Download PDF

1. Company Snapshot

1.a. Company Description

Workday, Inc.provides enterprise cloud applications in the United States and internationally.The company's applications help its customers to plan, execute, analyze, and extend to other applications and environments, and to manage their business and operations.


It offers a suite of financial management applications, which enable chief financial officers to maintain accounting information in the general ledger; manage financial processes; identify real-time financial, operational, and management insights; enhance financial consolidation; reduce time-to-close; promote internal control and auditability; and achieve consistency across finance operations.The company also provides cloud spend management solutions that helps organizations to streamline supplier selection and contracts, manage indirect spend, and build and execute sourcing events, such as requests for proposals; Human Capital Management (HCM) solution, a suite of human capital management applications that allows organizations to manage the entire employee lifecycle from recruitment to retirement, and enables HR teams to hire, onboard, pay, develop, reskill, and provide employee experiences; Workday applications for planning; and applications for analytics and reporting, including augmented analytics to surface insights to the line of business in simple-to-understand stories, machine learning to drive efficiency and automation, and benchmarks to compare performance against other companies.It serves professional and business services, financial services, healthcare, education, government, technology, media, retail, and hospitality industries.


The company was formerly known as North Tahoe Power Tools, Inc.and changed its name to Workday, Inc.in July 2005.


Workday, Inc.was incorporated in 2005 and is headquartered in Pleasanton, California.

Show Full description

1.b. Last Insights on WDAY

Workday's recent performance was negatively impacted by cautious guidance, despite strong Q3 earnings and revenue beat. The company's subscription revenue disappointed, leading analysts to slash their forecasts. Investors are concerned about the durability of growth in a slowing macroeconomic environment. The enterprise software company's guidance and revenue outlook have raised concerns, overshadowing its solid quarterly results, including non-GAAP earnings per share of $2.32.

1.c. Company Highlights

2. Workday's Q3 Results Exceed Expectations, Driven by AI Momentum

Workday delivered a strong Q3 performance, with subscription revenue growth of 15% to $2.244 billion, and a non-GAAP operating margin of 28.5%. Earnings per share (EPS) came in at $2.32, beating analyst estimates of $2.17. The company's operating cash flow was $588 million, up 45% year-over-year, and it repurchased $803 million of shares during the quarter. Workday's financial performance was robust, with a P/E Ratio of 96.97 and a P/S Ratio of 6.76, indicating a premium valuation.

Publication Date: Nov -26

📋 Highlights
  • Subscription Revenue Growth:: 15% increase to $2.244 billion, with a 28.5% non-GAAP operating margin, reflecting strong operational efficiency.
  • AI-Driven ARR Growth:: AI products added 1.5 points of ARR growth, with 75% of core customers using Workday Illuminate AI.
  • International Expansion:: Solid growth in EMEA, APAC, and Japan, supported by new AI centers in Dublin and an office in Dubai.
  • Acquisition Impact:: Paradox and Sana contributed over 1 point each to Q4 subscription revenue growth, with Paradox to be sold agnostically.
  • Shareholder Returns:: $803 million in share repurchases and 45% increase in operating cash flow to $588 million.

AI-Driven Growth

Workday's AI products added over 1.5 points of ARR growth, with more than 75% of core customers using Workday Illuminate AI. The company's AI solutions are driving significant uplift, with HiredScore selling $2.50 for every dollar of recruiting sold. The acquisition of Sana is expected to add a leading knowledge management and agent orchestrator to create an AI experience layer across Workday. As the company noted, "the AI narrative is changing, with customers coming back to trusted vendors like Workday that have been in their infrastructure for a long time and drive real business outcomes."

International Performance and Partnerships

Workday's international performance was strong, with solid growth across EMEA, APAC, and Japan. The company established a new AI center of excellence in Dublin and announced a new office in Dubai. Partnerships played a critical role in Q3, with over 20% of net new ACV sourced from partners. The company's partnership with Microsoft and acquisition of PipeDream are driving enterprise-wide AI transformation.

Outlook and Valuation

Workday expects subscription revenue of $2.355 billion in Q4, representing 15% growth, and a non-GAAP operating margin of at least 28.5%. The company targets a subscription revenue CAGR of 12-15% through FY '28 and expects FY '27 subscription revenue growth of approximately 13%. Analysts estimate next year's revenue growth at 13.1%. With a P/E Ratio of 96.97 and an EV/EBITDA ratio of 61.58, Workday's valuation appears to be pricing in significant growth expectations. The company's Free Cash Flow Yield is 4.14%, indicating a reasonable return for investors.

