Fiscal Second Quarter Total Revenues of $2.348 Billion, Up 12.6% Year-Over-Year
Subscription Revenues of $2.169 Billion, Up 14.0% Year-Over-Year
PLEASANTON, Calif., Aug. 21, 2025 /PRNewswire/ — Workday, Inc. (NASDAQ: WDAY), the AI platform for managing people, money, and agents, today announced results for the fiscal 2026 second quarter ended July 31, 2025.
Fiscal 2026 Second Quarter Results
Total revenues were $2.348 billion, an increase of 12.6% from the second quarter of fiscal 2025. Subscription revenues were $2.169 billion, an increase of 14.0% from the same period last year.Operating income was $248 million, or 10.6% of revenues, compared to an operating income of $111 million, or 5.3% of revenues, in the same period last year. Non-GAAP operating income for the second quarter was $680 million, or 29.0% of revenues, compared to a non-GAAP operating income of $518 million, or 24.9% of revenues, in the same period last year.1Diluted net income per share was $0.84, compared to diluted net income per share of $0.49 in the second quarter of fiscal 2025. Non-GAAP diluted net income per share was $2.21, compared to non-GAAP diluted net income per share of $1.75 in the same period last year.112-month subscription revenue backlog was $7.91 billion, up 16.4% from the same period last year. Total subscription revenue backlog was $25.37 billion, increasing 17.6% year-over-year.Operating cash flows were $616 million compared to $571 million in the same period last year. Free cash flows were $588 million compared to $516 million in the same period last year.1Workday repurchased approximately 1.2 million shares of Class A common stock for $299 million as part of its share repurchase programs.Cash, cash equivalents, and marketable securities were $8.19 billion as of July 31, 2025.
1
See the section titled “About Non-GAAP Financial Measures” in the accompanying financial tables for further details.
Comments on the News
“Workday delivered another solid quarter, driven by our AI and platform innovation, international momentum, and an ecosystem that continues to grow alongside us,” said Carl Eschenbach, CEO, Workday. “Customers are choosing Workday because we help them unlock value today and prepare for what’s next — whether that’s navigating AI transformation, streamlining operations, or creating more meaningful work for their people.”
“Our second quarter results reflect the strength of our platform and our continued progress across several of our growth initiatives,” said Zane Rowe, CFO, Workday. “Following our first half momentum – and also incorporating the acquisition of Paradox — we are increasing our fiscal 2026 subscription revenue guidance to $8.815 billion, representing growth of 14%, and increasing our fiscal 2026 non-GAAP operating margin guidance to approximately 29%.”
Recent Business Highlights
Workday welcomed new customers including Banamex, Carrefour, Masan Group, Memorial Health, and Red Coats, and expanded existing relationships with Google, Nationwide Insurance, Qantas Airways, Randstad, Tokyo Electron, and University of Virginia.Workday entered into a definitive agreement to acquire Paradox, a candidate experience agent that uses conversational AI to simplify every step of the job application journey, and acquired Flowise, a low-code platform that makes it easy to build AI agents.Workday unveiled a new AI developer toolset and introduced the Workday Agent Partner Network, a global ecosystem of partners building AI agents that will connect with the Workday Agent System of Record.Workday launched Workday Government, a new subsidiary dedicated to serving the U.S. Government.The Workday customer community now represents more than 75 million users under contract and more than 65% of the Fortune 500.DailyPay was named Workday’s strategic partner for on-demand pay, giving employees easier access to earned wages before payday.Workday grew its presence in India with an expanded team, including the appointment of Sunil Jose as President of India, and a commitment to offer services from a local data center.Workday was named a Leader in the 2025 Gartner® Magic Quadrant™ for Cloud-Based ERP for U.S. Local Government1.Workday VNDLY was named a Leader and Star Performer in Everest Group’s Vendor Management Systems (VMS) PEAK Matrix® Assessment 2025.Workday was named a Customers’ Choice in the 2025 Gartner® Peer Insights™ Voice of the Customer for Cloud ERP for Service-Centric Enterprises2, Financial Planning Software3, and Cloud HCM Suites for 1,000+ Employee Enterprises4.
