Enterprise software maker Workday (WDAY) on Monday reported fourth-quarter earnings that topped estimates while revenue missed Wall Street targets. The company reiterated 2025 subscription revenue guidance for WDAY stock.
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Workday reported Q4 results after the market close.
For the quarter ending Jan. 31, Workday earnings rose 58% to $1.57 per share from a year earlier on an adjusted basis.
Revenue climbed 17% to $1.9 billion, including acquisitions.
Analysts expected Workday earnings of $1.47 a share on revenue of $1.92 billion. A year earlier, Workday earnings were 99 cents a share on sales of $1.65 billion.
The Pleasanton, Calif.-based company said subscription revenue rose 18% to $1.8 billion, topping estimates of $1.76 billion.
On the stock market today, WDAY stock fell more than 5% to 290 in extended trading.
WDAY Stock: Subscription Revenue Outlook
The company reiterated 2025 guidance. Workday provided initial fiscal 2025 guidance in November. It forecast subscription revenue growth of 17% to 18%, in-line with views.
Workday said it expects profit margins to improve in fiscal 2025. Analysts predict operating margins of 24.4% in fiscal 2025.
The company sells software for human capital management, such as payroll tools. Also, it has expanded into financial software.
Heading into the Workday earnings report, shares had advanced nearly 11% in 2024.
In September, Workday lowered its outlook for subscription revenue growth through fiscal 2027 at an analyst day. Workday told analysts Wednesday it now expects subscription revenue growth in a range of 17% to 19% in the next three fiscal years, down from its earlier target of 20%.
According to IBD Stock Checkup, WDAY stock holds a Relative Strength Rating of 92 out of a best-possible 99.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
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