"Our AI has evolved and is delivering tangible ROI, we have new monetization opportunities that will fuel our long-term growth." - Carl Eschenbach
— Carl Eschenbach
03Detailed Report
WDAY
Workday Inc
Period
Q4 2025
CurrencyUSD
Report TypeQuarterly Earnings
GeneratedJun 5, 2026
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Executive Summary
In Q4 2025, Workday Inc. (WDAY) demonstrated robust financial performance, achieving $2.21 billion in total revenue, marking a 15% year-over-year growth. Subscription revenue reached $2.04 billion, reflecting a 16% increase, underscoring continued demand for its cloud-based enterprise applications. During the earnings call, CEO Carl Eschenbach highlighted the company’s successful execution across key sectors, including financial services and healthcare, while emphasizing the increasing integration of AI within its offerings. The launch of the Agent System of Record aims to streamline management of AI agents in organizational frameworks and further bolster customer services, reflecting Workday's commitment to innovation and efficiency. As the company navigates a transformative year, its robust customer base and strategic initiatives position it well for sustained growth and resilience.
Key Performance Indicators
Revenue
Increasing
2.21B
QoQ: 2.36% | YoY: 15.81%
Gross Profit
Increasing
1.67B
75.62% margin
QoQ: -8.68% | YoY: 15.45%
Operating Income
Increasing
75.00M
QoQ: -54.55% | YoY: 13.26%
Net Income
Decreasing
94.00M
QoQ: -51.30% | YoY: -92.09%
EPS
Decreasing
0.35
QoQ: -52.05% | YoY: -92.26%
Revenue Trend
Margin Analysis
Financial Highlights
1. Revenue Performance: Total revenue for Q4 reached $2.21 billion, up 15% YoY, driven primarily by a 16% growth in subscription revenue to $2.04 billion.
2. Profitability Metrics: Gross profit was approximately $1.67 billion with a gross margin of 75.6%. However, operating income saw a decrease to $75 million, a 54.6% sequential decline, influenced by restructuring costs and increased operational expenses.
3. Net Income: Net income was reported at $94 million, representing a net margin of 4.3%. Significant YoY decline in net income was noted due to one-off expenses related to restructuring and lower operating income.
4. Cash Flow: The operating cash flow improved to $1.11 billion for the quarter, contributing to a total of $2.46 billion for FY 2025, indicating strong cash generation capabilities. Free cash flow stood at $1.03 billion, reinforcing financial strength for future investments.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
2.21B
15.81%
2.36%
Gross Profit
1.67B
15.45%
-8.68%
Operating Income
75.00M
13.26%
-54.55%
Net Income
94.00M
-92.09%
-51.30%
EPS
0.35
-92.26%
-52.05%
Key Financial Ratios
Gross Profit Margin
Excellent
75.60%
Gross profit margin is exceptional, indicating strong pricing power and operational efficiency
Operating Profit Margin
Weak
3.39%
Operating margin is below industry norms, profitability concerns
Net Profit Margin
Fair
4.25%
Net profit margin is moderate, room for improvement in cost management
Return on Assets
Weak
0.52%
Return on assets suggests inefficient capital allocation
Return on Equity
Weak
1.04%
Return on equity suggests inefficient capital allocation
Current Ratio
Healthy
1.85
Current ratio shows adequate liquidity to meet short-term obligations
Debt to Equity
Moderate
0.37
Debt-to-equity indicates balanced capital structure with manageable debt
P/E Ratio
High Growth
185.28x
Very high P/E indicates aggressive growth expectations, higher risk
Price to Book
High Premium
7.71x
Very high premium suggests asset-light business model or lofty expectations
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