Workday, the provider of corporate HR and financial software, reported impressive financial results for the fiscal third quarter ended October. The company’s revenue reached $1.87 billion, a 17% increase compared to the same period last year. This figure surpassed both the company’s guidance range of $1.843 billion to $1.845 billion and the Street consensus of $1.85 billion.
Adjusted profits also exceeded expectations, coming in at $1.53 per share, higher than the Wall Street consensus of $1.41. Under generally accepted accounting principles, earnings per share were 43 cents.
In terms of subscription revenue, Workday generated $1.69 billion, marking an 18% growth. This result outperformed the company’s own forecast of 17% growth. The subscription backlog increased to $18.45 billion, representing a significant 30.9% rise from the previous year.
Co-CEO Carl Eschenbach expressed his satisfaction with these results, stating, “More companies around the world are turning to Workday to manage their most precious assets: their people and money.”
Looking ahead to the fiscal year of January 2024, Workday raised its subscription revenue outlook to $6.598 billion. This figure exceeds its previous prediction range of $6.57 billion to $6.59 billion.
Analysts’ consensus estimates forecast total revenue of $7.2 billion and non-GAAP profit of $5.61 per share for the same period. In a meeting with analysts in September, Workday adjusted its three-year forecast for annual subscription revenue growth, narrowing it down to between 17% and 19% from the previous forecast of over 20%.
Following the release of these positive results, Workday shares experienced a 3.2% increase in after-hours trading. Year-to-date, the stock has gained significant ground, rising 42% through the close of regular trading on Tuesday.