(State or other jurisdiction

of incorporation)

(Commission

File Number)

(I. R. S. Employer

Identification No.)

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Total revenues were $788.6 million, an increase of 35.4% from the fourth quarter of fiscal 2018. Subscription revenues were $673.5 million, an increase of 37.5% from the same period last year.

Operating loss was $120.3 million, or negative 15.3% of revenues, compared to an operating loss of $81.3 million, or negative 14.0% of revenues, in the same period last year. Non-GAAP operating income for the fourth quarter was $92.7 million, or 11.8% of revenues, compared to a non-GAAP operating income of $55.5 million, or 9.5% of revenues, in the same period last year.¹

Net loss per basic and diluted share was $0.47, compared to a net loss per basic and diluted share of $0.42 in the fourth quarter of fiscal 2018. Non-GAAP net income per diluted share was $0.41, compared to a non-GAAP net income per diluted share of $0.28 in the same period last year.²

Total revenues were $2.82 billion, an increase of 31.7% from fiscal 2018. Subscription revenues were $2.39 billion, an increase of 33.4% from the prior year.

Operating loss was $463.3 million, or negative 16.4% of revenues, compared to an operating loss of $303.2 million, or negative 14.1% of revenues, in fiscal 2018. Non-GAAP operating income was $291.3 million, or 10.3% of revenues, compared to a non-GAAP operating income of $215.6 million, or 10.1% of revenues, in the same period last year.¹

Net loss per basic and diluted share was $1.93, compared to a net loss per basic and diluted share of $1.55 in fiscal 2018. Non-GAAP net income per diluted share was $1.36, compared to a non-GAAP net income per diluted share of $1.03 last year.²

Operating cash flows were $606.7 million.

Cash, cash equivalents, and marketable securities were $1.78 billion as of January 31, 2019. Unearned revenues were $1.95 billion, a 26.8% increase from the same period last year.

In the U.S., Workday was ranked #4 on the 100 Best Companies to Work For list by Fortune and Great Place to Work (GPTW) Institute.

Workday continues to see growing customer momentum as organizations globally select and deploy Workday Financial Management and Workday Human Capital Management (HCM). Customers that have recently selected Workday Financial Management include Allina Health, Banner Health, and Ryder Truck, and customers that have recently selected Workday HCM include Caterpillar, Inc., Sumitomo Chemical, and Wyndham Destinations. In addition to recent customer wins, Workday continues to successfully move customers into production with more than 70 percent live on Workday applications. Customers that have recently deployed Workday Financial Management include Alight Solutions and Quicken Loans, and customers that have recently deployed Workday HCM include Lloyds Bank Plc., McKesson Corporation, and Siemens AG.

Workday was ranked #1 in both Enterprise Resource Planning and Talent Management in the “2019 Best in KLAS: Software & Services” report, an industry-leading healthcare ranking. This is the second year in a row Workday has received these awards, which celebrate vendors who have achieved the highest ratings from healthcare providers.

Workday announced that customers are running Workday applications – including Workday Financial Management and Workday HCM – in the public cloud on Amazon Web Services, Inc.

Further demonstrating its ongoing commitment to global customer privacy, Workday announced that it is the first company to be certified by TrustArc to the Asia-Pacific Economic Cooperation Privacy Recognition for Processors System, which is intended to strengthen privacy protections and trust across the Asia-Pacific region.

Workday, a member of the Rework America Task Force, joined 11 other large U.S. companies as an expert advisor to help form the Rework America Business Network, which aims to accelerate the development and adoption of innovative hiring and training practices.

