Workday, Inc. has recently released its 10-Q report, providing a detailed overview of its financial performance and operations. The company, based in Pleasanton, California, offers a suite of enterprise cloud applications, including financial management, human capital management, planning, spend management, and analytics. Workday serves a diverse customer base across various industries, such as professional and business services, financial services, healthcare, education, government, technology, media, retail, and hospitality.
The company has achieved significant growth since its inception in 2005 and is currently a Fortune 500 company with more than 11,000 customers worldwide. Workday continues to focus on driving sustainable, long-term subscription revenue growth by adding new customers and expanding relationships with existing ones. This includes investing in strategic growth areas, such as developing innovative AI solutions, expanding internationally, growing the partner ecosystem, and exploring strategic acquisitions to complement organic innovation.
In the 10-Q report, Workday reported total revenues of $2.3 billion for the three months ended July 31, 2025, representing a 13% increase compared to the prior year period. Subscription services revenues, which accounted for approximately 92% of total revenues, were $2.2 billion for the same period, reflecting a 14% increase year-over-year. The company's GAAP operating income for the period was $248 million, marking a significant 123% increase from the prior year. Non-GAAP operating income also saw a notable 31% increase to $680 million.
As of July 31, 2025, Workday's total subscription revenue backlog stood at $25.4 billion, with $7.9 billion expected to be recognized in revenues over the next 12 months. This reflects an 18% increase in total subscription revenue backlog compared to the previous year. The company's gross revenue retention rate, a measure of recurring revenue retained from existing customers, was approximately 97% as of July 31, 2025, demonstrating strong customer satisfaction and retention.
Workday's costs and expenses for the three months ended July 31, 2025, included $370 million for costs of subscription services, $212 million for costs of professional services, $660 million for product development, and $641 million for sales and marketing. The company's focus on expanding operating margin is evident, with GAAP operating margin increasing to 10.6% and non-GAAP operating margin reaching 29.0% for the same period.
As a result of these announcements, the company's shares have moved -2.77% on the market, and are now trading at a price of $221.27. For more information, read the company's full 10-Q submission here.
