Key Takeaways
- Workday stock is trading around $215.89 today, up fractionally after a sharp selloff earlier in the week, with intraday trading between roughly $214 and $218 and a market value near $61 billion. [1]
- Fiscal 2026 third‑quarter results beat Wall Street estimates on both earnings and total revenue, with subscription revenue growing in the mid‑teens and AI products a key driver of demand. [2]
- Guidance disappointed investors: Q4 subscription revenue and margin outlook came in only slightly above Street expectations, while management flagged softer demand in some higher‑education customers, triggering an almost 8% drop in WDAY shares this week. [3]
- Analysts remain broadly positive: MarketBeat counts 2 Strong Buy, 25 Buy and 11 Hold ratings on Workday, with an average price target around $282.70—well above today’s price. [4]
- The long‑term story still revolves around AI and platform scale, supported by acquisitions like Paradox and Sana, a new AI hub in Dublin, a large buyback plan, and ongoing restructuring to fund AI investment. [5]
Workday Stock Price Today: Stabilizing After the Shock
As of trading on Friday, November 28, 2025, Workday, Inc. (NASDAQ: WDAY) is changing hands at about $215.89 per share, up roughly 0.3% on the day. The stock has traded between $214.05 and $217.65 in today’s session, with volume just under 1 million shares. Workday’s current market capitalization sits around $61.2 billion.
The modest rebound follows a bruising mid‑week session. Earlier this week, WDAY plunged close to 8% after its latest earnings report and forward guidance, with one analysis pegging the price around $215 on November 26 following a –7.9% daily move. [6] Another report noted the stock fell about 7.85% to $215.34, snapping a three‑day winning streak and marking the biggest decline among S&P 500 constituents that day. [7]
Despite today’s stability, Workday stock remains well below its 52‑week peak. Recent market data show a 52‑week high near $294 and a low just above $205, leaving the shares roughly a quarter below their highs and only modestly above their year‑on‑year floor. [8]
Q3 Fiscal 2026: A Strong Quarter on the Surface
Workday’s latest move started with what, at first glance, looked like a solid quarter.
For its fiscal 2026 third quarter (ended October 31, 2025), Workday reported: [9]
- Total revenue: $2.432 billion, up 12.6% year‑over‑year
- Subscription revenue: $2.244 billion, up 14.6% year‑over‑year
- GAAP operating income: $259 million (10.7% margin), vs. $165 million (7.6%) a year ago
- Non‑GAAP operating income: $692 million (28.5% margin), vs. $569 million (26.3%) a year ago
- GAAP diluted EPS: $0.94, up from $0.72
- Non‑GAAP diluted EPS: $2.32, up from $1.89
That $2.32 non‑GAAP EPS comfortably beat Wall Street expectations, which clustered around $2.17–$2.18, producing an earnings surprise of nearly 9%. [10] Total revenue also edged past consensus estimates of about $2.42 billion.
The demand pipeline looked equally robust:
- 12‑month subscription revenue backlog: $8.21 billion, up 17.6% year‑on‑year
- Total subscription revenue backlog: $25.96 billion, up 17.0%
- Operating cash flow: $588 million, vs. $406 million a year ago
- Free cash flow: $550 million, vs. $359 million
- Share repurchases: 3.4 million shares bought back for $803 million
- Cash, cash equivalents and marketable securities: $6.84 billion as of October 31, 2025 [11]
On guidance, CFO Zane Rowe nudged expectations higher, telling investors Workday now forecasts fiscal 2026 subscription revenue of $8.828 billion, implying ~14% growth, and non‑GAAP operating margin of roughly 29%. [12] That’s a slight upgrade from the company’s earlier full‑year guidance, which had called for $8.8 billion in subscription revenue and a 28% non‑GAAP operating margin. [13]
CEO Carl Eschenbach credited the quarter’s performance to broad‑based demand and momentum across Workday’s AI portfolio, positioning the company as an “enterprise AI platform” for managing people, money and intelligent agents on a single cloud system. [14]
So Why Did Workday Stock Drop So Hard?
