Workday, Inc. · WDAY · FY2026 Q4 · Calendar Q1 2026

Workday Q4 FY26: Subscription revenue +16%, AI agent ARR tops $400M

Workday's durable double-digit subscription growth, 97% gross retention with 60% net expansion, and a fast-scaling agentic-AI revenue stream (ARR over $400M) support the case that resilient enterprise demand plus monetizable AI can sustain growth into FY27. That thesis is tempered by management guiding FY27 subscription growth down to 12-13% and a Q4 sequential subscription decline tied to the one-off DIA contract, which leaves open whether the steepest phase of growth has already passed.

Reported After market closeNASDAQTechnology $50.03B market cap
100quality score

Earnings scorecard

Reported versus consensus
Reported EPS $2.47 Consensus $2.32
EPS surprise +6.5% Reported versus consensus
Reported revenue $2.53B Consensus $2.52B
Revenue surprise +0.3% Reported versus consensus

Market reaction

event-close to next-session close
Stock move +2.2% Event window
SPY move +0.8% Same window
Abnormal move +1.4% Stock minus SPY
Volume 3.9× Versus trailing sessions
Subsequent drift -4.6% Up to 20 sessions
WDAYSPY benchmark

Ask FN2 about WDAY FY2026 Q4

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Why did WDAY rise 2.2% after beating EPS estimates in FY2026 Q4?What changed in WDAY's guidance and outlook in FY2026 Q4?Give me the bull and bear case for WDAY after FY2026 Q4 earnings.

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Transcript intelligence

What changed

Subscription revenue growth accelerated to 16% YoY from 15% a quarter earlier, while the projected non-GAAP operating margin rose to roughly 30% from 28%. AI went from contributing ~1.5 points of ARR growth and 1 billion AI actions year-to-date to over $400M of AI-related ARR, $100M+ of new ACV in Q4, and 1.7 billion AI actions for FY26, all organically developed. The forward view shifted with FY27 subscription growth guided to 12-13% and the company noting a sequential subscription decline, which management attributes to the DIA contract.

Guidance delta

Management maintained rather than raised guidance. FY27 subscription revenue growth is guided to 12-13%, a step down from the ~16% YoY pace reported in Q4 FY26, with a non-GAAP operating margin projected at roughly 30%. The guided deceleration and the sequential subscription decline tied to the DIA contract are the key changes from the prior quarter's 15% growth trajectory.

Key takeaways

  • Subscription revenue grew 16% YoY and total revenue grew 15%, with EPS of $2.47 beating the $2.32 estimate (+6.5%).
  • Gross retention held at 97% with a 60% net expansion rate, signaling resilient demand within the base.
  • Emerging AI products drove over $100M of new ACV in Q4, with AI-related ARR now exceeding $400M; 1.7 billion AI actions were delivered in FY26.
  • FY27 subscription revenue growth is guided to 12-13%, a deceleration from the FY26 pace, alongside a projected ~30% non-GAAP operating margin.
  • Capital allocation includes roughly $1.5B in share repurchases and $270M of capex.

Management priorities

  • Scale organically developed AI agents, with general availability of 12 new agents planned in FY27.
  • Drive adoption of the consumption-based Flex Credits pricing model for AI services.
  • Expand internationally (Canada, EMEA, ASEAN, Japan) via Workday Go and reseller partnerships.
  • Monetize the data cloud and APIs to capture third-party usage.
  • Return capital to shareholders, funding ~$1.5B in buybacks while investing in AI and engineering.

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Earnings History

Estimate Beat Miss Match
WDAY REVENUE earnings history estimate and actual scatter chart 9 reported fiscal quarters and 2 future estimate-only quarters. Q4 '24 estimate $2B Q4 '24 actual $2B, miss Q1 '25 estimate $2B Q1 '25 actual $2B, beat Q2 '25 estimate $2B Q2 '25 actual $2B, beat Q2 '26 estimate $2B Q2 '26 actual $2B, beat Q3 '26 estimate $2B Q3 '26 actual $2B, beat Q4 '26 estimate $3B Q4 '26 actual $3B, beat Q1 '27 estimate $3B Q1 '27 actual $3B, beat Q2 '27 estimate $3B Q2 '27 actual $3B, beat Q3 '27 estimate $3B Q4 '27 estimate $3B
Show 1 more >

Analyst Consensus ?

ConsensusHold78 ratings
Bullish3950.0%
Neutral3646.2%
Bearish33.8%

1 unmapped firm rating excluded from the percentages.

