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  • Workday management finds their shares to be undervalued 🪙

Workday management finds their shares to be undervalued 🪙

And: Workday, CrowdStrike, VMware Q3 reports 📒 // Shopify record Black Friday 🛍

This is the Cloudly Update. Helping you stay above the Clouds. Today we focus on Q3 reports. Shopify also presented record Black Friday numbers, despite the ongoing recession and turmoil in the economy,

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Workday, a leading enterprise cloud applications provider for finance and human resources, reported $0.99 earnings per share, excluding non-recurring items, $0.15 better than the S&P Capital IQ Consensus of $0.84.

Their revenue increased 20.5% year-on-year to $1.6 billion vs. market expectations of $1.59 billion. Subscription revenue was $1.43 billion, an increase of 22.3% from last year.

Subscription revenues were $1.43 billion, an increase of 22.3% yr/yr.

For FY23, Workday is raising the low end of its subscription revenue guidance to $5.555- $5.557 billion, or 22% growth. They are also raising its FY23 non-GAAP operating margin guidance to 19.2%.

Workday posted that its Board of Directors approved buying back up to $500 million of its Class A common stock shares. Workday CFO said this program reflects their belief that their shares are undervalued and a long-term opportunity lies ahead.

As per Workday's press release, the share repurchase program will have an 18-months term. However, it may be suspended and discontinued at any time. Also, it does not obligate the company to acquire any amount of Class A common stock.

A global cybersecurity leader, CrowdStrike Holdings reported revenue growth of 52.8% yearly. Q3 revenue was recorded at $580.88 million, beating market expectations of $575.06 million. Subscription revenue increased 53% at $547.4 million, vs. $357.0 million in Q3 of 2022.

EPS was at $0.40 (excluding non-recurring items), $0.08 better than the S&P Capital IQ Consensus of $0.32.

ARR increased 54% year-over-year and grew to $2.34 billion as of October 31, 2022, of which $198.1 million was net new ARR added in the quarter. However, the net new ARR was below CrowdStrike's expectations due to elongated sales cycles of smaller customers. And some large clients pursued multi-phase subscription start dates and delayed ARR recognition until future quarters.

CrowdStrike added 1,460 net new subscription customers in the quarter for a total of 21,146 subscription customers as of October 31, 2022, representing 44% growth year-over-year.

CrowdStrike issued mixed guidance for Q4 and sees EPS of $0.42-0.45, excluding non-recurring items, vs. $0.34 S&P Capital IQ Consensus. They expect Q4 revenue between $619.1-628.2 million vs. $634.19 million S&P Capital IQ Consensus.

Shopify merchants saw sales of $3.36 billion on Black Friday. Per the Shopify press release, there was a 17% growth in sales compared to Black Friday sales in 2021.

Shopify noted that:

  • Top selling countries were the U.K, the U.S., and Canada

  • Apparel, health and beauty products, and home and garden accessories were sought out the most

  • The average cart price was $102.21 or $105.10 on a constant currency basis

VMware, a leading innovator in enterprise software, recorded $3.21 billion in revenue in the third quarter of the fiscal year 2023. Subscription and SaaS revenue increased by 20% year-over-year at $988 million and constituted 31% of total revenue.

The combination of subscription and SaaS and license revenue was $1.61 billion & increased by 5% from the third quarter of fiscal 2022.

Subscription and SaaS ARR were up 24% year-over-year and $4.10 billion. It reflects increased adoption of their multi-cloud product portfolio and recently introduced customer programs.

RPO increased 7% year-over-year and was recorded at $11.90 billion.

VMware expanded partnerships with Microsoft and IBM to deliver quick, cost-effective cloud services for digital businesses.

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