Workday, Inc. WDAY is set to release fourth-quarter fiscal 2025 results on Feb. 25, after the closing bell. In the trailing four quarters, the company delivered an average earnings surprise of 9.28%. In the last reported quarter, it delivered an earnings surprise of 9.88%.
Find the latest earnings estimates and surprises on Zacks Earnings Calendar.
The company is expected to report year-over-year revenue growth, driven by solid customer wins across various industries, including education, financials and healthcare. Strategic expansions and strong contract renewals within the existing customer base are likely to have driven the top line. Management’s strong focus on innovations, AI integration and international expansion are likely to have been other positives.
Factors at Play
In the fiscal fourth quarter, WDAY introduced the Workday Agent System of Record, a cutting-edge solution that offers a centralized system for managing enterprises’ entire fleet of AI agents. Powered by the company’s AI platform — Workday Illuminate — the solution brings numerous benefits for enterprises looking to streamline the use of AI across their operations and unlock the full potential of AI agents. As AI becomes more integral part of business operations, this tool is expected to gain solid market traction across industries.
Workday also formed a partnership with Nayya — a Workday Ventures portfolio company — to bring AI-driven health and wealth benefits to employees. Navya’s advanced data integration and analytics capabilities on the Built on Workday platform have helped the former create apps that provide improved outcomes and healthier returns on investments for employees and employers. This collaboration is likely to have opened up a huge revenue-generating opportunity for Workday by enhancing its exposure to the lucrative employee benefits market.
In the quarter under review, Johns Hopkins University and Health System deployed Workday’s Human Capital Management (HCM) and Financial Management solutions to modernize its human resource and finance processes. HCM’s embedded AI capabilities have helped the institution automate routine HR tasks and free up employees for more intricate work, while the augmented analytics have delivered actionable insights for improved decision-making. The company has also been witnessing healthy traction in diverse industries and verticals, such as public and financial services. These improvements are expected to have had a favorable impact on fiscal fourth-quarter earnings.
Estimates for Workday
Our estimate for Subscription Services revenues is pegged at $2 billion, suggesting 15% year-over-year growth. Our estimate for Professional Services revenues is pegged at $154.5 million.
For the December quarter, the Zacks Consensus Estimate for revenues is pegged at $2.18 billion, suggesting an increase from the year-ago quarter’s reported figure of $1.92 billion. The consensus estimate for adjusted earnings per share is pegged at $1.75, indicating an increase from the $1.57 reported in the prior year.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Workday for the fiscal fourth quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.
Earnings ESP: Earnings ESP is -7.23%, which represents the difference between the Most Accurate Estimate of $1.63 and the Zacks Consensus Estimate of $1.75. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Workday, Inc. Price and EPS Surprise
Workday, Inc. price-eps-surprise | Workday, Inc. Quote
WDAY’s Zacks Rank: Workday currently carries a Zacks Rank #3.
Stocks to Consider
Marvell Technology MRVL is set to release quarterly numbers on March 3. It has an Earnings ESP of +2.77% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Backblaze Inc. BLZE is gearing up to release quarterly numbers on Feb. 25. It currently has an Earnings ESP of +3.03% and a Zacks Rank #2.
FTAI Aviation Ltd. FTAI is set to release quarterly numbers on Feb 26. It presently has an Earnings ESP of +8.16% and a Zacks Rank #2.
Just Released: Zacks Top 10 Stocks for 2025
Hurry – you can still get in early on our 10 top tickers for 2025. Handpicked by Zacks Director of Research Sheraz Mian, this portfolio has been stunningly and consistently successful. From inception in 2012 through November, 2024, the Zacks Top 10 Stocks gained +2,112.6%, more than QUADRUPLING the S&P 500’s +475.6%. Sheraz has combed through 4,400 companies covered by the Zacks Rank and handpicked the best 10 to buy and hold in 2025. You can still be among the first to see these just-released stocks with enormous potential.
Marvell Technology, Inc. (MRVL) : Free Stock Analysis Report
Workday, Inc. (WDAY) : Free Stock Analysis Report
FTAI Aviation Ltd. (FTAI) : Free Stock Analysis Report
Backblaze, Inc. (BLZE) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
