Live: Workday Reports Q1 Earnings Tonight in First Quarter Under Returning CEO

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Workday's Guidance Will Likely Drive the Stock's Reaction

1 minute ago

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Tonight’s headline revenue and EPS numbers are likely going to matter less than what Workday (NASDAQ:WDAY | WDAY Price Prediction) says about the road ahead.

Management’s own Q1 guidance calls for subscription revenue near $2.335 billion, 13% growth, with a 30.5% non-GAAP operating margin. The FY27 revenue frame sits at $9.925B–$9.950B, a deceleration from 13.09% in FY26.

Management has historically guided conservatively, with revenue beating by about 0.28%–1.05% across FY26.

Bullish case: A raise above the $9.95B ceiling, margin guide above 30%, sustained 15%+ backlog growth, and concrete agentic AI revenue detail.

Bearish case: Holding near the low end of revenue guidance, sub-30% margins, 12-month backlog deceleration from $8.83B, or vague AI timing. With shares down 41.05% YTD, the guide carries the night.

Workday's Bull vs Bear Case Heading Into Tonight's Q1 Report

4 minutes ago

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With Workday (NASDAQ:WDAY) reporting tonight at 4:00 PM ET after the close, prediction markets imply an 87.5% beat probability against a $2.52 non-GAAP EPS consensus.

Bull Case

• Seven consecutive beats, with Q4 delivering $2.47 vs. $2.32.
• Margin expansion: Q4 non-GAAP operating margin hit 30.6%; CRPO backlog $8.83 billion, up 15.8%.
• AI traction: over $100 million in Q4 emerging-AI ACV, growing over 100% year-over-year.
• Insider activity skews towards net buying.

Bear Case

• FY27 subscription guide of 12% to 13% decelerates from FY26.
• Shares are down 53.76% over one year, signaling skepticism.
• Net new deals are lengthening across the federal, healthcare, and commercial segments.
• Q1 FY26 fell 12.52% on a beat, proving guidance tone matters most.

Workday's Q1 Earnings Need to Validate the AI Pivot

45 minutes ago

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Workday’s Q1 earnings report tonight carries more weight because management already told investors meaningful AI agent revenue will likely arrive later in the year.

That means Q1 needs to show enough traction in subscription growth, AI contract value, and margins to keep investors confident in the transition story.

With shares down sharply over the past year, sentiment could improve quickly if Workday delivers stable growth and reinforces its second-half AI outlook. A weaker report would raise bigger questions around how quickly AI investments can translate into real financial results.

Investors are watching Workday (NASDAQ:WDAY) ahead of its fiscal first-quarter results expected after the bell today, May 21, 2026 at 4:00 PM ET. With a new CEO and an AI pivot underway, this report carries unusual weight.

An AI Reset Under a Returning Founder

Co-founder Aneel Bhusri returned as CEO, replacing Carl Eschenbach, and used the Q4 FY26 call to frame what he called “Chapter 4”, a renewed focus on innovation and agentic AI inside HR and finance workflows.

Last quarter set a high bar. Q4 FY26 revenue came in at $2.532 billion, beating the $2.523 billion estimate, with non-GAAP EPS of $2.47 versus $2.32 expected. Subscription revenue rose 16%, and the company closed FY26 with $2.78 billion in free cash flow, up 27%. Yet shares have struggled, down 41.05% year to date and 53.76% over the past year, as investors weigh whether AI investment will pressure margins before it drives the next leg of growth.

Q1 FY27 Company Guidance and Full-Year Targets

Prior-year Q1 revenue was $2.240 billion with EPS of $2.23.

Agentic AI Traction Will Set the Tone

I will be watching three things closely tonight. First, agentic AI monetization. Workday delivered 1.7 billion AI actions in FY26 and generated over $100 million in new annual contract value from emerging AI products in Q4, with ARR from those solutions now over $400 million. Any progress on the 12 organically built role-based agents moving to general availability will matter.

Second, deal cycles. Enslin acknowledged that some net-new large enterprise deals are taking longer to close, particularly in federal, state, and local governments and healthcare. Investors will look for whether those pipelines were converted in Q1.

Third, the margin trajectory. Workday’s CFO, Zane Rowe, flagged that Workday is prioritizing incremental investments in its agentic AI roadmap, meaning margin expansion will slow in the near term. The 30.5% Q1 target is the line in the sand.

Context heading in: Workday has beaten EPS and revenue in all four quarters of FY26, and Polymarket traders put the beat probability at 87.5%. Insider activity skews toward retention grants rather than open-market selling.