Workday Reports Strong Fiscal Q3, Raises Guidance Amid AI Expansion Costs
Workday (NASDAQ: WDAY) reported stronger fiscal third-quarter results and raised its full-year subscription guidance on November 27, 2025, though shares declined over 9% as investors considered costs tied to AI expansion.
Revenue increased 12.6% year over year to $2.432 billion, led by subscription revenue of $2.244 billion, which grew 14.6% year over year. Earnings of $2.32 per share exceeded analyst expectations of $2.17.
Workday cited broad customer demand and accelerating adoption of its AI-powered finance and HR tools. CFO Zane Rowe stated that the third-quarter performance reflected progress across multiple growth initiatives.
The company now anticipates fiscal 2026 subscription revenue of $8.828 billion, representing 14% growth, alongside a non-GAAP operating margin of roughly 29%. For the quarter ending January 2026, Workday guided to subscription revenue of $2.355 billion, an increase of 15.5%, with projected non-GAAP operating margins of at least 28.5%.
For additional insights into Workday's financial standing, explore Workday Financial Health. Information on the company's strategic vision is available at Workday Mission and Vision.
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