Post-earnings recap
Reported
Thu, Aug 27, 2026
EPS actual
$2.57
EPS est.
$1.26
EPS surprise
+103.32%
1-day move
+1.48%
Workday's earnings report shows solid growth in subscription revenue, particularly from AI products, which is driving customer demand. Although the company missed EPS expectations, the stock reacted positively, likely due to strong revenue growth and management's optimistic outlook. The increase in customer engagement with AI solutions suggests a promising future for the company.
| Metric | Actual | Expected | Surprise |
|---|---|---|---|
| EPS | $2.57 | $2.61 | +103.32% |
| Subscription Revenue | $2.471 billion | N/A | N/A |
| Total Revenue | $2.649 billion | $2.6 billion | N/A |
| Gross Revenue Retention Rate | 97% | N/A | N/A |
| 12-Month Subscription Revenue Backlog Increase | 14.2% | N/A | N/A |
Management expressed confidence in the company's growth, particularly driven by AI solutions. They highlighted strong customer demand and an increase in subscription revenue.
AI products contributed over $100 million in new annual contract value, driving customer demand.
Management raised FY27 non-GAAP operating margin guidance to 31%.
Workday, Inc. is a leading provider of cloud-based software for human resources and financial management. As a key player in the Information Technology sector, it focuses on helping organizations manage their workforce and financial operations efficiently, which is increasingly important in today's digital economy.
Last quarter
In the last quarter, Workday reported an impressive EPS of $2.66, significantly beating analyst expectations. However, the stock experienced a decline of 3.76% the following day, indicating some market skepticism despite the strong earnings.
Management promises and guidance
EPS beat streak
8Q
EPS beat rate
100%
Avg EPS surprise
+175.61%
Avg 1-day reaction
+0.17%
Analysts are generally optimistic about Workday's upcoming earnings, expecting continued strong performance in both EPS and revenue. However, there are concerns about whether the company can maintain its growth trajectory amidst increasing competition.
Bull case
If Workday exceeds expectations, particularly in revenue growth, it could signal robust demand for its services, driving the stock higher.
Bear case
Conversely, any signs of slowing growth or missed targets could lead to a sharp decline in stock price, as investors may reassess the company's valuation.
Key metrics to watch
EPS
$2.61Earnings per share is a crucial indicator of profitability and investor returns.
Revenue
$2.6BRevenue growth reflects the company's ability to attract and retain customers in a competitive market.
The print will turn on these.
Q1
Will Workday's revenue meet or exceed the consensus estimate of $2.6 billion?
Revenue performance is critical for assessing the company's growth and market demand, especially in the competitive software landscape.
Q2
Can Workday maintain its impressive EPS growth trend, aiming for at least $2.61?
Sustaining EPS growth is essential for investor confidence and could influence stock performance significantly.
—
Est. EPS
—
Est. Rev
—
Impl. Move
—
Why consensus could be wrong
The Street may underestimate Workday's ability to leverage its cloud offerings, which could lead to stronger-than-expected revenue growth this quarter.
Supporting evidence
Workday's consistent EPS surprises indicate underlying strength that may not be fully reflected in current estimates.
The company's strategic investments in AI and machine learning could drive additional customer engagement and revenue.
Options pricing suggests a higher expected move, indicating that the market anticipates significant developments.
Key risk
If revenue growth significantly exceeds expectations, it could challenge the current consensus outlook.
Pre-commit to what would confirm each case.
The market is weighing the potential for continued growth against the backdrop of increasing competition and economic uncertainty.
Bull confirmed if
Achieving revenue growth above $2.6 billion and maintaining an EPS of $2.61 or better would confirm the bullish outlook.
Bear confirmed if
Falling short of the $2.6 billion revenue target or reporting an EPS below $2.41 would support the bearish case.
What the market is pricing for the move.
Implied Move
±8.89%
Historical Avg
±1.7%
The options market is pricing in a significant move following the earnings report, indicating heightened volatility expectations.
Options are pricing ±8.9% while WDAY has averaged ±1.7% over the last 8 prints — setup is pricing rich.
ATM IV
0.6%
30d HV
66.6%
Open-market trades by officers, directors, and 10%+ holders over the trailing 90 days.
Bought
$0.00
0 sh
0 insiders
Sold
$58.3M
310,748 sh
4 insiders
Net
$58.3M
Net selling
Most Active Insiders· 41 open-market trades
Likely market behavior by outcome. Not investment advice.
Beat & raise
If Workday beats expectations, history suggests the stock could see a modest increase, confirming strong demand and growth potential.
In line / cautious
An in-line report may lead to muted reactions as investors await further clarity on future growth prospects.
Miss
A miss could result in a significant drop, as historical patterns indicate negative reactions to earnings shortfalls.
House and Senate STOCK Act disclosures over the trailing 6 months.
Trades
3
1 buy·2 sells
Members
1
House only
Est. Notional
$31,003.00–$115,000.00
disclosed dollar ranges
Most Active Members
3 trades
The lines on the call that would change the story.
$55.7M
Net selling
$1.1M
Net selling
$1.0M
Net selling
$511,080.38
Net selling
Recent Transactions
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37,993 sh
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