Workday Jumps After Signaling New Focus on Profitability
- Company’s quarterly results, outlook disappointed initially
- Software company says greater use of AI will help cut expenses
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Workday Inc. shares surged after executives said the software company would sharply increase profitability over the next three years.
Adjusted operating margin will reach 30% by the fiscal year ending in January 2027, Chief Financial Officer Zane Rowe said on a conference call Thursday to discuss quarterly results. During an event last year, Workday had said that figure would be 25%. Subscription revenue growth — which makes up most of Workday’s total sales — will be about 15% in the coming fiscal years, Rowe said.