Assets

Current assets:

Cash and cash equivalents

Marketable securities

Trade and other receivables, net

Deferred costs

Prepaid expenses and other current assets

Total current assets

Property and equipment, net

Deferred costs, noncurrent

Acquisition-related intangible assets, net

Goodwill

Other assets

Total assets

Liabilities and stockholders’ equity

Current liabilities:

Accounts payable

Accrued expenses and other current liabilities

Accrued compensation

Unearned revenue

Current portion of convertible senior notes, net

Total current liabilities

Convertible senior notes, net

Unearned revenue, noncurrent

Other liabilities

Total liabilities

Stockholders’ equity:

Common stock

Additional paid-in capital

Accumulated other comprehensive income (loss)

Accumulated deficit

Total stockholders’ equity

Total liabilities and stockholders’ equity

Revenues:

Subscription services

Professional services

Total revenues

Costs and expenses ⁽¹⁾:

Costs of subscription services

Costs of professional services

Product development

Sales and marketing

General and administrative

Total costs and expenses

Operating loss

Other income (expense), net

Loss before provision for (benefit from) income taxes

Provision for (benefit from) income taxes

Net loss

Net loss per share, basic and diluted

Weighted-average shares used to compute net loss per share, basic and diluted

⁽¹⁾Costs and expenses include share-based compensation expenses as follows:

Costs of subscription services

Costs of professional services

Product development

Sales and marketing

General and administrative

Cash flows from operating activities

Net loss

Depreciation and amortization

Share-based compensation expenses

Amortization of deferred costs

Amortization of debt discount and issuance costs

Other

Changes in operating assets and liabilities, net of business combinations:

Trade and other receivables, net

Deferred costs

Prepaid expenses and other assets

Accounts payable

Accrued expenses and other liabilities

Unearned revenue

Net cash provided by (used in) operating activities

Cash flows from investing activities

Purchases of marketable securities

Maturities of marketable securities

Sales of marketable securities

Business combinations, net of cash acquired

Owned real estate projects

Capital expenditures, excluding owned real estate projects

Purchases of non-marketable equity and other investments

Sales and maturities of non-marketable equity and other investments

Purchase of other intangible assets

Other

Net cash provided by (used in) investing activities

Cash flows from financing activities

Proceeds from borrowings on convertible senior notes, net of issuance costs

Proceeds from issuance of warrants

Purchase of convertible senior notes hedges

Payments on convertible senior notes

Proceeds from issuance of common stock from employee equity plans

Other

Net cash provided by (used in) financing activities

Effect of exchange rate changes

Net increase (decrease) in cash, cash equivalents, and restricted cash

Cash, cash equivalents, and restricted cash at the beginning of period

Cash, cash equivalents, and restricted cash at the end of period

Supplemental cash flow data

Cash paid for interest, net of amounts capitalized

Cash paid for income taxes

Non-cash investing and financing activities:

Vesting of early exercised stock options

Purchases of property and equipment, accrued but not paid

Non-cash additions to property and equipment

Reconciliation of cash, cash equivalents, and restricted cash as  shown in the statements of cash flows

Cash and cash equivalents

Restricted cash included in Prepaid expenses and other current assets

Restricted cash included in Other assets

Total cash, cash equivalents, and restricted cash

Costs and expenses:

Costs of subscription services

Costs of professional services

Product development

Sales and marketing

General and administrative

Operating income (loss)

Operating margin

Other income (expense), net

Provision for (benefit from) income taxes

Net income (loss)

Net income (loss) per share ⁽¹⁾

GAAP net loss per share is calculated based upon 220,351 basic and diluted weighted-average shares of common stock. Non-GAAP net income per share is calculated based upon 241,212 diluted weighted-average shares of common stock.

Other operating expenses include total employer payroll tax-related items on employee stock transactions of $8.9 million and amortization of acquisition-related intangible assets of $19.3 million.

We utilize a fixed long-term projected tax rate in our computation of the non-GAAP income tax provision to provide better consistency across the reporting periods. For fiscal 2019, we have determined the projected non-GAAP tax rate to be 17%.

Costs and expenses:

Costs of subscription services

Costs of professional services

Product development

Sales and marketing

General and administrative

Operating income (loss)

Operating margin

Other income (expense), net

Income (loss) before provision for (benefit from) income taxes

Provision for (benefit from) income taxes

Net income (loss)

Net income (loss) per share ⁽¹⁾

GAAP net loss per share is calculated based upon 210,909 basic and diluted weighted-average shares of common stock. Non-GAAP net income per share is calculated based upon 237,164 diluted weighted-average shares of common stock.

Other operating expenses include total employer payroll tax-related items on employee stock transactions of $5.3 million and amortization of acquisition-related intangible assets of $4.9 million.