Given the beat on both earnings and revenue, the post‑earnings slide in WDAY stock was driven largely by what the market saw in the forward outlook, not the backward‑looking numbers.
According to Reuters, Workday’s third‑quarter subscription revenue came in exactly in line with Wall Street estimates, and its fourth‑quarter subscription revenue forecast of about $2.36 billion was only marginally above the roughly $2.35 billion consensus—technically a beat, but barely. [15]
A deeper look from TIKR notes that management guided to a non‑GAAP operating margin of at least 28.5% for Q4, slightly below a consensus estimate around 28.7%. [16] That small shortfall on margin, combined with the only modest upside on subscription revenue, was enough to sour sentiment for a premium‑valued software name.
Workday also acknowledged pockets of demand softness, particularly among higher‑education customers reliant on federal funding, where budget uncertainty has slowed decision‑making and deployments. [17] More broadly, the company sees some customers reassessing the timing of large cloud platform investments against a still‑uncertain macro backdrop.
For a stock that recently traded near $300 and is widely viewed as a high‑multiple growth name, even small disappointments on growth or margins can trigger large price moves—which is essentially what played out in WDAY’s near‑8% drop this week. [18]
AI Momentum: The Core of the Bull Case
Despite the guidance jitters, the long‑term Workday story remains centered on AI and platform depth.
In its Q3 release and at the Workday Rising customer conference, the company highlighted a series of AI‑driven initiatives, including: [19]
- Workday Illuminate™ AI agents
- Workday Data Cloud, a new data layer to unlock analytics and AI personalization
- Workday Build, an open developer experience to extend the platform
- Workday Flex Credits, a new subscription‑based model for consuming AI capabilities
Workday also opened an AI Centre of Excellence in Dublin, committing €175 million over three years and creating 200 specialized AI roles, underscoring the scale of its investment. [20]
A detailed earnings recap from TIKR and other outlets highlights just how central AI has become: management pointed out that AI‑related products contributed more than a point of ARR growth, with over 1 billion AI actions executed on the platform year‑to‑date and AI features included in a large majority of new and expansion deals. [21]
On the M&A side, Workday recently closed its acquisition of conversational AI recruiting platform Paradox and announced plans to buy AI learning startup Sana for about $1.1 billion, shoring up its capabilities in talent acquisition and skills development. [22]
In September, Elliott Management disclosed a roughly $2 billion stake in Workday, publicly endorsing the company’s leadership and long‑term AI strategy. At the same time, Workday rolled out a $5 billion share repurchase plan running through fiscal 2027, signaling confidence in its cash‑generation potential. [23]
Analyst Ratings, Targets and Valuation
Despite the selloff, Wall Street remains mostly constructive on Workday stock (WDAY).
A fresh roundup from MarketBeat shows: [24]
- 2 analysts rating the stock Strong Buy
- 25 analysts rating it Buy
- 11 analysts rating it Hold
That mix produces an overall “Moderate Buy” consensus rating, with an average price target around $282.70—roughly 30%+ above today’s trading level.
Drilling into individual calls:
- DA Davidson recently projected fiscal Q4 2026 EPS of about $1.10, assigning Workday a “Neutral” rating and $250 price target. [25]
- Several other firms, including Bank of America, JPMorgan, Bernstein and Citigroup, have trimmed their price targets but largely maintained positive or overweight stances, with targets clustering in the $247–$298 range. [26]
There is some spread in aggregated targets: TIKR cites a typical target near $278, while a snapshot on Yahoo Finance references a somewhat lower $259 target. [27] The common theme: even after this week’s drop, most models still embed meaningful upside over a multi‑year horizon—assuming Workday can hit its growth and margin goals.
