Workday Announces Fiscal 2026 Third Quarter Financial Results

Core Insights - Workday reported total revenues of $2.432 billion for the fiscal 2026 third quarter, representing a year-over-year increase of 12.6% [7] - Subscription revenues reached $2.244 billion, up 14.6% year-over-year [7] - The company anticipates fiscal 2026 subscription revenue of $8.828 billion, reflecting a growth of 14% [3] Financial Performance - Operating income for the third quarter was $259 million, or 10.7% of revenues, compared to $165 million, or 7.6% of revenues, in the same period last year [7] - Non-GAAP operating income was $692 million, or 28.5% of revenues, compared to $569 million, or 26.3% of revenues, in the same period last year [7] - Diluted net income per share was $0.94, up from $0.72 in the third quarter of fiscal 2025 [7] - Non-GAAP diluted net income per share was $2.32, compared to $1.89 in the same period last year [7] Subscription Backlog - The 12-month subscription revenue backlog was $8.21 billion, an increase of 17.6% year-over-year [7] - Total subscription revenue backlog reached $25.96 billion, increasing 17.0% year-over-year [7] Cash Flow and Share Repurchase - Operating cash flows were $588 million, compared to $406 million in the same period last year [7] - Free cash flows amounted to $550 million, up from $359 million in the same period last year [7] - Workday repurchased approximately 3.4 million shares of Class A common stock for $803 million as part of its share repurchase programs [7] Business Developments - Workday announced a new AI Centre of Excellence in Dublin, Ireland, with a three-year investment of €175 million and the creation of 200 specialized AI roles [5] - The company welcomed new customers and expanded existing relationships, including notable wins in the healthcare sector [8] - Workday unveiled several new innovations at its annual customer conference, including new AI agents and a new data layer [8] Market Position - Workday was named a Leader in the 2025 Gartner Magic Quadrant for Cloud HCM Suites for 1,000+ Employee Enterprises, Cloud ERP for Service-Centric Enterprises, and Cloud ERP Finance [8]