Core Viewpoint - Workday's recent fiscal guidance has disappointed investors, leading to a decline in its stock price, which is down approximately 6% year-to-date despite strong S&P 500 performance [1][2] Financial Performance - For fiscal Q3 2025, Workday reported a 16% year-over-year revenue increase to $2.16 billion, with subscription revenue also rising 16% to $1.959 billion, slightly exceeding previous forecasts [3] - Adjusted earnings per share (EPS) increased by 21% to $1.89, surpassing the consensus estimate of $1.76 [3] - The company's operating cash flow was $406 million, and free cash flow was $359 million, ending the period with $7.16 billion in cash and marketable securities against $2.98 billion in debt [5] Future Guidance - Workday revised its full-year subscription revenue growth outlook to approximately $7.703 billion, indicating a growth rate of about 17% [6] - For fiscal Q4, the company expects subscription revenue of $2.025 billion, reflecting a 15% growth, and an adjusted operating margin of 25% [7] - Looking ahead to fiscal year 2026, Workday anticipates growth of about 14% to $8.8 billion with adjusted operating margins around 27.5% [8] Strategic Focus - The company is increasingly leveraging artificial intelligence (AI), with 30% of customer expansions in the quarter attributed to AI solutions [4] - Workday aims to penetrate the government sector, targeting outdated on-premise systems for cloud migration, which could enhance efficiency and reduce costs [10] Valuation Metrics - Workday's forward price-to-sales (P/S) ratio is 7.2, and the forward price-to-earnings (P/E) ratio is just over 31 based on fiscal 2026 estimates, which is considered appropriate given its growth outlook [11] - The company is focused on maintaining mid-teens revenue growth while expanding operating margins, projecting an increase from 25.5% this year to 27.5% next year [13] Investment Consideration - If Workday achieves its forecasted growth and margin expansion, it could see strong earnings growth, which may positively impact its stock price [14]

Workday Inc. (WDAY) , a leading provider of enterprise-level software solutions for financial management and human resource domains, reported better-than-expected fiscal third-quarter results. Non-GAAP earnings of $1.89 per share surpassed the Zacks Consensus Estimate by 17 cents.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Revenues surged 16% year over year to $2.16 billion. The figure surpassed the Zacks Consensus Estimate by $33 million. Healthy traction in multiple verticals ...

Workday, Inc. (WDAY) recorded strong Subscription revenues in the recently released third-quarter fiscal 2025 results. This portrayed the strength of its existing customer relationships across industries and the growing clout of its artificial intelligence (AI) innovations as more organizations are consolidating on the Workday platform.Subscription services revenues totaled $1.96 billion, up from $1.69 billion in the year-ago quarter. At the fiscal third-quarter end, the 12-month subscription revenue backlo ...

I recently joined The REIT Forum and if you are looking for more investment ideas like this one, get them exclusively at The REIT Forum with access to our subscriber only portfolios.I l ast covered Workday (NASDAQ: WDAY ), where I reiterated my “buy” rating after upgrading the stock back in June . While the stock has more or less performed at par withAmrita runs a boutique family office fund in beautiful Vancouver, where she leads the investment strategy for the family fund. The fund's objective is to inves ...

Key TakeawaysWorkday gave weaker-than-anticipated guidance for fiscal 2025 subscription services revenue, sending shares tumbling.The company beat third quarter profit and sales estimates.Workday said artificial intelligence-driven innovations and its "partner ecosystem" helped boost results. Shares of Workday (WDAY) sank 8% Wednesday, a day after the human resources software firm predicted weaker-than-expected full-year subscription services revenue.  The company sees fiscal 2025 subscription services reve ...

Workday, Inc. (WDAY) reported strong third-quarter fiscal 2025 results, with adjusted earnings and revenues surpassing the respective Zacks Consensus Estimate. Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.The company reported revenue growth year over year, driven by solid customer wins across various industries, including education, financials, healthcare and more. Strategic expansions and strong contract renewals within the existing customer base also drove the top line. Managem ...