Costs and expenses:

Costs of subscription services

Costs of professional services

Product development

Sales and marketing

General and administrative

Operating income (loss)

Operating margin

Other income (expense), net

Provision for (benefit from) income taxes

Net income (loss)

Net income (loss) per share ⁽¹⁾

GAAP net loss per share is calculated based upon 216,789 basic and diluted weighted-average shares of common stock. Non-GAAP net income per share is calculated based upon 237,890 diluted weighted-average shares of common stock.

Other operating expenses include total employer payroll tax-related items on employee stock transactions of $32.0 million and amortization of acquisition-related intangible assets of $49.1 million.

We utilize a fixed long-term projected tax rate in our computation of the non-GAAP income tax provision to provide better consistency across the reporting periods. For fiscal 2019, we have determined the projected non-GAAP tax rate to be 17%.

Costs and expenses:

Costs of subscription services

Costs of professional services

Product development

Sales and marketing

General and administrative

Operating income (loss)

Operating margin

Other income (expense), net

Income (loss) before provision for (benefit from) income taxes

Provision for (benefit from) income taxes

Net income (loss)

Net income (loss) per share ⁽¹⁾

GAAP net loss per share is calculated based upon 207,774 basic and diluted weighted-average shares of common stock. Non-GAAP net income per share is calculated based upon 234,089 diluted weighted-average shares of common stock.

Other operating expenses include total employer payroll tax-related items on employee stock transactions of $21.0 million and amortization of acquisition-related intangible assets of $19.4 million.

Share-based compensation expenses. Although share-based compensation is an important aspect of the compensation of our employees and executives, management believes it is useful to exclude share-based compensation expenses to better understand the long-term performance of our core business and to facilitate comparison of our results to those of peer companies. Share-based compensation expenses are determined using a number of factors, including our stock price, volatility, and forfeiture rates, that are beyond our control and generally unrelated to operational decisions and performance in any particular period. Further, share-based compensation expenses are not reflective of the value ultimately received by the grant recipients.

Other operating expenses. Other operating expenses includes employer payroll tax-related items on employee stock transactions and amortization of acquisition-related intangible assets. The amount of employer payroll tax-related items on employee stock transactions is dependent on our stock price and other factors that are beyond our control and do not correlate to the operation of the business. For business combinations, we generally allocate a portion of the purchase price to intangible assets. The amount of the allocation is based on estimates and assumptions made by management and is subject to amortization. The amount of purchase price allocated to intangible assets and the term of its related amortization can vary significantly and are unique to each acquisition and thus we do not believe it is reflective of ongoing operations.

Amortization of debt discount and issuance costs. Under GAAP, we are required to separately account for liability (debt) and equity (conversion option) components of the convertible senior notes that were issued in private placements in June 2013 and September 2017. Accordingly, for GAAP purposes we are required to recognize the effective interest expense on our convertible senior notes and amortize the issuance costs over the term of the notes. The difference between the effective interest expense and the contractual interest expense, and the amortization expense of issuance costs are excluded from management’s assessment of our operating performance because management believes that these non-cash expenses are not indicative of ongoing operating performance. Management believes that the exclusion of the non-cash interest expense provides investors an enhanced view of Workday’s operational performance.

Income tax effects. We utilize a fixed long-term projected tax rate in our computation of the non-GAAP income tax provision to provide better consistency across the reporting periods. In projecting this long-term non-GAAP tax rate, we utilize a three-year financial projection that excludes the direct impact of share-based compensation and related employer payroll taxes, amortization of acquisition-related intangible assets, and amortization of debt discount and issuance costs. The projected rate considers other factors such as our current operating structure, existing tax positions in various jurisdictions, and key legislation in major jurisdictions where we operate. For fiscal 2019, we have determined the projected non-GAAP tax rate to be 17% after including our acquisition of Adaptive Insights, Inc., which did not have a significant impact to this rate. We will periodically re-evaluate this tax rate, as necessary, for significant events, based on our ongoing analysis of the 2017 U.S. Tax Cuts and Jobs Act, relevant tax law changes, material changes in the forecasted geographic earnings mix, and any significant acquisitions.