Workday Announces Fiscal 2027 First Quarter Financial Results
Fiscal First Quarter Total Revenues of $2.542 Billion, Up 13.5% Year-Over-Year
Subscription Revenues of $2.354 Billion, Up 14.3% Year-Over-Year
PLEASANTON, Calif., May 21, 2026 /PRNewswire/ -- Workday, Inc. (NASDAQ: WDAY), the enterprise AI platform for HR, finance, and IT, today announced results for the fiscal 2027 first quarter ended April 30, 2026.
Fiscal 2027 First Quarter Results
1 See the section titled "About Non-GAAP Financial Measures" in the accompanying financial tables for further details.
Comments on the News
"We had a great Q1, and it makes one thing clear: Workday is ready for this AI moment. Our core business is strong, our AI strategy is working, and we're moving with the speed and focus required to lead," said Aneel Bhusri, co-founder, CEO, and chair, Workday. "I am very excited about Workday's position and our path ahead. We have the platform, the trust, and the innovation to lead this next chapter, just as we did when we founded the company."
"Our first quarter results demonstrate ongoing customer adoption across our platform, as enterprises around the globe turn to Workday to manage and empower their most important assets," said Zane Rowe, CFO, Workday. "We are reiterating our fiscal 2027 subscription revenue outlook of $9.925 billion to $9.950 billion, while increasing our fiscal 2027 non-GAAP operating margin guidance to 30.5%. Our focus remains on executing on our agentic AI roadmap while driving operational efficiencies as we scale."
Recent Business Highlights
1
Gartner Voice of the Customer for Cloud ERP for Service-Centric Enterprises, Peer Community Contributor, 24 April 2026
2
Gartner Magic Quadrant for Higher Education SaaS Student Information Systems, Robert Yanckello, Grace Farrell, 31 March 2026
Financial Outlook
Workday is providing guidance for the fiscal 2027 second quarter ending July 31, 2026 as follows:
Workday is updating guidance for the fiscal 2027 full year ending January 31, 2027 as follows:
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 2027 first 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 its blog.workday.com website as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD.
About Workday
Workday operates at the heart of the enterprise – HR, finance, and IT – where the margin for error is effectively zero. By tightly coupling AI with the context, guardrails, and trusted processes that run the business, Workday goes beyond AI that assists with work to agents that are capable of driving measurable outcomes. More than 11,500 organizations worldwide, including more than 65% of the Fortune 500, trust Workday to deliver. For more information about Workday, visit workday.com.
© 2026 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 second quarter and full year fiscal 2027 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) competitive factors, including pricing pressures, industry consolidation, entry of new competitors and new applications, advancements in technology, and marketing initiatives by our competitors; (iv) privacy concerns and evolving domestic or foreign laws and regulations; (v) any loss of key employees or the inability to attract, train, and retain highly skilled employees; (vi) our reliance on our network of partners to drive additional growth of our revenues; (vii) the regulatory, economic, and political risks associated with our domestic and international operations; (viii) our ability to realize the expected business or financial benefits of any acquisitions of or investments in companies; (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) delays or reductions in information technology spending; (xii) adverse litigation results; (xiii) changes in sales, which may not be immediately reflected in our results due to our subscription model; and (xiv) the impact of continuing global economic and geopolitical volatility and conflicts on our business, as well as on our customers, prospects, partners, and service providers. 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)
April 30, 2026
January 31, 2026
Assets
Current assets:
Cash and cash equivalents
$ 559
$ 1,501
Marketable securities
3,794
3,942
Trade and other receivables, net
1,575
2,332
Deferred costs
307
306
