22,000 Customers Now in the Kronos Cloud as Shift to SaaS SurgesJuly 31, 2017
Kronos Incorporated today announced financial results, company advancements, and customer successes for the third quarter of Fiscal 2017. Kronos recognized revenue for the quarter was $332.8 million. Earnings before interest, tax, depreciation, and amortization (EBITDA) was $101.6 million.
Kronos Cloud, Shift to SaaS Continues to Transform the Business
Kronos, having successfully transitioned to a pure software-as-a-service (SaaS) provider, again delivered strong growth in the Kronos Cloud, with subscription revenue increasing 45 percent.
- Kronos continues to add hundreds of customers each quarter to the Kronos Cloud – both net-new customers and current customers that migrated from their on-premise instances – as more than 22,000 organizations around the globe now leverage a Kronos Cloud solution.
- In the quarter, 90 percent of new customer bookings came from an array of Kronos Cloud offerings.
- Kronos had one of its best quarters ever for converting existing Workforce Central on-premise customers to a SaaS solution. Significant on-premise to SaaS conversions included: a family of non-profit hospitals and healthcare organizations in the Midwest U.S.; a large shared services organization serving the health sector in New Zealand; a global food services company that supplies frozen protein products to customers worldwide; an American holding company that offers vehicle rental, sales and sharing, and fleet management; a U.S. manufacturer of bearings and mechanical power transmission components; a large non-profit organization in Minneapolis-Saint Paul focused on youth development, charitable activities, and humanitarian work; a logistics and supply chain organization based in Australia; and one of the most prestigious academic medical centers in the U.S.
- Significant new $1 million+ Kronos Cloud SaaS deployments included: a multinational oil and gas corporation with more than 70,000 employees; the central procurement division for one of the most populous states in the U.S.; the owner and operator of a U.S. chain of discount grocery stores; and a Fortune 100 multinational organization that produces a range of commercial and consumer products.
Workforce Ready Human Capital Management (HCM) Cloud Suite Scales to Record Heights
Workforce Ready, which combines the power of workforce management and HCM into one unified cloud platform, had a record quarter – which included multiple new orders valued at more than $1 million in annual recurring revenue (ARR) – as the company continues to scale its HCM solution.
- Subscription revenue for the Workforce Ready suite increased 57 percent year-over-year as customers large and small increasingly opt for a full-suite solution.
- In the last 12 months, half of all new Workforce Ready bookings included HR and payroll applications.
- Significant HCM deals included: one of the largest poultry producers in the U.S. that will manage more than 14,000 employees with the Workforce Ready suite; a U.S. gaming and entertainment complex; a professional staffing and search firm that specializes in contract, contract-to-hire, and direct hire positions; a company that grows, packs, and ships fruit throughout the U.S.; and an American food producer that is also one of the largest privately held companies in the U.S.
- Kronos announced two Workforce Ready add-on modules in the third quarter – Workforce Ready Talent Acquisition and Workforce Ready Performance Management – and enhanced its scheduling engine to help customers better attract, develop, and retain an engaged workforce.
- HfS Research ranked Kronos a "High Performer" in its Blueprint Guide for Predictive Capabilities in HCM, which highlights Kronos’ commitment to execution and innovation in predictive HCM.
Large, Global Workforce Management Momentum Continues, Powered by Paragon Methodology
Kronos strengthened its position as the worldwide leader in workforce management, as momentum for complex global implementations continued with customers realizing increasingly faster time-to-value.
- The Kronos Paragon implementation methodology is now supported in more than 50 countries to help organizations accelerate and simplify complex, global workforce management deployments by achieving up to 40 percent faster time-to-value.
- Kronos workforce management success around the world – driven by exceptionally-strong quarters in North America, Latin America, and Asia-Pacific – was highlighted by large deals, including: a healthcare system with more than a dozen hospitals across California; a leading retailer in the Baltic states based in Latvia; a large international grocery store chain with an extensive retail presence in Australia and New Zealand; a provider of IT, sales, e-commerce, and marketing support for one of the world’s most recognizable courier delivery services companies; and a non-profit healthcare system with more than 90 hospitals in nearly two dozen U.S. states.
