies no longer have a huge market share.
According to Workday’s Chief Financial Officer Mark Peek, the company will continue to strengthen its product development in order to provide a suite of applications for various businesses. It had announced that it will be introducing new applications for recruitment and corporate data analysis by mid-2014. Although analysts expected the company to report a net loss of $46.6 million, it announced a $41.3 million net loss. Last year, it reported a net loss of $19.7 million.
For the 4th quarter, Workday’s revenue is expected to be between $75 million and $79 million although analysts had projected the 4th quarter revenues to be $70.5 million. According to Co-Chief Executive Officer Bhusri, more and more customers are searching for software alternatives because they feel the need to upgrade their current software applications.
During the recent Workday conference in Las Vegas, Bhusri was quoted as saying that the company’s recruitment functionality has been the most requested application for the past 3 years. The functionality includes mobile hiring, sourcing and pipeline analytics, and internal and external evaluation of candidates. The company is also set to introduce its “Big Data Analytic’s tool”, using the Hadoop framework. Bhusri is also expecting some 90% of the HR and financial markets to switch to cloud computing for the next 10 years.