Workday, Inc. has announced its fiscal 2025 second-quarter financial results, revealing a 16.7% year-over-year increase in total revenues to $2.085 billion. Subscription revenues also saw a significant rise, up 17.2% to $1.903 billion compared to the same period last year.
Operating income for the quarter was $111 million, representing 5.3% of revenues, a notable improvement from the $36 million, or 2.0% of revenues, reported in the second quarter of fiscal 2024. Additionally, non-GAAP operating income for the second quarter increased to $518 million, or 24.9% of revenues, from $421 million, or 23.6% of revenues, in the same period last year.
Diluted net income per share rose to $0.49 from $0.30 in the second quarter of fiscal 2024, while non-GAAP diluted net income per share increased to $1.75 from $1.43 in the same period last year.
The 12-month subscription revenue backlog was reported at $6.80 billion, reflecting a 16.1% increase from the same period last year. Furthermore, the total subscription revenue backlog stood at $21.58 billion, marking a substantial 20.9% year-over-year growth.
Operating cash flows for the quarter were $571 million, up from $425 million in the prior year, with free cash flows also showing an increase to $516 million compared to $360 million in the prior year.
The company repurchased approximately 1.4 million shares of class A common stock for $309 million as part of its share repurchase program, and as of July 31, 2024, held cash, cash equivalents, and marketable securities totaling $7.37 billion.
In terms of fiscal 2025 full-year guidance, Workday updated its subscription revenue to between $7.700 billion and $7.725 billion, representing a growth of approximately 17%, and non-GAAP operating margin of 25.25%.
The company also provided guidance for the fiscal 2025 third quarter ending October 31, 2024, with a projected subscription revenue of $1.955 billion, representing growth of 16%, and a non-GAAP operating margin of 25.25%.
Workday's recent achievements include joining the Fortune 500 list for the first time, surpassing 70 million users under contract, and adding over 2,000 Workday Financial Management customers. The company also announced strategic partnerships, including collaborations with Equifax, Salesforce, and Kainos, and was recognized as a leader in the Forrester Wave™ for Enterprise Resource Planning Solutions for service-centric industries, Q2 2024.
As a result of these announcements, the company's shares have moved -1.0% on the market, and are now trading at a price of $231.08. For the full picture, make sure to review Workday's 8-K report.
