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Apr 30, 2025
Workday Q1 2026 Earnings Report
Workday reported strong subscription revenue growth and solid non-GAAP profitability in Q1 FY26, despite significant restructuring costs.
Key Takeaways
Workday delivered a solid Q1 FY26 performance with total revenue of $2.24B and a net income of $68M, despite $166M in restructuring expenses. The company achieved a strong non-GAAP EPS of $2.23 and maintained momentum in subscription services.
Revenue by Segment
Forward Guidance
Workday reaffirmed its FY26 subscription revenue target of $8.8B and increased its non-GAAP operating margin outlook to 28.5%.
Positive Outlook
- Subscription revenue guidance reaffirmed at $8.8B for FY26
- Non-GAAP operating margin raised to 28.5%
- Q2 FY26 subscription revenue expected to grow 13.5% YoY
- Successful product innovations like Illuminate Agents
- New and expanded enterprise customer relationships
Challenges Ahead
- GAAP operating margin declined due to restructuring
- EPS dropped YoY from $0.40 to $0.25
- Ongoing restructuring expenses impacted profitability
- High share-based compensation expense
- Unearned revenue declined compared to prior quarter
Historical Earnings Impact
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Avg. Return Before/After Earnings
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