Workday Inc (NASDAQ:WDAY) and Autodesk Inc (NASDAQ:ADSK) are fresh out of the earnings confessional. Both software companies beat third-quarter earnings and revenue expectations, but their fiscal fourth-quarter guidance came in below estimates. The latter also revealed Janesh Moorjani will take over as its chief financial officer, effective Dec. 16.WDAY was last seen 9.1% lower to trade at $245.51, on track for its worst single-day percentage loss since May, as well as its third loss in the last four sessi ...

Key TakeawaysWorkday posted better-than-expected third-quarter results but provided a current-quarter subscription revenue outlook below Wall Street expectations, sending shares in the software maker sharply lower in early trading on Wednesday.A bearish divergence has formed between the stock's November peak and the relative strength index, a technical occurrence that signals weakening buying momentum.Investors should monitor important support areas on Workday's chart around $237, $223, and $207 while also ...

Financial Data and Key Metrics Changes - Subscription revenue in Q3 was $1.959 billion, reflecting a 16% increase year-over-year [29] - Total revenue for the quarter reached $2.160 billion, also up 16% [29] - Non-GAAP operating income was $569 million, resulting in a non-GAAP operating margin of 26.3% [30] - The 12-month subscription revenue backlog (cRPO) was $6.98 billion, increasing by 15% [29] - Total subscription revenue backlog at the end of the quarter was $22.19 billion, up 20% [29] Business Line Data and Key Metrics Changes - Professional services revenue was $201 million, contributing to the total revenue growth [29] - More than 35% of new core customers in Q3 opted for the full suite of services [13] - The healthcare sector saw significant wins, including a major deal with CommonSpirit Health [12] Market Data and Key Metrics Changes - US revenue totaled $1.62 billion, while international revenue was $537 million, both growing at 16% [29] - The professional and business services sector became the third industry to exceed $1 billion in annual recurring revenue [11] - Government and higher education sectors showed strong performance, with 90% of wins in these industries being full suite [10] Company Strategy and Development Direction - The company aims for mid-teens subscription revenue growth through FY27 while expanding non-GAAP operating margins to 30% [27] - Focus on AI solutions is a key part of the strategy, with over 30% of customer expansions involving AI products [14] - The company is investing in its Financials business to drive demand for the full suite [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the federal government market, noting a significant opportunity as many systems remain on-premises [49] - The company anticipates a strong Q4 with a solid pipeline and expects to maintain its growth trajectory despite economic headwinds [75] - Management highlighted the importance of AI in driving future growth and customer engagement [62] Other Important Information - The company repurchased $157 million of its shares during the quarter [30] - The acquisition of Evisort, a document intelligence platform, was completed, enhancing AI capabilities [20] - A new strategic partnership was formed with NTT Data in Japan, expanding international growth opportunities [24] Q&A Session Summary Question: Can you discuss the deliverable issue in Q4 and its impact on FY26 guidance? - Management noted that strategic deals in Q3 had product deliverables that would affect revenue recognition, expecting a ramp-up in FY26 [38][39] Question: How is the federal business responding to government efficiency plans? - Management believes the focus on efficiency will drive demand for cloud solutions, positioning the company favorably in the federal market [49] Question: What is the outlook for employment indicators in the customer base? - Management indicated no significant changes in employment indicators but noted a moderation in expectations [52] Question: How confident is the company in maintaining mid-teen growth rates? - Management expressed confidence due to strong Q3 performance, AI momentum, and strategic partnerships [61][62] Question: What is the company's approach to AI monetization? - The company takes a multipronged approach, integrating AI into core offerings and pricing based on customer value [110][112]

Workday (WDAY) came out with quarterly earnings of $1.89 per share, beating the Zacks Consensus Estimate of $1.72 per share. This compares to earnings of $1.53 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 9.88%. A quarter ago, it was expected that this maker of human resources software would post earnings of $1.63 per share when it actually produced earnings of $1.75, delivering a surprise of 7.36%.Over the last four quarte ...