Business Combinations (Tables)

12 Months Ended

Jan. 31, 2019

Schedule of Business Acquisitions, by Acquisition

The purchase consideration transferred consisted of the following (in thousands):



	Purchase Consideration
Cash paid to common and preferred stockholders, warrant holders, and vested option holders	$	1,408,422
Debt repaid by Workday on behalf of Adaptive Insights	53,696
Transaction costs paid by Workday on behalf of Adaptive Insights	23,375
Fair value of assumed Adaptive Insights awards attributable to pre-combination services ⁽¹⁾	5,424
Total purchase consideration	$	1,490,917


⁽¹⁾	The assumed awards were primarily options, which were valued based upon the Black-Scholes option-pricing model.

Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed

The following table summarizes the estimated fair values of assets acquired and liabilities assumed in the business combinations during fiscal 2017 (in thousands):



Cash and cash equivalents	$	3,390
Other tangible assets	3,466
Developed technology	45,039
Customer relationships	1,000
Accounts payable and other liabilities	(3,256		)
Unearned revenue	(6,000		)
Net assets acquired	43,639
Goodwill	107,658
Total purchase consideration	$	151,297

The preliminary purchase consideration allocation, which includes measurement period adjustments, was as follows (in thousands):



Assets acquired:
Cash and cash equivalents	$	37,892
Trade and other receivables, net	23,042
Prepaid expenses and other current assets and other assets	3,183
Property and equipment, net	2,246
Acquisition-related intangible assets, net	316,000
Total assets acquired	$	382,363

Liabilities assumed:
Accounts payable	$	3,115
Accrued expenses and other current liabilities	9,092
Accrued compensation	13,545
Unearned revenue ⁽¹⁾	67,754
Other liabilities	1,919
Total liabilities assumed	95,425
Net assets acquired, excluding goodwill	286,938
Total purchase consideration	1,490,917
Estimated goodwill	$	1,203,979


⁽¹⁾	The cost build-up method was used to determine the fair value of unearned revenue.

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination

The fair value of the separately identifiable finite-lived intangible assets acquired and estimated useful lives are as follows (in thousands, except years):



	Estimated Fair Values		Estimated Useful Lives
Trade name	$	12,000	1.5
Developed technology	105,000		5.0
Customer relationships	188,000		9.0 - 10.0
Backlog	11,000		2.0
Total acquisition-related intangible assets	$	316,000

Business Acquisition, Pro Forma Information

The pro forma financial information shown below summarizes the combined results of operations for Workday and Adaptive Insights as if the closing of the acquisition had occurred on February 1, 2017, the first day of our fiscal year 2018. The pro forma financial information includes adjustments that are directly attributable to the business combination and are factually supportable. The adjustments primarily reflect the amortization of acquired intangible assets, share-based compensation expense for replacement awards, as well as the pro forma tax impact for such adjustments. The pro forma financial information reflects $67 million of nonrecurring expenses related to acquisition costs and certain compensation expenses.



	Year Ended January 31,
	2019			2018

	(in thousands, except per share data)
Total revenues	$	2,886,057		$	2,228,917
Net loss	(425,604		)	(529,404		)
Net loss per share, basic and diluted	$	(1.96	)	$	(2.55	)