Workday Posts Q4 Beat, Guidance Suggests Another Slowdown In Revenue Growth: Analysts

Shares of Workday Inc WDAY were climbing in early trading on Wednesday after the company reported upbeat fourth-quarter results.

The results came in amid an exciting earnings season.

Piper Sandler analyst Brent Bracelin maintained a Neutral rating, while raising the price target from $270 to $290.
Needham analyst Scott Berg reaffirmed a Buy rating and price target of $300.
JMP Securities analyst Patrick Walravens maintained a Market Outperform rating and price target of $315.

Check out other analyst stock ratings.

Piper Sandler: Workday reported subscription revenue growth of 15.9%. That’s a steady increase compared to the previous quarter's 15.8%, Bracelin said in a note. Core customers grew by around 17% to 6,100, of which more than 2,000 were full suite customers, he added.

Current remaining performance obligations, or cRPOs, grew by 15% year-on-year. Bracelin credits this to “stronger-than-expected early renewal activity.” However, the company's 2026 growth outlook of 12.5% "suggests top-line growth could moderate for the third consecutive year (vs. 16.4% in F2025) even with the reiteration of the $8.8B subscription revenue target," he further wrote.

Needham: Workday reported revenue growth of 15% year-on-year, driven by 15.9% growth in subscription revenue, Berg said. The company's cRPO decelerated slightly from the previous quarter's 15.4% year-on-year to 15.2% in the fourth quarter. However, it came in much above the guidance for 13.5%-14.5%.

Workday has been investing aggressively in AI, the analyst stated. "Sales commentary highlighted the company’s growing AI opportunity, with the company launching an additional four role-based agents as adoption continues to rapidly rise," he further wrote.

JMP Securities: Workday reported revenues of $2.21 billion, subscription revenue of $2.04 billion and non-GAAP earnings of $1.92 per share. It beat consensus of $2.18 billion, $2.03 billion and $1.78 per share, respectively, Walravens said. Management's fiscal first quarter guidance calls for subscription revenue of $2.05 billion, a tad below consensus of $2.06 billion, he added.

The company guided to full-year subscription revenue of $8.80 billion, representing 14% year-on-year growth and in-line with expectations, the analyst stated. "We continue to view Workday as an attractive opportunity for long-term capital appreciation.”

Price Action: Shares of Workday had risen by 7.46% to $277.25 at the time of publication on Wednesday.

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