Fiscal Third Quarter Total Revenues of $2.432 Billion, Up 12.6% Year-Over-Year
Subscription Revenues of $2.244 Billion, Up 14.6% Year-Over-Year
PLEASANTON, Calif., Nov. 25, 2025 /PRNewswire/ — Workday, Inc. (NASDAQ: WDAY), the enterprise AI platform for managing people, money, and agents, today announced results for the fiscal 2026 third quarter ended October 31, 2025.
Fiscal 2026 Third Quarter Results
Total revenues were $2.432 billion, an increase of 12.6% from the third quarter of fiscal 2025. Subscription revenues were $2.244 billion, an increase of 14.6% from the same period last year.Operating income was $259 million, or 10.7% of revenues, compared to an operating income of $165 million, or 7.6% of revenues, in the same period last year. Non-GAAP operating income for the third quarter was $692 million, or 28.5% of revenues, compared to a non-GAAP operating income of $569 million, or 26.3% of revenues, in the same period last year.1Diluted net income per share was $0.94, compared to diluted net income per share of $0.72 in the third quarter of fiscal 2025. Non-GAAP diluted net income per share was $2.32, compared to non-GAAP diluted net income per share of $1.89 in the same period last year.112-month subscription revenue backlog was $8.21 billion, up 17.6% from the same period last year. Total subscription revenue backlog was $25.96 billion, increasing 17.0% year-over-year. 12-month subscription revenue backlog and total subscription revenue backlog include the impact from the acquisition of Paradox, which closed in the third quarter of fiscal 2026.Operating cash flows were $588 million compared to $406 million in the same period last year. Free cash flows were $550 million compared to $359 million in the same period last year.1Workday repurchased approximately 3.4 million shares of Class A common stock for $803 million as part of its share repurchase programs.Cash, cash equivalents, and marketable securities were $6.84 billion as of October 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, fueled by the strength and diversity of our business and the momentum we’re seeing across our AI portfolio,” said Carl Eschenbach, CEO, Workday. “By unifying people, money, and AI agents on one trusted platform, we’re giving customers a real edge — helping them empower their people, simplify how work gets done, and drive results that truly matter.”
“Our Q3 results were driven by continued progress across several key growth initiatives, as we accelerate innovation across the platform and bring exciting AI solutions to market,” said Zane Rowe, CFO, Workday. “We now expect fiscal 2026 subscription revenue of $8.828 billion, growth of 14%, and non-GAAP operating margin of approximately 29%.”
Recent Business Highlights
Workday welcomed new customers including County of San Luis Obispo, Fuji Electric Co. Ltd., Hoshino Resorts Inc., Kelly Services, and The Magnum Ice Cream Company, and expanded existing relationships with CommonSpirit Health, Cornell University, DBS Bank, Guardian Life Insurance Company of America, IMA Financial Group, Levi Strauss & Co, Northeast Georgia Medical Center, and Novartis.The U.S. Department of Energy went live on Workday Government — the first cabinet-level agency to bring its core HR systems into a FedRAMP-authorized cloud.Healthcare became Workday’s sixth industry to cross $1 billion in annual recurring revenue, driven by notable wins and go-lives including Advocate Health and Ardent Health.At its annual customer conference, Workday Rising, Workday unveiled several new innovations including:New Workday Illuminate™ AI agentsWorkday Data Cloud, a new data layerWorkday Build, a new open developer experienceWorkday Flex Credits, a new, transparent subscription-based consumption model for AIWorkday announced a new AI Centre of Excellence in Dublin, Ireland, with a three-year €175 million investment and the creation of 200 specialized AI roles.Workday closed the acquisitions of Paradox, a candidate experience agent that uses conversational AI to simplify every step of the job application journey, and Sana, a leading AI company building the next generation of enterprise knowledge tools.Workday formed a new partnership with Microsoft to help organizations securely manage their people and AI agents across their platform.Workday announced Pay Transparency Analyzer powered by Kainos, which helps organizations navigate global pay equity regulations, including the EU Pay Transparency Directive; announced an expansion of the Workday Agent Partner Network; and welcomed new partners to the Workday Wellness program — including Chime for financial benefits, Spring Health for mental wellness, and Strada for benefits admin.Workday was named a Leader in the 2025 Gartner® Magic Quadrant™ for Cloud HCM Suites for 1,000+ Employee Enterprises1, Cloud ERP for Service-Centric Enterprises2, and Cloud ERP Finance3.