Prepaid expenses and other current assets
357
348
Total current assets
6,592
8,429
Property and equipment, net
1,121
1,093
Operating lease right-of-use assets
706
719
Deferred costs, noncurrent
619
634
Acquisition-related intangible assets, net
645
681
Deferred tax assets
745
829
Goodwill
5,228
5,229
Other assets
435
460
Total assets
$ 16,091
$ 18,074
Liabilities and stockholders' equity
Current liabilities:
Accounts payable
$ 116
$ 142
Accrued expenses and other current liabilities
457
454
Accrued compensation
508
642
Unearned revenue
4,325
5,010
Operating lease liabilities
131
130
Debt, current
998
0
Total current liabilities
6,535
6,378
Debt, noncurrent
1,990
2,987
Unearned revenue, noncurrent
70
71
Operating lease liabilities, noncurrent
686
704
Other liabilities
127
129
Total liabilities
9,408
10,269
Stockholders' equity:
Common stock
0
0
Additional paid-in capital
12,932
12,673
Treasury stock
(5,834)
(4,220)
Accumulated other comprehensive loss
(125)
(136)
Accumulated deficit
(290)
(512)
Total stockholders' equity
6,683
7,805
Total liabilities and stockholders' equity
$ 16,091
$ 18,074
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 April 30,
2026
2025
Revenues:
Subscription services
$ 2,354
$ 2,059
Professional services
188
181
Total revenues
2,542
2,240
Costs and expenses (1):
Costs of subscription services
412
350
Costs of professional services
192
187
Product development
705
663
Sales and marketing
679
623
General and administrative
216
212
Restructuring
0
166
Total costs and expenses
2,204
2,201
Operating income
338
39
Other income, net
17
64
Income before provision for income taxes
355
103
Provision for income taxes
133
35
Net income
$ 222
$ 68
Net income per share, basic
$ 0.87
$ 0.25
Net income per share, diluted
$ 0.87
$ 0.25
Weighted-average shares used to compute net income per share, basic
253,891
266,516
Weighted-average shares used to compute net income per share, diluted
254,313
270,296
(1) Costs and expenses include share-based compensation expense as follows:
Three Months Ended April 30,
2026
2025
Costs of subscription services
$ 37
$ 42
Costs of professional services
26
30
Product development
184
183
Sales and marketing
90
92
General and administrative
72
70
Restructuring
0
42
Total share-based compensation expense
$ 409
$ 459
Workday, Inc.
Condensed Consolidated Statements of Cash Flows
(in millions)
(unaudited)
Three Months Ended April 30,
2026
2025
Cash flows from operating activities:
Net income
$ 222
$ 68
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
92
84
Share-based compensation expense
409
459
Amortization of deferred costs
79
68
Non-cash lease expense
32
27
Net losses on investments
8
1
Accretion of discounts on marketable debt securities, net
(9)
(20)
Deferred income taxes
93
18
Asset impairments
0
34
Other
5
13
Changes in operating assets and liabilities:
Trade and other receivables, net
747
601
Deferred costs
(65)
(53)
Prepaid expenses and other assets
(31)
(38)
Accounts payable
(1)
(4)
Accrued expenses and other liabilities
(200)
(131)
Unearned revenue
(685)
(670)
Net cash provided by operating activities
696
457
Cash flows from investing activities:
Purchases of marketable securities
(200)
(1,345)
Maturities of marketable securities
231
722
Sales of marketable securities
96
140
Capital expenditures
(80)
(36)
Purchases of non-marketable equity and other investments
0
(4)
Sales of non-marketable equity and other investments
41
0
Other
9
0
Net cash provided by (used in) investing activities
97
(523)
Cash flows from financing activities:
Repurchases of common stock
(1,587)
(290)
Taxes paid related to net share settlement of equity awards
(146)
(211)
Net cash used in financing activities
(1,733)
(501)
Effect of exchange rate changes
(1)
1
Net decrease in cash, cash equivalents, and restricted cash
(941)
(566)
Cash, cash equivalents, and restricted cash at the beginning of period
1,509
1,554
Cash, cash equivalents, and restricted cash at the end of period
$ 568
$ 988
Workday, Inc.
Reconciliations of GAAP to Non-GAAP Data
Reconciliations of Workday's GAAP to non-GAAP operating results are included in the following tables (in millions, except
number of shares which are reflected in thousands, percentages, and per share data). See the section titled "About Non-GAAP
Financial Measures" below for further details.
