Workday (WDAY) stock jumped over 10% in after-hours and pre-market trading after the enterprise software firm reported better-than-expected fiscal first-quarter results, temporarily easing concerns that artificial intelligence could erode demand for traditional software platforms. Adjusted EPS came in at $2.66, beating the $2.51 analyst consensus, while total revenue rose 13% year-over-year to $2.54 billion, edging past forecasts. Subscription revenue — the key metric — grew 14% to $2.35 billion, above the $2.33 billion estimate.
The company’s 12-month subscription backlog expanded 16% to $8.81 billion, and its total backlog reached $27.29 billion, though slightly below Wall Street estimates. Workday also highlighted AI agent adoption: its user base more than doubled from the prior quarter, and its Recruiting Agent supported 14 million hiring processes, a 44% jump year-over-year. CEO Aneel Bhusri, who returned to the role in February, stated, “Workday is ready for this AI moment. Our core business is strong, our AI strategy is working, and we’re moving with the speed and focus required to lead.”
For the second quarter, the company guided subscription revenue to $2.455 billion, in line with estimates, and reiterated full-year subscription revenue of $9.925–$9.950 billion, representing 12–13% growth. It also raised its full-year non-GAAP operating margin target to 30.5% from 30%. Morgan Stanley analysts viewed the results as “solid evidence” against growth durability concerns, while other analysts maintained price targets up to $180.
However, technical analysis from a second source suggested caution. WDAY remains below all key moving averages, with a death cross formed in January. The weekly chart displays an inverted cup-and-handle pattern and a bearish flag, pointing to potential further downside toward the year-to-date low of $110 unless the stock can break above $150 resistance.
