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Workday Inc  (NAS:WDAY) Operating Margin %: -24.59% (As of Oct. 2018)

Operating Margin % is calculated as Operating Income divided by its Revenue. Workday Inc's Operating Income for the three months ended in Oct. 2018 was $-183 Mil. Workday Inc's Revenue for the three months ended in Oct. 2018 was $743 Mil. Therefore, Workday Inc's Operating Margin % for the quarter that ended in Oct. 2018 was -24.59%.

Good Sign:

Workday Inc operating margin is expanding. Margin expansion is usually a good sign.

NAS:WDAY' s Operating Margin % Range Over the Past 10 Years
Min: -58.35   Max: -14.15
Current: -16.22

-58.35
-14.15

NAS:WDAY's Operating Margin % is ranked lower than
79% of the 1940 Companies
in the Global industry.

( Industry Median: 5.13 vs. NAS:WDAY: -16.22 )

Workday Inc's 5-Year Average operating margin Growth Rate was 18.00% per year.

Workday Inc's Operating Income for the three months ended in Oct. 2018 was $-183 Mil. Its operating income for the trailing twelve months (TTM) ended in Oct. 2018 was $-424 Mil.


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Workday Inc Annual Data

Jan12 Jan13 Jan14 Jan15 Jan16 Jan17 Jan18
Operating Margin % Premium Member Only Premium Member Only -32.69 -27.38 -21.60 -22.43 -14.15

Workday Inc Quarterly Data

Jan14 Apr14 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17 Oct17 Jan18 Apr18 Jul18 Oct18
Operating Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -14.41 -13.96 -11.52 -13.25 -24.59

Competitive Comparison
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.


Workday Inc Distribution

* The bar in red indicates where Workday Inc's Operating Margin % falls into.



Calculation

Operating margin - also known as operating income margin, operating profit margin and return on sales (ROS) - is the ratio of Operating Income divided by net sales or Revenue, usually presented in percent.

Workday Inc's Operating Margin for the fiscal year that ended in Jan. 2018 is calculated as

Operating Margin %=Operating Income (A: Jan. 2018 ) / Revenue (A: Jan. 2018 )
=-303.223 / 2143.05
=-14.15 %

Workday Inc's Operating Margin for the quarter that ended in Oct. 2018 is calculated as

Operating Margin %=Operating Income (Q: Oct. 2018 ) / Revenue (Q: Oct. 2018 )
=-182.755 / 743.189
=-24.59 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Explanation

Just like Gross Margin %, it is important to see a company maintains its operating margin over time. Among the same industry, a company with higher operating margin is more efficient in its operation. It is also more stable during industry slowdown or recessions. Peter Lynch prefers those with higher margins than those with lower margins.


Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia’s Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.


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