Kyle Aberasturi, on for Dan Jester of BMO Capital Markets, asked about the potential impact of the new R&D tax credit policy on the company's cash flows.
CFO Patrick Villanova confirmed that the proposed bill would have a beneficial impact, projecting an approximate $10 million increase in free cash flow in the second half of the year, with a more significant positive effect expected in 2026 and beyond.
Kyle Aberasturi, on for Daniel Jester, asked for the key product portfolio drivers behind the strong growth in large customers and for an update on the competitive landscape. He also inquired about investment plans and headcount expectations for the remainder of 2025 and into 2026.
CEO Julie Iskow reiterated that demand is broad-based across the entire solution portfolio, not concentrated in one area, which is a key strength. She described the competition as primarily point solutions and legacy technology, against which Workiva's unified, partner-connected platform is a strong differentiator. CFO Jill Klindt added that investment and hiring will be disciplined, with a focus on productivity and leverage from existing resources to ensure profitable growth in line with long-term margin goals.
Kyle Aberasturi from BMO Capital Markets, on for Dan Jester, asked for more detail on the S/4HANA customer win and the related pipeline. He also inquired about the performance of 'carbon-first' deals and cross-selling to legacy Sustain.Life customers.
CEO Julie Iskow described the S/4HANA deal as a typical engagement driven by partners with ERP practices. Regarding Workiva Carbon, CFO Jill Klindt clarified that the legacy Sustain.Life business was immaterial and the strategic focus is on using the new capability to drive organic growth for the entire Workiva platform, not on cross-selling to a small acquired base.