Workiva Inc. 2026 Q2 Earnings Call

Please go ahead. Good afternoon, and thank you for joining Workiva's Q2 2026 conference call.

During today's call, we will review our second quarter results and discuss our guidance for the third quarter and full year 2026. Today's call will include comments from our Chief Executive Officer, Julie Iskow, followed by our Chief Financial Officer, Barbara Larson. We will open up the call for a Q&A session. After market close today, we issued a press release which is available on our investor relations website, along with our quarterly investor presentation. 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 third quarter and full fiscal year 2026.

These forward-looking statements are based on our assumptions as to the macroeconomic, political, and regulatory environment as of today, reflect management's current expectations and beliefs based on factors currently known to us, and are subject to significant risks and uncertainties. Workiva 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. 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 Iskow.

Thank you, Katie, and thank you all for joining us today. Q2 2026 delivered another quarter of strong financial performance and continued demand for our trusted platform. We beat the high end of our revenue guidance with 19% growth in both subscription revenue and total revenue. We also continued to execute on our commitment to profitable growth, achieving a Q2 non-GAAP operating margin of 16.8%. This was a 180 basis point beat on the high end of our guide and a 1,300 basis point improvement compared to Q2 of last year. Our Q2 results once again reflect broad-based, durable demand across our entire portfolio of solutions. It also reflects our unwavering commitment to operational efficiency as we scale our business. Because of our strong operating margin performance in the first half of the year, we're raising our full year 2026 non-GAAP operating margin guidance to 18%.

This 18% operating margin target is an important milestone for Workiva. This was the target communicated in our 2027 operating model. With this updated 2026 guide, we will be delivering on that operating margin target a full year early. This margin milestone reflects disciplined execution across every part of our business. It reflects deliberate changes to how we're organized, to how we deploy resources, and to where we direct those resources. This isn't a one-quarter result. It's a reflection of the operating model that we continue to improve as we grow. Our growth continues to be supported by the opportunities that we're seeing in the market. The office of the CFO is undergoing one of its most significant transformations in decades. Finance leaders are being asked to do far more than close books and report results.

Today, they're also responsible for the data that their businesses rely on and how AI is governed. They're helping their organizations navigate a more complex regulatory and risk environment. That's only part of the story. AI is also changing what's expected of the people that are doing the work. CFOs and their teams are expected to deliver insights in hours instead of days. They're expected to automate more of the work that's still manual, answer more questions with greater confidence, and respond faster as regulations and business conditions continue to change. They're also no longer expected to simply use enterprise software. There's now an expectation that they'll extend it and build upon it. Users are becoming builders. They're creating AI agents. They're automating complex processes. They're connecting trusted business data with the rest of their technology ecosystem. They're extending the platforms they already rely on every day.

They're expected to do all of this while maintaining the governance, the security, the accuracy, and the auditability that the office of the CFO demands. As AI becomes more embedded in more business processes, trusted, connected, and traceable data matters more than ever. This is exactly where Workiva can make the biggest difference. Our customers shouldn't have to assemble AI models and agents and enterprise systems and governance tools just to meet these new expectations. They shouldn't have to choose between adopting the latest AI capabilities and maintaining the trust that their organizations depend on. They should be able to do both. That's why we're building intelligent capabilities that customers can put to work immediately. Some customers will use these capabilities as they are. Others will want to go further.

They'll connect Workiva with more of their systems, build their own agents, extend workflows, or use Workiva as part of a broader AI ecosystem. Our approach supports both. We deliver the AI capabilities that our customers need today while giving them the flexibility to build, to connect, and to extend those capabilities inside Workiva and beyond it, all grounded in the trusted data governance and controls that they already manage within the Workiva platform. We believe this combination will help finance organizations meet the rapidly rising expectations of the office of the CFO. It's what our customers are asking for, and it's what we're building. We believe no one is better positioned to deliver it than Workiva. This value proposition is resonating at the highest levels of the enterprise. Our largest customers are standardizing on Workiva, and it shows in our large contract cohorts.

In Q2, contracts valued over $300,000 annually grew 34%, and contracts above $500,000 annually grew 33%, both compared to Q2 of 2025. This growth reflects both continued expansion within our existing customer base and the landing of larger multi-solution new logos. I'd like to highlight a few of our Q2 deals that demonstrate how our platform is winning in the market to solve our customers' most complex reporting challenges. First, we signed a mid-six-figure account expansion deal with a global digital banking and fintech leader for Private Company Reporting, Multi-Entity Financial Reporting, connected bank reporting, and Sustainability. The bank is on a multi-year private-to-public journey while expanding globally and transitioning to a full-service regulated bank. The investment in Workiva as a core financial and regulatory reporting platform is central to supporting this transformation across Tax Reporting, sustainability disclosures, and Basel Pillar 3 regulatory compliance.

Second, we signed a multi-six-figure new logo deal with a U.S.-based global material science company. The customer purchased four solutions: SEC reporting, Management Reporting, controls management, and Sustainability. Following a highly competitive process, they chose Workiva over a multiple-point solution vendor approach because of our ability to serve as their definitive system of truth. They recognized that no combination of disparate vendors could replicate our platform without sacrificing data connectivity, collaboration, and trust. Workiva will support this company's rapid expansion through acquisition and their increased focus on global distribution. The deal was a co-sell and will be delivered by a regional advisory firm. I'll turn now to Financial Reporting. Demand continues to build as companies modernize complex global operating models. The bar for what that requires keeps rising.

Organizations need continuous access to accurate and traceable data to stay report-ready and audit-ready, not just at quarter-end, but continuously throughout the quarter. Here are a few of the many Q2 wins worth highlighting. First, we signed a mid-six-figure new logo deal with a U.S.-based global government and defense technology services company. This customer purchased SEC reporting, Multi-Entity Financial Reporting, Management Reporting, and Sustainability. The primary driver for this opportunity was a global enterprise reporting transformation initiative that spans the company's operations in more than 90 countries. With complex and evolving reporting requirements across numerous jurisdictions, the customer sought a single platform capable of supporting global governance and local compliance. They selected Workiva because our unified platform enables them to meet the unique reporting mandates in the markets in which they operate while empowering distributed teams worldwide to modernize and streamline their critical reporting processes.

Second, we signed a mid-six-figure expansion deal with a U.S. regional bank. This loyal customer upgraded to our advanced tiers for both SEC reporting and sustainability, and they expanded across three additional solutions: Tax Reporting, Living Will, and stress testing. The primary catalyst for this expansion was the bank's reclassification as a Category 3 institution. This significantly expanded its regulatory reporting obligations. The deal was a co-sell with a regional advisory firm. I'll move on now to one of our key vertical specific solution categories, financial services. We continue to see strong demand as institutions navigate increasingly complex regulatory requirements. Here are a few highlights from the quarter in this vertical. First, we signed a high six-figure account expansion deal with a large global private equity firm for Fund Reporting. This company signed on as a Workiva customer in Q3 of 2024.