Workday Announces Q1 Results Following Growth of AI Strategy

Workday has announced its fiscal 2027 first quarter results, sharing total revenues of US$2.54bn – up 13.5% year-over-year. 

The results follow a period of change for Workday, which saw layoffs that impacted 2% of staff and a CEO transition, with Co-Founder Aneel Bhusri returning to the role. 

“We had a great Q1, and it makes one thing clear: Workday is ready for this AI moment,” says Aneel. “Our core business is strong, our AI strategy is working and we're moving with the speed and focus required to lead.

“I am very excited about Workday's position and our path ahead. We have the platform, the trust and the innovation to lead this next chapter, just as we did when we founded the company.”

Ongoing customer adoption

According to Zane Rowe, Chief Financial Officer of Workday, the company’s results demonstrate “ongoing customer adoption across our platform,” as companies increasingly turn to the company’s platform to “manage and empower their most important assets.” 

Subscription revenues were US$2.354 for the first fiscal quarter – an increase of 14.3% from the same period the previous year. 

Its 12-month subscription revenue backlog also reached US$8.806bn, up 15.5% from the same period last year, while the total subscription revenue backlog was US$27.294bn – increasing 10.9%. 

“We are reiterating our fiscal 2027 subscription revenue outlook of US$9.925bn to US$9.950bn, while increasing our fiscal 2027 non-GAAP operating margin guidance to 30.5%,” says Zane. “Our focus remains on executing on our agentic AI roadmap while driving operational efficiencies as we scale.”

The number of customers using Workday’s organically developed agents has also increased, more than doubling quarter-over-quarter. According to Workday at the time of release, over 4,000 customers are using at least one of these agents to support their business processes. 

Expansion across Q1

Workday has welcomed several new high profile customers over the course of its first fiscal quarter – such as ACHM Hotels by Marriott and the Australian Gas Infrastructure Group – and has expanded existing relationships with Bank OZK, GE Vernova and Microsoft. 

The company has also announced several new product offerings, such as Sana, the Workday Agent System of Record and its Military Skills Mapper, designed to help companies more effectively identify and hire military veteran talent. 

Tools such as these have been created to better streamline hiring, finance and IT processes, with Joe Wilson, Global Chief Technology Officer of Workday, saying of the Military Skills Mapper: “Veterans bring hard-earned skills – leadership, adaptability and teamwork – that don't always show up clearly in traditional hiring processes. 

“With the Military Skills Mapper, we're using Workday innovation to make those capabilities unmistakably visible to the organisations that need them most.”

Aneel Bhursi returns

During the company’s first fiscal quarter, Carl Eschenbach stepped down as CEO following the announcement of plans to eliminate “non-revenue generating” customer roles – impacting around 2% of the company’s total workforce. 

Upon his return, he said: "It's both humbling and energising to step back into this role at such a pivotal time for our company and our industry.

"AI is reshaping how work gets done and represents an even bigger transformation than the shift to cloud 20 years ago. Just as we helped redefine enterprise software when we founded Workday, I believe we can once again lead the way in this AI era."