Workday (WDAY) Q4 2025 earnings summary

Executive summary

• Fiscal year 2025 subscription revenues reached $7.718B, up 16.9% year-over-year, with total revenues at $8.446B, up 16.4% year-over-year.

• Achieved 16% subscription revenue growth in Q4 and 17% for the full year, with strong execution across industries and geographies.

• Launched the Agent System of Record and several new AI-driven product offerings, including Illuminate agents and Workday Student in Australia and New Zealand.

• Welcomed major new customers and expanded relationships with industry leaders, now serving over 11,000 customers globally, including 60%+ of the Fortune 500 and ~30% of Forbes Global 2000.

• Announced a restructuring plan to reduce workforce by approximately 8% and exit certain office spaces.

Financial highlights

• Q4 FY25 total revenues were $2.211B, up 15% year-over-year; subscription revenues were $2.040B, up 15.9%.

• FY25 non-GAAP operating income was $2.186B (25.9% margin); Q4 non-GAAP operating income was $584M (26.4% margin).

• FY25 operating cash flow was $2.461B (29.1% margin); free cash flow was $2.192B.

• Gross revenue retention rates remained strong at 98%.

• Repurchased $700M in shares during FY25; $802M remaining authorization.

Outlook and guidance

• FY26 subscription revenue guidance is $8.8B, up 14%; total revenue guidance is $9.5B, up 13%.

• Q1 FY26 subscription revenue guidance: ~$2.05B, up 13-14% year-over-year.

• FY26 non-GAAP operating margin expected at 28%; Q1 non-GAAP margin also at 28%.

• FY26 operating cash flow projected at $2.75B, including $180M in restructuring outflows.

• FY26 capital expenditures expected at $250M.