Workiva Inc (NYSE:WK), a provider of a cloud platform for financial reporting, governance, risk, and compliance (GRC), and sustainability reporting, reported fourth-quarter and full-year 2025 financial results that delivered a significant earnings beat, propelling its stock higher in after-hours trading.
Earnings Snapshot: A Clear Beat on Profitability
The company’s performance for the quarter ended December 31, 2025, was characterized by strong top-line growth and a substantial outperformance on the bottom line relative to Wall Street expectations.
- Revenue: Total revenue reached $239 million, marking a 20% increase year-over-year. This figure came in slightly below the analyst consensus estimate of approximately $241.8 million.
- Earnings Per Share (Non-GAAP): The standout metric was non-GAAP EPS of $0.78, which decisively surpassed the analyst estimate of $0.71. This represents a 136% increase from the $0.33 reported in the prior-year quarter.
The market’s reaction was decisively positive, with shares rising over 8% in after-hours trading following the announcement. This indicates investors are rewarding the company’s accelerated profitability and robust margin expansion more than they are penalizing the slight revenue miss.
Key Financial and Operational Highlights
Beyond the headline earnings beat, Workiva’s press release highlighted several areas of strength that underpin its growth narrative.
Strong Subscription Growth and Margin Expansion: The core subscription business grew 21% year-over-year in Q4 to $219 million. For the full year, subscription revenue increased 22% to $813 million. More notably, the company demonstrated significant progress toward profitability. The non-GAAP operating margin for Q4 expanded to 19.1%, up from 7.4% a year ago. For the full year 2025, the non-GAAP operating margin more than doubled to 9.9% from 4.3% in 2024.
Healthy Customer Metrics and Large Deal Momentum: Workiva ended the year with 6,624 total customers, adding 319 net new customers during 2025. The company’s net revenue retention rate was 113%, indicating existing customers are spending more over time. Perhaps more telling is the growth in large customers:
- Customers with an Annual Contract Value (ACV) over $100,000 grew 22% to 2,507.
- Customers with an ACV over $300,000 grew 42% to 592.
- Customers with an ACV over $500,000 grew 37% to 248.
Robust Cash Generation: The company generated $140 million in net cash from operating activities for the full year, with free cash flow reaching $138 million, representing a free cash flow margin of 15.6%.
Forward Guidance Versus Analyst Expectations
Management provided an optimistic outlook for 2026, which appears to align with or modestly exceed current analyst expectations.
- Q1 2026 Guidance: Workiva expects revenue between $244 million and $246 million. The midpoint of $245 million is approximately 2% above the analyst sales estimate of $247.8 million for the quarter. The company guided for non-GAAP EPS between $0.64 and $0.67, with the midpoint of $0.655 sitting above the current consensus estimate of $0.61.
- Full-Year 2026 Guidance: The company anticipates total revenue between $1.036 billion and $1.040 billion, aiming to surpass the $1 billion revenue milestone. The midpoint of $1.038 billion is slightly below the analyst sales estimate of $1.051 billion. However, the non-GAAP EPS guidance range of $2.66 to $2.76 (midpoint $2.71) is above the current consensus estimate of $2.60. The company also expects its free cash flow margin to improve to approximately 19%.
Market Reaction and Strategic Positioning
The positive after-hours price action suggests the market is interpreting this report as a validation of Workiva’s evolving business model. The focus has shifted from pure top-line growth at all costs to a more balanced approach emphasizing profitable growth, margin expansion, and strong cash flow. The significant beat on EPS and the raised profitability outlook for 2026 are likely the primary drivers behind the stock’s move.
CEO Julie Iskow attributed the strong finish to the year to the relevance of the company’s “AI-powered platform for trust, transparency, and accountability,” particularly for the office of the CFO. New CFO Barbara Larson emphasized a continued focus on “operational excellence” and “margin expansion” alongside growth.
For a detailed look at future earnings estimates and past performance, you can review Workiva’s earnings and estimates data here.
Disclaimer: This article is for informational purposes only and does not constitute investment advice, financial analysis, or a recommendation to buy or sell any security. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions.
