Workday Beats Q1, But Stock Falls 10% on Muted Guidance

Workday (NASDAQ:WDAY) delivered first-quarter results that exceeded expectations on both earnings and revenue, but shares fell over 10% intra-day today as guidance for the current quarter and full year underwhelmed investors.

The enterprise cloud software provider posted adjusted EPS of $2.23, topping the $2.01 consensus. Revenue rose 12.6% year-over-year to $2.24 billion, slightly ahead of analyst estimates of $2.22 billion.

Despite the solid beat, Workday's guidance failed to spark enthusiasm. The company projected Q2 subscription revenue of $2.16 billion, reflecting 13.5% growth—below the high-growth momentum seen in prior periods. Full-year fiscal 2026 subscription revenue was reiterated at $8.8 billion, representing a 14% annual increase, which some investors viewed as conservative given the company’s positioning in AI-driven enterprise software.