February 29, 2016 / 9:35 PM / 2 years ago

HR software maker Workday's revenue forecast misses Street

(Reuters) - Human resources software maker Workday Inc forecast current-quarter revenue below analysts’ expectations amid industrywide worries about weak demand.

The company, which makes software to manage employee performance, payroll and expense, forecast revenue of $337 million-$339 million for the first quarter ending April.

Analysts on average were expecting revenue of $343.1 million, according to Thomson Reuters I/B/E/S.

Shares of Workday, whose customers include Bank of America Corp and MGM Resorts International, were little changed in extended trading on Monday.

Cloud-computing companies’ shares, including Workday‘s, were hit this month after weak sales forecast from Tableau Software Inc sparked worries about valuations and potentially sluggish enterprise IT spending.

“Regarding the macro environment, we continue to monitor our pipeline closely but so far we have not witnessed any impact on demand,” Workday Chief Executive Aneel Bhusri said on a conference call.

The company raised its first-quarter billings forecast to $360 million-$365 million from $350 million.

Workday reported a bigger net loss for the fourth quarter ended Jan. 31, hurt by higher spending on sales, marketing and product development.

Sales and marketing costs rose about 37 percent, while product development costs jumped 47.5 percent.

The company’s net loss widened to $81.1 million, or 42 cents per share, from $59.5 million, or 32 cents per share, a year earlier.

On an adjusted basis, the company reported a loss of 1 cent per share.

Revenue rose 43 percent to $323.4 million, helped by strong subscription growth for its web-based human resource management software.

Analysts had expected a loss of 5 cents per share and revenue of $319.6 million.

Up to Monday’s close of $60.45, Workday’s shares had fallen nearly 30 percent in the past 12 months.

Reporting by Abhirup Roy in Bengaluru; Editing by Maju Samuel

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