Workday, Inc. (WDAY)

Workday reported fiscal 2027 second-quarter revenue of $2.649 billion on 27 August 2026, up 12.8 percent from a year earlier 1. Subscription revenue, the fees customers pay to use its cloud software, was $2.471 billion, up 13.9 percent 1.

Chief executive Aneel Bhusri said AI is driving more than 25 percent of new ACV, or annual contract value 1. He added that more than 5,500 customers use at least one of the company's own agents 1. The company expects fiscal 2027 subscription revenue of $9.940 billion to $9.950 billion 1.

Since then Workday has announced a cut of about 2.5 percent of its workforce, mostly in product and technology 4. It has agreed to acquire C1.ai, which governs which people and AI agents may reach which systems 5. It also sold $2.5 billion of senior notes 6.

In August Reuters reported that private equity firm Silver Lake was in talks to acquire Workday, with no guarantee a deal would materialize 10. The open question is whether those talks lead to an agreement 10.

Aneel Bhusri co-founded Workday in 2005, and David Duffield is also a co-founder 8. The company sells cloud software that lets organizations run human resources and finance on one platform 3.

Revenue climbed from $7,259 million in fiscal 2024 to $8,446 million in fiscal 2025 and $9,552 million in fiscal 2026 3. Subscription revenue was $8.8 billion in fiscal 2026, up 14 percent from $7.7 billion 3.

The company says about 60 percent of that fiscal 2026 subscription increase came from existing customers expanding, and the rest from customers added later 3. Its gross revenue retention rate, the share of recurring revenue kept from existing customers, was about 97 percent 3.

Operating income, profit from running the business, rose from $183 million in fiscal 2024 to $415 million and then $721 million in fiscal 2026 3. Net income was $1,381 million in fiscal 2024, when income taxes were a $1,025 million benefit, then $526 million and $693 million 3.

In February 2025 Workday announced a restructuring plan that reduced about 7.5 percent of its workforce, and in February 2026 another expected to reduce about 2 percent 3. Restructuring cost about $303 million in fiscal 2026 3. The later plan fell mainly on Global Customer Operations, with charges of about $135 million 9.

Fiscal 2026 was also a year of purchases: Flowise, Paradox, Sana and Pipedream, all aimed at AI agents and knowledge tools 3. Sana alone carried a purchase consideration of $1.1 billion, and net outflows for acquisitions were $2.1 billion 3.

The board appointed Bhusri chief executive on 6 February 2026, and Carl Eschenbach ceased to serve as CEO 8. Bhusri had earlier been co-CEO from August 2020 through January 2024, after serving as CEO from 2014 to August 2020 8.

What Workday sells

Human capital management (HCM) software covers the whole employee lifecycle, from recruitment to retirement: hiring, onboarding, pay, development and reskilling 3. Financial management covers payables, receivables, consolidation and closing the books faster 3.

Spend management covers supplier selection, contracts and expenses, and planning models scenarios across finance, workforce and sales data 3. Workday also sells AI agents, software helpers that do tasks, and says more than 5,500 customers now use at least one of its own 31.

Recent releases include Developer Agent, Agent Passport, which tests and verifies AI agents, and Workday Learning, powered by Sana 1. Workday also announced partnerships with Amazon Web Services and Google Cloud 1.

Customers and revenue

Workday serves more than 11,500 organizations, among them more than 65 percent of the Fortune 500 3. Subscription services were about 92 percent of fiscal 2026 revenue, and professional services, the deployment and training work, brought $719 million 3.

The 12-month subscription revenue backlog, subscription revenue already contracted for the next year, was $9.034 billion at 31 July 2026, up 14.2 percent 1. Cash and marketable securities were $3.403 billion 1.

People and places

Headcount was 20,896 at 31 July 2026 2. Workday's headquarters in Pleasanton, California, has about 1.0 million square feet of owned facilities and a 6.9 acre parcel of leased land, with a lease that runs to 2108 3.

Bhusri is chief executive and chair, and Zane Rowe is chief financial officer 1. Gerrit Kazmaier is president, product and technology 5.

Rivals

The 10-K names Oracle and SAP as the large, well-established vendors it competes with 3. It also lists Anaplan, ADP, Coupa, Dayforce, Microsoft, NetSuite, ServiceNow and UKG among other competitors 3.

Current problems

Derek Mobley sued Workday in a case claiming its AI screening tools disadvantage job applicants over 40, and in May 2025 a judge granted preliminary certification as a nationwide collective action 13. Workday has said the lawsuit lacks merit 13.

Workday is also cutting about 2.5 percent of staff and some leased office space, at an expected charge of $65 million to $80 million 4.

The umbrella, in words

Products carry names such as Workday Adaptive Planning, Peakon Employee Voice, VNDLY, HiredScore AI for Recruiting and Paradox 3. The annual report's subsidiaries exhibit lists, among others, Evisort, FlowiseAI, HiredScore, Paradox, Pipedream and Sana Labs, each a subsidiary Workday owns 14.

Workday manages a portfolio of investments through Workday Ventures, mainly in early-stage enterprise software companies, a tie of invested 3. Workday's Class B stock carries 10 votes a share against one for Class A 3.

Bhusri and co-founder Duffield are parties to a stock voting agreement covering their Class B stock, about 68 percent of voting power as of 31 January 2026 8.

For the third quarter ending 31 October 2026, Workday expects subscription revenue of $2.515 billion and a non-GAAP operating margin of 30.0 percent 1. For fiscal 2027 it expects a margin of 31.0 percent 1. The company is expected to report third-quarter results on 27 November 11.

Workday expects the C1.ai acquisition to close in the fourth quarter of fiscal 2027, ending 31 January 2027, subject to customary conditions 5. Neither side disclosed a price, Start with Identity reported 12.

It expects $55 million to $70 million of restructuring charges in the third quarter and about $10 million in the fourth, with staff actions substantially completed by the first quarter of fiscal 2028 4.

Workday intends to use the $2.47 billion of estimated net proceeds from its notes to retire its $1.0 billion of 3.500 percent notes due 1 April 2027 6. A new $1.5 billion revolving credit facility runs to 1 October 2031 7.

The board has authorized an additional $4.0 billion of open-ended share repurchases 1. The 10-K also said Workday Data Cloud was expected later in fiscal 2027 3.