What's Going On With Workday Shares Wednesday?

Workday, Inc. WDAY stock is moving lower on Wednesday after the company reported 2025 fiscal-year third quarter earnings on Tuesday after the bell.

The Details: Workday shares fell approximately 10% after the company released earnings on Tuesday and shares continue to fall headed into Wednesday. The company reported earnings, including adjusted earnings per share of $1.89, beating analyst estimates of $1.76.

Furthermore, the company reported sales of $2.16 billion, beating analyst estimates of $2.12 billion.

The company reported other key pieces of financial data as well. Workday reported 12-month subscription revenue backlog of $6.98 billion and total subscription revenue backlog of $22.19 billion. It reported free cash flows of $359 million and operating cash flows of $406 million.

Workday issued guidance for the 2025 fiscal-year fourth quarter. It anticipates subscription revenue of $2.02 billion. Additionally, the company revised its 2025 fiscal-year subscription revenue outlook, reducing it from between $7.70 billion to $7.72 billion to $7.703 billion.

“Workday’s solid performance in Q3 reflects the trust our customers place in us across industries, the global momentum around our AI-driven innovations, and the strength of our partner ecosystem,” said Carl Eschenbach, CEO, Workday.

“Organizations are increasingly consolidating on the Workday platform to reduce total cost of ownership, simplify their operations, and to unlock the power of our best-in-class AI solutions. Workday gives them the ultimate advantage – and that positions our business for long-term success.”

Analyst Changes: Following the earnings report, multiple analysts issued price target changes.

• Piper Sandler analyst Brent Bracelin downgraded Workday from an Overweight rating to a Neutral rating and lowered the price target from $285 to $270.
• Needham analyst Scott Berg reiterated a Buy rating on Workday and maintained a $300 price target.
• B of A Securities analyst Brad Sills maintained a Buy rating on Workday and lowered the price target from $310 to $285.
• Barclays analyst Raimo Lenschow maintained an Overweight rating on Workday and lowered the price target from $314 to $305.
• Loop Capital analyst Yun Kim maintained a Hold rating on Workday and lowered the price target from $270 to $242.
• Morgan Stanley analyst Keith Weiss maintained an Overweight rating on Workday and raised the price target from $315 to $330.

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WDAY Price Action: At the time of publication, Workday stock is trading 4.97% lower at $256.74, according to data from Benzinga Pro.

Image: Courtesy of Workday