Analyst 52W Price Targets

$189.45Current
$125Low
$224.26Average
$320High

Latest persisted target per named analyst; persisted current price from FN2's market snapshot as of Sep 26, 2026. Not an FN2 forecast.

Firm-level rating actions

FMP grade actions identify the grading firm, not a named analyst.

FirmRatingPrior ratingActionDate
Goldman Sachs Neutral NeutralMaintainAug 31, 2026
Wells Fargo Overweight OverweightMaintainAug 28, 2026
TD Cowen Hold HoldMaintainAug 28, 2026
Stifel Hold HoldMaintainAug 28, 2026
RBC Capital Outperform OutperformMaintainAug 28, 2026
Show 74 more rating actions

Named analyst price targets

Upside is calculated against the persisted current price $189.45. FMP does not supply a rating on these named-analyst rows.

FirmAnalyst52W targetPrice when postedUpsideDate
Goldman SachsAnalyst unavailable$164$198.08 -13.4%Aug 31, 2026
JefferiesBrent Thill$220$194.31 +16.1%Aug 28, 2026
D.A. DavidsonAnalyst unavailable$190$194.37 +0.3%Aug 28, 2026
BMO CapitalAnalyst unavailable$230$195.42 +21.4%Aug 28, 2026
Cantor FitzgeraldAnalyst unavailable$205$194.7 +8.2%Aug 28, 2026
See 167 more

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Company context

Snapshot as of publication

Workday, Inc. delivers comprehensive, cloud-hosted enterprise software solutions to clients worldwide. These platforms empower organizations to strategize, operate, examine performance, integrate with existing systems, and oversee their overall business functions. A core offering includes a robust suite of financial management tools. These are designed to assist Chief Financial Officers (CFOs) in meticulously maintaining general ledger accounting data, streamlining financial workflows, gaining instant insights into financial and operational metrics, optimizing consolidation, accelerating month-end closes, bolstering internal controls and audit readiness, and ensuring uniformity throughout their financial activities. Workday also provides cloud-based spend management solutions. These facilitate smoother supplier engagement and contract administration, optimize the handling of indirect expenditures, and enable the effective execution of sourcing initiatives, including requests for proposals (RFPs).…

Historical context

All WDAY earnings
+5.8%FY2027 Q2 · Calendar Q3 2026+5.2%FY2027 Q1 · Calendar Q2 2026

Technology peers this season

Latest reports in the same sector
CompanyQuarterEPS surpriseMarket moveHeadline
SNX TD Synnex Corp FY2026 Q3 · Calendar Q3 2026 +20.9% -9.9% TD SYNNEX: AI-led growth accelerates, but mix and cash flow matter
ADBE Adobe Inc. FY2026 Q3 · Calendar Q3 2026 +0.8% +1.4% Adobe raises FY26 outlook as AI strategy broadens
ORCL Oracle Corporation FY2027 Q1 · Calendar Q3 2026 +10.3% -1.7% Oracle raises FY27 outlook as AI demand accelerates cloud growth
SAIL SailPoint, Inc. FY2027 Q2 · Calendar Q3 2026 +13.8% -1.2% SailPoint pairs 25% ARR growth with accelerating AI-driven adoption
CIEN Ciena Corporation FY2026 Q3 · Calendar Q3 2026 +22.0% -10.4% Ciena raises outlook as AI networking demand lifts backlog
DOCU DocuSign, Inc. FY2027 Q2 · Calendar Q3 2026 +6.4% +3.7% DocuSign Q2 FY27: IAM momentum supports a raised outlook

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Sources

  1. Earnings call transcript and parsed analysis · 2026-05-11T10:29:34.698584+00:00
  2. FN2 earnings calendar · 2026-07-26T00:37:12.209961+00:00
  3. Polygon adjusted daily market bars · 2026-09-25T23:11:06.449740+00:00
  4. Financial Modeling Prep analyst price-target consensus and quote snapshot · 2026-09-25T23:11:06.446965+00:00

Methodology

Reported and consensus figures come from FN2's earnings event records. Market reaction and volume are calculated from daily adjusted bars around the event; abnormal move subtracts the SPY move over the same window.

Analyst target low, average, and high values are derived at request time from each named analyst's latest persisted FMP target. The current-price marker comes from FN2's persisted market snapshot. They are sell-side estimates, not an FN2 valuation or recommendation.

Transcript intelligence is a structured synthesis of the current and prior earnings-call analyses. Missing values stay missing and are never estimated.

By FN2 Research · Updated · As of 2026-09-25. For educational purposes only; not investment advice.