On valuation, MarketBeat’s profile (based on recent trading near $215) pegs Workday at a trailing P/E ratio of about 90×, with a price‑to‑earnings‑growth (PEG) ratio around 2.9 and a beta near 1.1, highlighting both its growth orientation and above‑market volatility. [28] With today’s intraday data showing a market cap around $61.2 billion, investors are clearly still paying a premium multiple for Workday’s cloud and AI exposure. [29]
Ownership, Restructuring and Competitive Landscape
The shareholder base and operating backdrop also color how investors interpret the latest guidance.
Institutional ownership is high: MarketBeat data suggests that about 89.8% of Workday’s stock is held by institutions, including significant positions from First Eagle Investment Management, Nuveen, Hotchkis & Wiley, Norges Bank and T. Rowe Price, several of which have added to their positions in recent periods. [30]
At the same time, insiders have been net sellers. Over the last ninety days, executives and directors have sold roughly 264,933 shares, worth about $61.5 million, including transactions by CFO Zane Rowe and director Michael McNamara. [31] Insider selling is common in large tech companies where equity is a big part of compensation, but it can still reinforce market concerns when it coincides with a guidance‑driven pullback.
Operationally, Workday is in the midst of a major restructuring. Early this year, the company said it would eliminate about 1,750 roles (around 8.5% of its workforce) as part of a plan to redirect spending toward AI and platform initiatives. Management expects total restructuring charges between $230 million and $270 million, split across late fiscal 2025 and early fiscal 2026, with some impact on GAAP profitability. [32]
In the market, Workday competes with Oracle, SAP and payroll giant ADP, and counts blue‑chip names like United Airlines, Visa and FedEx among its customers. [33] Reuters notes that some enterprise clients are tightening budgets and reassessing the timing of major cloud deployments, feeding into Workday’s more cautious subscription guidance. [34]
At its 2025 analyst events and earnings calls, management has reiterated a mid‑term framework featuring roughly mid‑teens subscription revenue growth and non‑GAAP operating margins around 30%, suggesting that the current wave of AI hiring, product launches and M&A is aimed squarely at sustaining that balance of growth and profitability. [35]
What Today’s Price Action May Be Signaling
Today’s small uptick in WDAY stock—a move of roughly +0.3% after Wednesday’s near‑8% drop—leaves the shares essentially treading water relative to their post‑earnings close. [36] The initial shock from the guidance appears to have been absorbed, but not fully reversed.
In the near term, Workday looks caught between:
- Strong fundamentals: double‑digit revenue and subscription growth, expanding margins, robust backlog, improving free cash flow and a substantial share buyback. [37]
- Lingering concerns: macro‑sensitive demand in certain verticals, slightly softer‑than‑hoped margin guidance, ongoing restructuring costs and a still‑rich valuation multiple that leaves little room for execution missteps. [38]
Over the next few quarters, investors monitoring Workday stock today and going forward are likely to focus on several key questions:
- Can subscription revenue stay in the mid‑teens growth range despite budget tightening among higher‑education and some large enterprise customers? [39]
- Do AI modules translate into higher revenue per customer and stickier relationships, rather than just one‑off deal wins? [40]
- Will Workday hit its 29–30% non‑GAAP operating margin ambition while funding aggressive AI hiring, acquisitions and a global AI build‑out? [41]
- How quickly will the $5 billion buyback and Elliott’s involvement show up in per‑share metrics and capital‑allocation decisions? [42]
- What does the next earnings call say about fiscal 2027 and beyond, particularly around AI monetization, international expansion and competitive dynamics with Oracle and SAP? [43]
For now, Workday remains a profitable, cash‑generating, AI‑heavy enterprise software company trading at a premium multiple. Whether that premium holds—or compresses further—will depend on how convincingly management can prove that AI investments, acquisitions and restructuring efforts will translate into durable growth and sustained margin expansion rather than just a temporary boost in headlines.
Disclaimer: This article is for informational and news purposes only and does not constitute financial or investment advice, an offer, or a recommendation to buy or sell any security. Always do your own research or consult a licensed financial advisor before making investment decisions.
References
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