3. NewsRoom

Card image cap

Gravity IT Resources Joins the Workday Partner Program

Dec -04

Source: globenewswire.com

Card image cap

Workday Recognized as a Leader in 2025 Gartner® Magic Quadrant™ for Financial Planning Software for Fourth Year in a Row

Dec -04

Source: prnewswire.com

Card image cap

Workday President to Present at Barclays 23rd Annual Global Technology Conference on December 11, 2025

Dec -04

Source: prnewswire.com

Card image cap

Fisher Asset Management LLC Trims Stake in Workday, Inc. $WDAY

Dec -04

Source: defenseworld.net

Card image cap

Here Are Tuesday’s Top Wall Street Analyst Research Calls: Albemarle, Circle Internet, Cloudflare, Danaher, Inspire Medical, Six Flags, Workday and More

Dec -02

Source: 247wallst.com

Card image cap

Can Workday Stock Bounce From Current Support?

Nov -28

Source: forbes.com

Card image cap

Workday Q3 Earnings Beat on Strength in Subscription Services

Nov -28

Source:

Card image cap

Workday, Inc. $WDAY Holdings Raised by Choreo LLC

Nov -28

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (26.10%)

6. Segments

Cloud Applications

Expected Growth: 26.1%

Workday's cloud applications, including financial management and human capital management, are expected to drive growth, driven by increasing adoption of cloud-based solutions, digital transformation, and need for real-time financial insights.

7. Detailed Products

Workday Financial Management

A cloud-based financial management system that provides financial planning, accounting, and procurement capabilities.

Workday Human Capital Management

A cloud-based human capital management system that provides recruitment, talent management, and workforce planning capabilities.

Workday Planning

A cloud-based planning system that provides financial planning, budgeting, and forecasting capabilities.

Workday Procurement

A cloud-based procurement system that provides procurement, inventory management, and expense management capabilities.

Workday Project Management

A cloud-based project management system that provides project planning, execution, and monitoring capabilities.

Workday Prism Analytics

A cloud-based analytics system that provides data analytics and reporting capabilities.

Workday Student

A cloud-based student information system that provides student management, registration, and financial aid capabilities.

8. Workday, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Workday, Inc. has a low threat of substitutes due to its unique cloud-based financial management and human capital management software solutions.

Bargaining Power Of Customers

Workday, Inc. has a medium bargaining power of customers due to the presence of large enterprises and governments as its customers, which can negotiate prices and terms.

Bargaining Power Of Suppliers

Workday, Inc. has a low bargaining power of suppliers due to its ability to negotiate prices and terms with its suppliers, given its large customer base and market presence.

Threat Of New Entrants

Workday, Inc. has a medium threat of new entrants due to the presence of barriers to entry, such as high development costs and the need for significant investments in research and development.

Intensity Of Rivalry

Workday, Inc. operates in a highly competitive market with intense rivalry among existing players, such as Oracle, SAP, and Microsoft, which can lead to pricing pressures and high marketing expenses.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 27.52%
Debt Cost 3.95%
Equity Weight 72.48%
Equity Cost 10.53%
WACC 8.72%
Leverage 37.97%

11. Quality Control: Workday, Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Uber

A-Score: 5.4/10

Value: 2.6

Growth: 9.2

Quality: 7.6

Yield: 0.0

Momentum: 6.5

Volatility: 6.3

1-Year Total Return ->

View Full Report
Stock-Card
ANSYS

A-Score: 5.3/10

Value: 0.7

Growth: 6.3

Quality: 8.5

Yield: 0.0

Momentum: 6.5

Volatility: 9.7

1-Year Total Return ->

View Full Report
Stock-Card
Autodesk

A-Score: 5.1/10

Value: 0.5

Growth: 7.3

Quality: 8.1

Yield: 0.0

Momentum: 6.5

Volatility: 8.0

1-Year Total Return ->

View Full Report
Stock-Card
Salesforce

A-Score: 5.0/10

Value: 2.2

Growth: 8.9

Quality: 8.4

Yield: 1.0

Momentum: 2.5

Volatility: 7.0

1-Year Total Return ->

View Full Report
Stock-Card
AppLovin

A-Score: 4.9/10

Value: 0.0

Growth: 9.7

Quality: 8.0

Yield: 0.0

Momentum: 10.0

Volatility: 1.7

1-Year Total Return ->

View Full Report
Stock-Card
Workday

A-Score: 4.3/10

Value: 1.0

Growth: 8.4

Quality: 6.2

Yield: 0.0

Momentum: 4.0

Volatility: 6.3

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

219.96$

Current Price

219.96$

Potential

-0.00%

Expected Cash-Flows