Three Months Ended April 30,
2026
2025
Non-GAAP operating income
Operating income
$ 338
$ 39
Share-based compensation expense (1)
409
417
Employer payroll tax-related items on employee stock transactions
19
27
Amortization of acquisition-related intangible assets
36
21
Acquisition-related costs
7
7
Restructuring costs
0
166
Non-GAAP operating income
$ 809
$ 677
Non-GAAP operating margin (2)
Operating margin
13.3 %
1.8 %
Share-based compensation expense (1)
16.1 %
18.6 %
Employer payroll tax-related items on employee stock transactions
0.7 %
1.2 %
Amortization of acquisition-related intangible assets
1.4 %
0.9 %
Acquisition-related costs
0.3 %
0.3 %
Restructuring costs
0.0 %
7.4 %
Non-GAAP operating margin
31.8 %
30.2 %
Non-GAAP net income
Net income
$ 222
$ 68
Share-based compensation expense (1)
409
417
Employer payroll tax-related items on employee stock transactions
19
27
Amortization of acquisition-related intangible assets
36
21
Acquisition-related costs
7
7
Restructuring costs
0
166
Net (gains) losses on strategic investments
9
1
Income tax effects
(26)
(105)
Non-GAAP net income
$ 676
$ 602
Non-GAAP diluted net income per share (2)(3)
Diluted net income per share
$ 0.87
$ 0.25
Share-based compensation expense (1)
1.61
1.54
Employer payroll tax-related items on employee stock transactions
0.08
0.10
Amortization of acquisition-related intangible assets
0.14
0.08
Acquisition-related costs
0.03
0.02
Restructuring costs
0.00
0.61
Net (gains) losses on strategic investments
0.03
0.00
Income tax effects
(0.10)
(0.37)
Non-GAAP diluted net income per share
$ 2.66
$ 2.23
(1)
Share-based compensation expense in the GAAP to non-GAAP reconciliation tables above excludes share-based compensation associated with
restructuring activities of $42 million for the three months ended April 30, 2025. These expenses are included in Restructuring costs.
(2)
Operating margin and diluted net income per share are calculated using unrounded data.
(3)
Weighted-average shares used to calculate GAAP and non-GAAP diluted net income per share were 254,313 and 270,296 for the three months
ended April 30, 2026, and 2025, respectively.
Reconciliation of Workday's GAAP cash flows from operating activities to non-GAAP free cash flow is as follows (in millions). See the section titled
"About Non-GAAP Financial Measures" below for further details.
Three Months Ended April 30,
2026
2025
Net cash provided by operating activities
$ 696
$ 457
Less: Capital expenditures
(80)
(36)
Free cash flows
$ 616
$ 421
About Non-GAAP Financial Measures
To provide investors and others with additional information regarding Workday's results, the following non-GAAP financial measures are disclosed: non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, non-GAAP diluted net income per share, and free cash flows. Workday has provided a reconciliation of each non-GAAP financial measure used in this earnings release to the most directly comparable GAAP financial measure. Non-GAAP operating income and non-GAAP operating margin differ from GAAP in that they exclude share-based compensation expense, employer payroll tax-related items on employee stock transactions, amortization expense for acquisition-related intangible assets, acquisition-related costs, and restructuring costs. Non-GAAP net income and non-GAAP diluted net income per share differ from GAAP in that they exclude share-based compensation expense, employer payroll tax-related items on employee stock transactions, amortization expense for acquisition-related intangible assets, acquisition-related costs, restructuring costs, gains and losses on strategic investments, and income tax effects. Free cash flows differ from GAAP cash flows from operating activities in that it treats capital expenditures as a reduction to cash flows.
Workday's management uses these non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, for short- and long-term operating plans, and to evaluate Workday's financial performance. Management believes these non-GAAP financial measures reflect Workday's ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of trends in Workday's business. Management also believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating Workday's operating results and prospects in the same manner as management and in comparing financial results across accounting periods and to those of peer companies.
Management believes excluding the following items from the GAAP Condensed Consolidated Statements of Operations is useful to investors and others in assessing Workday's operating performance due to the following factors:
Additionally, with regards to free cash flows, Workday's management believes that reducing cash provided by operating activities by capital expenditures is meaningful to investors and others because it provides an enhanced view of cash flow generation from the ongoing operations of our business, and it balances operating results, cash management, and capital efficiency.
The use of these non-GAAP measures have certain limitations as they do not reflect all items of expense or cash that affect Workday's operations. Workday compensates for these limitations by reconciling the non-GAAP financial measures to the most comparable GAAP financial measures. These non-GAAP financial measures should be considered in addition to, not as a substitute for or in isolation from, measures prepared in accordance with GAAP. Further, these non-GAAP measures may differ from the non-GAAP information used by other companies, including peer companies, and therefore comparability may be limited. Management encourages investors and others to review Workday's financial information in its entirety and not rely on a single financial measure.
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SOURCE Workday, Inc.