1
Gartner Magic Quadrant for Cloud-Based ERP for U.S. Local Government, Albert Gauthier, Robert Stoneman, Todd Kimbriel, 19 May 2025
2
Gartner Voice of the Customer for Cloud ERP for Service-Centric Enterprises, By Peer Contributors, 23 May 2025
3
Gartner Voice of the Customer for Financial Planning Software, By Peer Contributors, 30 May 2025
4
Gartner Voice of the Customer for Cloud HCM Suites for 1,000+ Employee Enterprises, By Peer Contributors, 23 May 2025
Financial Outlook
Workday is providing guidance for the fiscal 2026 third quarter ending October 31, 2025 as follows:
Subscription revenues of $2.235 billion, representing growth of 14.1%Non-GAAP operating margin of 28.0%1
Workday is updating guidance for the fiscal 2026 full year ending January 31, 2026 as follows:
Subscription revenues of $8.815 billion, representing growth of 14.2%Non-GAAP operating margin of 29.0%1
1
The Company has not provided a reconciliation of its forward outlook for non-GAAP operating margin with its forward-looking GAAP operating margin in
reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K. The Company is unable to predict with reasonable
certainty the amount and timing of adjustments that are used to calculate this non-GAAP financial measure, particularly related to stock-based compensation
and its related tax effects, acquisition-related costs, and restructuring costs.
Earnings Call Details
Workday plans to host a conference call today to review its fiscal 2026 second quarter financial results and to discuss its financial outlook. The call is scheduled to begin at 1:30 p.m. PT/4:30 p.m. ET and can be accessed via webcast. The webcast will be available live, and a replay will be available following completion of the live broadcast for approximately 90 days.
Workday uses the Workday Blog as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.
About Workday
Workday is the AI platform for managing people, money, and agents. The Workday platform is built with AI at the core to help customers elevate people, supercharge work, and move their business forever forward. Workday is used by more than 11,000 organizations around the world and across industries – from medium-sized businesses to more than 65% of the Fortune 500. For more information about Workday, visit workday.com.
© 2025 Workday, Inc. All rights reserved. Workday and the Workday logo are registered trademarks of Workday, Inc. All other brand and product names are trademarks or registered trademarks of their respective holders.
Forward-Looking Statements
This press release contains forward-looking statements including, among other things, statements regarding Workday’s planned acquisition of Paradox, Workday’s third quarter and full year fiscal 2026 subscription revenues and non-GAAP operating margin, momentum, and growth. These forward-looking statements are based only on currently available information and our current beliefs, expectations, and assumptions. Because forward-looking statements relate to the future, they are subject to risks, uncertainties, assumptions, and changes in circumstances that are difficult to predict and many of which are outside of our control. If the risks materialize, assumptions prove incorrect, or we experience unexpected changes in circumstances, actual results could differ materially from the results implied by these forward-looking statements, and therefore you should not rely on any forward-looking statements. Risks include, but are not limited to: (i) breaches in our security measures or those of our third-party providers, unauthorized access to our customers’ or other users’ personal data, or disruptions in our data center or computing infrastructure operations; (ii) service outages, delays in the deployment of our applications, and the failure of our applications to perform properly; (iii) privacy concerns and evolving domestic or foreign laws and regulations; (iv) the impact of continuing global economic and geopolitical volatility on our business, as well as on our customers, prospects, partners, and service providers; (v) any loss of key employees or the inability to attract, train, and retain highly skilled employees; (vi) competitive factors, including pricing pressures, industry consolidation, entry of new competitors and new applications, advancements in technology, and marketing initiatives by our competitors; (vii) our reliance on our network of partners to drive additional growth of our revenues; (viii) the regulatory, economic, and political risks associated with our domestic and international operations; (ix) adoption of our applications and services by customers and individuals, including any new features, enhancements, and modifications, as well as our customers’ and users’ satisfaction with the deployment, training, and support services they receive; (x) the regulatory risks related to new and evolving technologies such as AI and our ability to realize a return on our development efforts; (xi) our ability to realize the expected business or financial benefits of any acquisitions of or investments in companies; (xii) delays or reductions in information technology spending; (xiii) adverse litigation results; and (xiv) changes in sales, which may not be immediately reflected in our results due to our subscription model. Further information on these and additional risks that could affect Workday’s results is included in our filings with the Securities and Exchange Commission (“SEC”), including our most recent report on Form 10-Q or Form 10-K and other reports that we have filed and will file with the SEC from time to time, which could cause actual results to vary from expectations. Workday assumes no obligation to, and does not currently intend to, update any such forward-looking statements after the date of this release, except as required by law.