1
Gartner Magic Quadrant for Cloud HCM Suites for 1,000+ Employee Enterprises, Josie Xing, Ranadip Chandra, Sam Grinter, Ron Hanscome, Chris Pang, Harsh Kundulli, David Bobo, Laura Gardiner, Michelle Shapiro, Anand Chouksey, Jackie Watrous, Stephanie Clement, Jeff Freyermuth, Chris Hester, 8 September 2025
2
Gartner Magic Quadrant for Cloud ERP for Service-Centric Enterprises, Robert Anderson, Johan Jartelius, Tomas Kienast, Sam Grinter, Denis Torii, Chaithanya Paradarami, 13 October 2025
3
Gartner Magic Quadrant Magic Quadrant for Cloud ERP Finance, Mike Helsel, Irmina Melarkode, Nick Duffy, Nisha Bhandare, 27 October 2025
Financial Outlook
Workday is providing guidance for the fiscal 2026 fourth quarter ending January 31, 2026 as follows:
Subscription revenues of $2.355 billion, representing growth of 15.5%Non-GAAP operating margin of at least 28.5%1
Workday is updating guidance for the fiscal 2026 full year ending January 31, 2026 as follows:
Subscription revenues of $8.828 billion, representing growth of 14.4%Non-GAAP operating margin of approximately 29%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 third 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 enterprise AI platform for managing people, money, and agents. Workday unifies HR and Finance on one intelligent platform with AI at the core to empower people at every level with the clarity, confidence, and insights they need to adapt quickly, make better decisions, and deliver outcomes that matter. 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 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 fourth quarter and full year fiscal 2026 subscription revenues and non-GAAP operating margin, momentum, growth, and innovation. 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) our ability to realize the expected business or financial benefits of any acquisitions of or investments in companies; (ix) the regulatory, economic, and political risks associated with our domestic and international operations; (x) 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; (xi) the regulatory risks related to new and evolving technologies such as AI and our ability to realize a return on our development efforts; (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)
October 31, 2025
January 31, 2025
Assets
Current assets:
Cash and cash equivalents
$ 2,609
$ 1,543
Marketable securities
4,234
6,474
Trade and other receivables, net
1,750
1,950
Deferred costs
286
267
Prepaid expenses and other current assets
296
311
Total current assets
9,175
10,545
Property and equipment, net
1,132
1,239
Operating lease right-of-use assets
721
336
Deferred costs, noncurrent
573
561
Acquisition-related intangible assets, net
549
361
Deferred tax assets
905
1,039
Goodwill
4,263
3,478
Other assets
433
418
Total assets
$ 17,751
$ 17,977
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable
$ 103
$ 108
Accrued expenses and other current liabilities
352
296
Accrued compensation
574
578
Unearned revenue
3,871
4,467
Operating lease liabilities
117
99
Total current liabilities
5,017
5,548
Debt, noncurrent
2,986
2,984
Unearned revenue, noncurrent
70
80
Operating lease liabilities, noncurrent
690
279
Other liabilities
109
52
Total liabilities
8,872
8,943
Stockholders’ equity:
Common stock
0
0
Additional paid-in capital
12,311
11,463
Treasury stock
(2,706)
(1,308)
Accumulated other comprehensive income (loss)
(69)
84
Accumulated deficit
(657)
(1,205)
Total stockholders’ equity
8,879
9,034
Total liabilities and stockholders’ equity
$ 17,751
$ 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 October 31,
Nine Months Ended October 31,
2025
2024
2025
2024
Revenues:
Subscription services
$ 2,244
$ 1,959
$ 6,473
$ 5,678
Professional services
188
201
547
557
Total revenues
2,432
2,160
7,020
6,235
Costs and expenses (1):
Costs of subscription services
395
329
1,115
924
Costs of professional services
196
201
595
606
Product development
666
647
1,988
1,952
Sales and marketing
677
620
1,941
1,804
General and administrative
234
198
662
600
Restructuring (2)
5
0
172
9
Total costs and expenses
2,173
1,995
6,473
5,895
Operating income
259
165
547
340
Other income, net
79
62
198
178
Income before provision for income taxes
338
227
745
518
Provision for income taxes
86
34
197
86
Net income
$ 252
$ 193
$ 548
$ 432
Net income per share, basic
$ 0.95
$ 0.73
$ 2.06
$ 1.63
Net income per share, diluted
$ 0.94
$ 0.72
$ 2.03
$ 1.61
Weighted-average shares used to compute net income per share, basic
265,870
265,411
266,387
265,062
Weighted-average shares used to compute net income per share, diluted
268,629
268,549
269,700
268,936
(1) Costs and expenses include share-based compensation expense as follows:
Three Months Ended October 31,
Nine Months Ended October 31,
2025
2024
2025
2024
Costs of subscription services
$ 39
$ 35
$ 120
$ 108
Costs of professional services
27
28
84
86
Product development
162
162
515
498
Sales and marketing
83
78
261
226
General and administrative
65
65
205
204
Restructuring
0
0
42
0
Total share-based compensation expense
$ 376
$ 368
$ 1,227
$ 1,122
(2)
In February 2025, Workday announced a restructuring plan (“Fiscal 2026 Restructuring Plan”) intended to prioritize its investments and continue advancing
its ongoing focus on durable growth. The plan reduced Workday’s workforce by approximately 7.5%. In connection with the plan, Workday has exited certain
owned office space. During the nine months ended October 31, 2025, Workday recorded expenses of $133 million for employee transition, severance
payments, employee benefits, and share-based compensation expense, and $39 million related to an impairment of office space
