Workday posts strong earnings and revenue amid rapid uptake of its AI agents

Human resources management software company Workday Inc. reported better-than-expected second-quarter results today, delivering earnings and revenue above expectations and raising its guidance for the full year.

The results barely moved the needle, though, as the company’s stock remained flat after-hours, having closed up about 1.5% prior to today’s report.

The company delivered earnings before certain costs such as stock compensation of $2.75 per share, easily beating Wall Street’s projected target of $2.61 per share. The revenue beat was less impressive, but with sales coming to $2.65 billion, it still beat the analyst consensus estimate of $2.64 billion. The company ended the quarter with net income of $632 million, up from just $228 million in the same period one year earlier.

Workday said its 12-month subscription revenue backlog ended the quarter at $9.03 billion, up 14.2% from a year earlier. Meanwhile, its total subscription revenue backlog rose 8%, to $27.4 billion.

Co-founder and Chief Executive Aneel Bhusri (pictured) said the results are evidence that the company’s bet on artificial intelligence agents is beginning to pay off, despite concerns that the rise of AI models could disrupt its business. “We have a strong Q2, with AI driving more than 25% of our new ACV and more than 5,500 customers now using at least one of our organic agents,” he said. “Because of Workday’s deterministic rails, customers can trust our agents with the work that matters, and you’re seeing that in the numbers.”