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Workday, Inc. (NASDAQ: WDAY), the AI platform for managing people and money, announced results for the fiscal 2025 fourth quarter and full year ended January 31, 2025.
Fiscal 2025 Fourth Quarter Results
- Total revenues were $2.211 billion, an increase of 15.0% from the fourth quarter of fiscal 2024. Subscription revenues were $2.040 billion, an increase of 15.9% from the same period last year.
- Operating income was $75 million, or 3.4% of revenues, compared to an operating income of $79 million, or 4.1% of revenues, in the same period last year. Operating income in the fourth quarter of fiscal 2025 was impacted by restructuring expenses of $75 million. Non-GAAP operating income for the fourth quarter was $584 million, or 26.4% of revenues, compared to a non-GAAP operating income of $462 million, or 24.0% of revenues, in the same period last year.1
- Diluted net income per share was $0.35, compared to diluted net income per share of $4.42 in the fourth quarter of fiscal 2024. Net income per share in the fourth quarter of fiscal 2025 was impacted by restructuring expenses of $75 million, while the prior year period benefited from a $1.1 billion release of the valuation allowance related to U.S. federal and state deferred tax assets. Non-GAAP diluted net income per share was $1.92, compared to non-GAAP diluted net income per share of $1.57 in the same period last year.1
Fiscal Year 2025 Results
- Total revenues were $8.446 billion, an increase of 16.4% from fiscal 2024. Subscription revenues were $7.718 billion, an increase of 16.9% from the prior year.
- Operating income was $415 million, or 4.9% of revenues, compared to an operating income of $183 million, or 2.5% of revenues, in fiscal 2024. Operating income in fiscal 2025 was impacted by restructuring expenses of $84 million. Non-GAAP operating income was $2.186 billion, or 25.9% of revenues, compared to a non-GAAP operating income of $1.741 billion, or 24.0% of revenues, in the prior year.1
- Diluted net income per share was $1.95, compared to diluted net income per share of $5.21 in fiscal 2024. Net income per share in fiscal 2025 was impacted by restructuring expenses of $84 million, while the prior year benefited from a $1.1 billion release of the valuation allowance related to U.S. federal and state deferred tax assets. Non-GAAP diluted net income per share was $7.30, compared to non-GAAP diluted net income per share of $5.90 in the same period last year.1
- 12-month subscription revenue backlog was $7.63 billion, up 15.2% from the same period last year. Total subscription revenue backlog was $25.06 billion, increasing 19.7% year-over-year.
- Operating cash flows were $2.461 billion compared to $2.149 billion in the prior year. Free cash flows were $2.192 billion compared to $1.917 billion in the prior year.1
- Workday repurchased approximately 2.9 million shares of Class A common stock for $700 million as part of its share repurchase programs.
- Cash, cash equivalents, and marketable securities were $8.02 billion as of January 31, 2025.
Comments on the News
“Our fourth quarter performance is a testament to Workday’s value proposition as organizations seek to boost productivity, run more efficiently, and deliver incredible employee experiences,” said Carl Eschenbach, CEO, Workday. “Workday’s unified platform gives customers the ultimate advantage—helping them unlock value faster, reduce total cost of ownership, and harness the power of AI across our best-in-class HR and finance solutions.”
“Our fourth quarter results were driven by solid performance across key growth areas of the business, including continued momentum with our full suite and financials products, growing demand for our AI SKUs, and strong execution across industry verticals,” said Zane Rowe, CFO, Workday. “We continue to expect fiscal 2026 subscription revenue of $8.800 billion, representing 14% growth, and we now expect fiscal 2026 non-GAAP operating margin of approximately 28.0%. We are focused on investing to support long-term growth, while driving efficiencies in the business.”
Recent Highlights
- Workday announced the Workday Agent System of Record, which will enable organizations to manage their entire fleet of AI agents in one place. Workday also announced new role-based Illuminate agents for Payroll, Contracts, Financial Auditing, and Policy.
- Workday named Gerrit Kazmaier as president, product and technology, and announced Sayan Chakraborty’s retirement from the company.
- Workday is now used by more than 11,000 organizations around the world, including approximately 30% of the Forbes Global 2000.
- Workday welcomed new core customers including First-Citizens Bank & Trust, St. Louis County, UnityPoint Health, and Vermont State College System and expanded existing relationships with Aon, Sallie Mae Bank, Sutter Health, and Toyota.
- Workday added new strategic partnerships with Randstad and TechWolf, and added five new Workday Wellness partners, including MetLife.
- Workday hosted Rising EMEA, the company’s annual EMEA user conference with more than 5,000 attendees, and unveiled new Illuminate capabilities in Workday Peakon Employee Voice to unlock deeper and faster employee insights with AI.
- Workday announced the availability of Workday Student in Australia and New Zealand, marking the product’s first global launch outside of North America.
- KLAS Research named Workday as Best in KLAS 2025 in enterprise resource planning (ERP) for large organizations for the eighth year in a row.
Financial Outlook
- Workday is providing guidance for the fiscal 2026 first quarter ending April 30, 2025 as follows:
- Subscription revenue of $2.050 billion, representing growth of 13%
- Non-GAAP operating margin of 28.0%1
- Workday is providing guidance for the fiscal 2026 full year ending January 31, 2026 as follows:
- Subscription revenue of $8.800 billion, representing growth of 14%
- Non-GAAP operating margin of 28.0%1
WDAY stock price is trading around $266.