Any unreleased services, features, or functions referenced in this document, our website, or other press releases or public statements that are not currently available are subject to change at Workday’s discretion and may not be delivered as planned or at all. Customers who purchase Workday services should make their purchase decisions based upon services, features, and functions that are currently available.
Workday, Inc.
Condensed Consolidated Balance Sheets
(in millions)
(unaudited)
July 31, 2025
January 31, 2025
Assets
Current assets:
Cash and cash equivalents
$ 1,264
$ 1,543
Marketable securities
6,922
6,474
Trade and other receivables, net
1,609
1,950
Deferred costs
278
267
Prepaid expenses and other current assets
334
311
Total current assets
10,407
10,545
Property and equipment, net
1,121
1,239
Operating lease right-of-use assets
719
336
Deferred costs, noncurrent
562
561
Acquisition-related intangible assets, net
320
361
Deferred tax assets
959
1,039
Goodwill
3,478
3,478
Other assets
395
418
Total assets
$ 17,961
$ 17,977
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable
$ 100
$ 108
Accrued expenses and other current liabilities
346
296
Accrued compensation
537
578
Unearned revenue
3,852
4,467
Operating lease liabilities
110
99
Total current liabilities
4,945
5,548
Debt, noncurrent
2,985
2,984
Unearned revenue, noncurrent
65
80
Operating lease liabilities, noncurrent
681
279
Other liabilities
113
52
Total liabilities
8,789
8,943
Stockholders’ equity:
Common stock
0
0
Additional paid-in capital
12,055
11,463
Treasury stock
(1,900)
(1,308)
Accumulated other comprehensive income (loss)
(74)
84
Accumulated deficit
(909)
(1,205)
Total stockholders’ equity
9,172
9,034
Total liabilities and stockholders’ equity
$ 17,961
$ 17,977
Workday, Inc.
Condensed Consolidated Statements of Operations
(in millions, except number of shares which are reflected in thousands and per share data)
(unaudited)
Three Months Ended July 31,
Six Months Ended July 31,
2025
2024
2025
2024
Revenues:
Subscription services
$ 2,169
$ 1,903
$ 4,228
$ 3,719
Professional services
179
182
360
356
Total revenues
2,348
2,085
4,588
4,075
Costs and expenses (1):
Costs of subscription services
370
304
720
594
Costs of professional services
212
207
399
406
Product development
660
649
1,322
1,305
Sales and marketing
641
611
1,264
1,184
General and administrative
216
202
429
403
Restructuring (2)
1
1
167
8
Total costs and expenses
2,100
1,974
4,301
3,900
Operating income
248
111
287
175
Other income, net
56
57
120
116
Income before provision for income taxes
304
168
407
291
Provision for income taxes
76
36
111
52
Net income
$ 228
$ 132
$ 296
$ 239
Net income per share, basic
$ 0.86
$ 0.50
$ 1.11
$ 0.90
Net income per share, diluted
$ 0.84
$ 0.49
$ 1.09
$ 0.89
Weighted-average shares used to compute net income per share, basic
266,777
265,317
266,649
264,885
Weighted-average shares used to compute net income per share, diluted
270,180
267,949
270,240
269,128
(1) Costs and expenses include share-based compensation expense as follows:
Three Months Ended July 31,
Six Months Ended July 31,
2025
2024
2025
2024
Costs of subscription services
$ 39
$ 35
$ 81
$ 73
Costs of professional services
28
28
58
59
Product development
170
163
353
336
Sales and marketing
84
77
177
149
General and administrative
70
67
140
138
Restructuring
0
0
42
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