Workday beats estimates but CEO warns of challenges in education and government
Key Takeaways
Workday exceeded estimates for earnings and revenue and issued guidance that was largely inline with what Wall Street expected.
Article Overview
Quick insights and key information
3 min read
Estimated completion
investment
Article classification
August 21, 2025
09:34 PM
CNBC
Original publisher
In this articleWDAY your favorite stocksCREATE FREE ACCOUNTCEO of Workday Carl M
Eschenbach and Ana Eschenbach attend the Allen and Company Sun Valley Media and nology Conference at The Sun Valley Re in Sun Valley, Idaho, U.S., July 10, 2025.Brendan McDermid | ReutersWorkday reported an earnings beat on Thursday, but issued guidance that was inline with estimates and warned of pressure in some areas
The s slipped in ext trading.Here's how the company did relative to LSEG consensus:Earnings per : $2.21 adjusted vs. $2.11 expectedRevenue: $2.35 billion vs. $2.34 billion expectedRevenue increased 13% from a year earlier in the fiscal second quarter, which on July 31, according to a statement
The company's net income rose to $228 million, or 84 cents per , from $132 million, or 49 cents per , in the same quarter last year.For the current quarter, Workday called for $2.24 billion in subscription revenue and $180 million in fessional services, which implies $2.42 billion in total revenue
Analysts polled by LSEG had expected a total of $2.42 billion
The company sees an adjusted operating margin of 28.0%, just below the 28.1% consensus among analysts surveyed by StreetAccount.Workday, which vides software for finance and human resources departments, now sees $8.82 billion in subscription revenue for the full year, and $700 million in fessional services revenue, implying a total of $9.52 billion
The LSEG consensus was $9.51 billion
The part of Workday that works with state and local governments faced challenges during the quarter, CEO Carl Eschenbach said on the earnings call. "I think we'll continue to see that as people are trying to figure out what the funding slowdown is going to look , all the way to the state level," he said.Meanwhile, higher education in the U.S. is facing pressure from President Donald Trump, who signed an executive order in March to shut down the Department of Education."If it's a higher ed university that includes a healthcare system, they too are getting a little pullback in funding," Eschenbach said. "So it's something we're keeping our eye on."Also on Thursday Workday said it's acquiring Paradox, a company with conversational artificial intelligence software for recruiting, for undisclosed terms
During the quarter, Workday announced AI agents for extracting accounting details from documents and reporting absent days.As of Thursday's market close, Workday s were down 12% this year, while the Nasdaq is up 9%.WATCH: Trade Tracker: Rob Sechan details his moves in Workday, NRG Energy, Texas Pacific Land and KLA Corpwatch now1:5301:53Trade Tracker: Rob Sechan details his moves in Workday, NRG Energy, Texas Pacific Land and KLA CorpHalftime Report
Related Articles
More insights from FinancialBooklet