Workiva Navigates Near-Term Sustainability Software Market Challenges; Overall Business Remains Strong

Despite some headwinds in the sustainability software market, Workiva's overall business continues to accelerate, CEO Julie Iskow told Wall Street analysts during Workiva's Q2 2025 earnings call on July 31, 2025.

Workiva's software platform assists customers with financial reporting, sustainability management, audit, risk and more. The platform includes carbon accounting software, which is based on Workiva's $100 million Sustain.Life acquisition from 2024. 

Sustainability Software: Some Market Headwinds

Workiva Carbon experienced strong demand in late 2024, but the company saw "softer demand" in certain sustainability segments in Q2 of 2025, according to Workiva's earnings call.

More specifically, "We saw a dynamic market throughout the quarter [for sustainability software], influenced by shifting political policies, proposed regulatory changes and softer demand in certain segments," Iskow told analysts.

Indeed, the U.S. federal government has rolled back and/or abandoned various climate initiatives since President Donald Trump's second term began in January 2025. Amid that backdrop, some Workiva rivals are struggling to maintain market momentum, while others are struggling to find new rounds of funding.

Workiva Sustainability Software: Recent Customer Wins

Still, Workiva remains upbeat about the longer-term sustainability software market opportunity. Iskow said: "While the strong momentum we saw in the latter half of 2024 has tapered some, sustainability continues to drive both new logo wins and account expansion. In these deals, there continue to be many buying drivers, including business performance, managing stakeholder expectations and yes, regulations such as the CSRD, ISSB and the state of California climate disclosure rule."

Workiva's sustainability software wins in Q2 of 2025 included:

• A Top Five U.S. bank that signed a six-figure account expansion deal for sustainability reporting and CSRD;
• a Top Five global investment firm signed a mid-six-figure expansion deal with the addition of sustainability to assist ESG reporting across multiple countries; and
• a European multinational manufacturing company that signed a six-figure sustainability reporting and sustainability assurance deal as part of a CSRD compliance strategy, the software provider said.

Workiva did not mention the customers by name. Also, the company did not mention if channel partners or global systems integrators were involved in the deals. Still, Iskow emphasized Workiva's "high-performing partner ecosystem" throughout the earnings call.

Workiva Overall Business Momentum, Amplify 2025 Conference

While Workiva wants to capitalize on longer-term sustainability trends, the company also is striving to put its near-term market exposure in context. Iskow noted: "I do want to make it clear that while sustainability remains a strategic part of our business, it is less than 15% of our total revenue." Also, Workiva has already factored various market risks and challenges into its updated revenue guidance as of July 2025, she noted.

The overall Workiva business appears strong. Total revenue for the second quarter of 2025 reached $215 million, up 21% from $178 million in the second quarter of 2024, the company said. Also, GAAP net loss for the second quarter of 2025 was $(19) million compared with a net loss of $(18) million for Q2 of 2024.

So what's next? Workiva Amplify 2025, the company's customer and partner conference, is scheduled for September 8-10 in Washington, D.C. We'll be watching and listening for more sustainability software updates there.

Sustainability Software: Market Growth, Consolidation and Competition

More than 30 companies offer various ESG, sustainability and carbon accounting software packages. The market headwinds could trigger more M&A (merger and acquisition) activity, Sustainable Tech Partner believes. Recent deals include:

• Green Project Technologies buying Emitwise in July 2025.
• Ecologi acquired Net Zero Now in February 2025.

Despite the recent sustainability market headwinds, the global ESG software market is expected to reach $2.73 billion by 2030, up from $940.7 million in 2023, according to Grand View Research. That's a 17.3% compound annual growth rate (CAGR).