WalkMe Q4 2023: The Company Reaches a Record Profitability Milestone

WalkMe Q4 2023: The Company Reaches a Record Profitability Milestone

The News: WalkMe announced earnings for fourth quarter (Q4) 2023 that ended on December 31, 2023. The company’s revenue for the quarter was $67.9 million versus $64.9 million in the year-ago period, demonstrating an increase of 5% year-over-year (YoY). Read the full Q4 2023 earnings release on WalkMe’s website for more information.

By the numbers for Q4 2023:

  • Total Q4 2023 revenue of $67.9 million, up 5% YoY; subscription revenue grew 8% YoY to reach $63.4 million
  • Full year (FY) 2023 revenue landed at $267 million at the end of 2023, a 9% YoY gain
  • Q4 2023 non-GAAP gross margin of 86%, up from 82% in the same quarter a year ago
  • Q4 2023 non-GAAP operating income was $4.8 million versus a loss of ($10.5) million in the Q4 2022
  • Q4 2023 non-GAAP operating margin improved to 7% from (16%) last year
  • Q4 2023 non-GAAP net income per share was of $0.07, compared to a net loss of ($0.12) per share one year ago
  • Q4 2023 free cash flow (FCF) of $8.4 million, or 12% of total revenue, compared to negative ($10.2) million, or (16%) of total revenue in Q4 2022
  • 15% YoY growth in digital adoption platform (DAP) customer count

WalkMe’s Q4 2023: The Company Reaches a Record Profitability Milestone

Analyst Take: WalkMe rounded out what the company described as a transformational 2023 with strong results, continued customer growth, and new product innovation. The company continues to be profitable and has made impressive improvements in FCF. WalkMe saw $4.8 million in operating profit and $8.4 million in free cash flow, on a non-GAAP basis. Revenue for the quarter was $67.9 million, a 5% YoY increase.

Customer Wins, Continued Progress in Customer Success, and Sales Strategy

This past quarter, WalkMe reached a new high of 199 DAP customers. The number of customers that have over $1 million in annual recurring revenue (ARR) grew to 41 companies, representing 34% of ARR compared to 32% the previous year. WalkMe had 548 customers with over $100,000 in ARR at the end of 2023, compared with 514 in that category at the end of Q4 2022.

New customers cited include Big D Construction and DS Smith, and the company expanded relationships with many others including BDO Canada and Core Hotel Group. FedRAMP certification has continued to pay dividends and has made sizeable contributions to the company’s ARR.

As mentioned last quarter, and continuing into this quarter, the company put deepened focus on its customer success strategy. WalkMe has redirected resources for better coverage across the company’s renewal base, aimed at providing a better experience for its customers and supporting retention. The company also continues building on its success of transitioning its services strategy to an outcomes-based model, tying it to critical business workflows. There has been early success with this approach, with WalkMe seeing an impressive decrease in time to deployment.

Product Innovation Continues

WalkMe had a solid stream of product innovation over the course of 2023, and most recently, the company announced Workflow Accelerators. This set of solutions help to identify the challenges and roadblocks employees face when interacting with technology during their workday and provide templates that have predefined WalkMe in-app guidance, automations, data validation, and more. Being able to eliminate these often unseen and unforeseen challenges is important—if left unaddressed, it can result in employee frustration, poor productivity, and inefficiencies. This new offering really focuses on making it easy for companies to solve these problems. WalkMe customers have been using Workflow Accelerators in beta testing.

The company also has a new version of its employee hub Workstation product, which will be evolving into an enterprise workflow copilot for employees. WalkMe Discovery as well as Data AI Solutions has a lot of forward momentum with the number of employees covered growing by 50% quarter-over-quarter (QoQ).

Looking Ahead

WalkMe provided revenue guidance for Q1 2023 in the range of $67.6 million to $68.6 million. The company expects non-GAAP operating income of $0.3 million to $1.3 million. The company expects FY 2024 revenue to be in the $279 million to 283 million range with non-GAAP operating income of $8 million to $11 million.

It was a strong quarter from WalkMe, and the company continues to demonstrate that even when facing macroeconomic pressures, as it did in the first half of the year, the company was able to adapt quickly and successfully with a good focus on operational efficiencies while continuing to innovate.

The company stated its goal for 2024 is to double its 2023 net new ARR to double-digit ARR growth, with focus areas being G2K, large enterprises, the US public sector, and sustaining its success with partners. DAP is still a relatively new category, with a lot of room for revenue expansion. The company is well-positioned for growth in the US federal market, being the only FedRAMP-ready DAP provider, and the changes it has instituted for a more cohesive approach to customer success and sales should help with this acceleration. Helping companies save money and unleash the benefits of their technology investments should not be a hard sell this year.

Disclosure: The Futurum Group is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.

Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of The Futurum Group as a whole.

Other Insights from The Futurum Group:

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WalkMe for Shadow AI: Guardrails and Guidance Within the Flow of Work

Author Information

Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.

From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.

A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.

An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.

As a detail-oriented researcher, Sherril is expert at discovering, gathering and compiling industry and market data to create clear, actionable market and competitive intelligence. With deep experience in market analysis and segmentation she is a consummate collaborator with strong communication skills adept at supporting and forming relationships with cross-functional teams in all levels of organizations.

She brings more than 20 years of experience in technology research and marketing; prior to her current role, she was a Research Analyst at Omdia, authoring market and ecosystem reports on Artificial Intelligence, Robotics, and User Interface technologies. Sherril was previously Manager of Market Research at Intrado Life and Safety, providing competitive analysis and intelligence, business development support, and analyst relations.

Sherril holds a Master of Business Administration in Marketing from University of Colorado, Boulder and a Bachelor of Arts in Psychology from Rutgers University.

Keith has over 25 years of experience in research, marketing, and consulting-based fields.

He has authored in-depth reports and market forecast studies covering artificial intelligence, biometrics, data analytics, robotics, high performance computing, and quantum computing, with a specific focus on the use of these technologies within large enterprise organizations and SMBs. He has also established strong working relationships with the international technology vendor community and is a frequent speaker at industry conferences and events.

In his career as a financial and technology journalist he has written for national and trade publications, including BusinessWeek,, Investment Dealers’ Digest, The Red Herring, The Communications of the ACM, and Mobile Computing & Communications, among others.

He is a member of the Association of Independent Information Professionals (AIIP).

Keith holds dual Bachelor of Arts degrees in Magazine Journalism and Sociology from Syracuse University.


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