- To provide organizations in every region with maximum value and an exceptional experience, Kronos built on the continued success of its global partner infrastructure network with a cloud collaboration relationship with Oracle HCM and by driving ongoing momentum of its alliance with NGA Human Resources, which led to several significant deals in the quarter, including a large SaaS solution for a multinational chemicals and biotechnology company based in Switzerland.
- Kronos InTouch remains a critical component to a comprehensive, global workforce management solution, with hardware bookings increasing nearly 30 percent. Simultaneously, organizations worldwide are providing employees with more control, as about 8 million workers now have access to a Kronos mobile or tablet solution.
Workforce Solutions for All: Kronos Small and Midsize Business (SMB) Success Surges
Deals with small and midsize customers (under 2,500 employees) remain one of the companies’ fastest-growing and significant growth opportunities.
- North American product bookings for HCM and workforce management solutions at SMB organizations increased 22 percent in the quarter over last year.
- Kronos celebrated five years of explosive partner network growth and small business success by transforming Kronos SaaShr into the Kronos Workforce Ready Partner Network. Since its acquisition by Kronos in 2012, SaaShr has grown from a $5 million business to what today exceeds $100 million in annual revenue.
Healthcare, Manufacturing Have Record Quarters Driven by Award-Winning Customer Service
Kronos’ vertical strategy for sales and professional services continues to be a key differentiator, as customers benefit from optimized solutions for their specific industry.
- The healthcare vertical set an all-time high for success with 27 percent growth, including Foundation Health Partners deploying in the Kronos Cloud, and manufacturing also had its best-ever quarter for product bookings, growing by nearly 17 percent year-over-year.
- For the 17th consecutive year, Omega Management Group Corp. presented Kronos with the NorthFace ScoreBoard Award® for delivering exceptional customer service supporting HCM and workforce management solutions.
Employee Engagement Climbs to Record Heights, Inspired by Great Leaders
Kronites around the world are more inspired and energized than ever before, as employee engagement at Kronos climbed to new heights – up to 87 percent – while the remarkable momentum of employer of choice and leadership accolades continued to grow for the company’s culture of caring.
- Beyond landing on Glassdoor’s Highest Rated CEOs list for the second consecutive year, CEO Aron Ain was honored with the inaugural Ray Stata Leadership and Innovation Award by the Massachusetts High Technology Council.
- Kronos Chief People Officer David Almeda was named Chief Human Resources Officer (CHRO) of the Year by HRO Today.
- Kronos was awarded four more distinctions for its WorkInspired culture in the third quarter, as Forbes named Kronos a Best Employer for the 3rd consecutive year; The Globe and Mail ranked Kronos the 8th best place to work in all of Canada; the Boston Business Journal listed Kronos as a top-three Best Place to Work for the 3rd year in-a-row; and the Montreal Gazette honored Kronos as part of the annual Canada’s Top 100 Employers competition.
- Kronos celebrated the 5th anniversary of opening its Indianapolis Technology Center of Excellence, now the company’s global hub for professional services and software implementation.
Kronos Experts Show Employee Engagement, Evidence-Based HR are Strategic Weapons
Kronos thought leaders continue to provide organizations with resources, research, and insights to help create and manage an engaged workforce for stronger business success.
- Gregg Gordon, vice president of the Data Science Practice Group at Kronos, launched his new book, Your Last Differentiator: Human Capital, at the Society for Human Resources Management (SHRM) Annual Conference & Expo, providing organizations with advice on holistically developing their workforces and improving the employee experience to drive better business outcomes.
- Also at SHRM’s conference, Kronos Chief People Officer David Almeda and Vice President of Global Talent Acquisition Kristen Brown were featured speakers in the accredited session, "Make HR a Strategic Weapon for Your Organization: An Evidence-Based Approach."
- Kronos released three additional pieces of research in the quarter to help organizations, HR leaders, and people managers further understand that high employee engagement and high performance are not mutually exclusive:
- "Employee Engagement in Nursing" found nurses love what they do but fatigue is pervasive;
- A study with Future Workplace® showed the critical importance of employee engagement in the financial industry, as banking, insurance, and asset management organizations struggle to attract, engage, and retain employees in the current hyper-competitive environment; and
- The Workforce Institute at Kronos found that issues with payroll could have a far more negative impact on engagement than previously thought, as about half of Americans would begin searching for a new job after just two issues with their paycheck.