Workday Inc (NASDAQ:WDAY) stock fell 11.30% (As on May 23, 11:25:29 AM UTC-4, Source: Google Finance) after the company delivered better-than-expected revenue and reaffirmed its full-year outlook on subscription sales, but its guidance for the current quarter did not impress investors very much. Subscription revenue, which makes up the bulk of the company’s sales, also rose 13% from a year earlier, to $2.06 billion. Workday was able to eke out a net profit of $68 million in the quarter, lower than the $107 million in net income it recorded in the year-ago period. Non-GAAP operating income for the first quarter was $677 million, or 30.2% of revenues, compared to a non-GAAP operating income of $515 million, or 25.9% of revenues, in the same period last year. 12-month subscription revenue backlog was $7.63 billion, up 15.6% from the same period last year. Total subscription revenue backlog was $24.62 billion, increasing 19.1% year-over-year. Operating cash flows were $457 million compared to $372 million in the prior year. Free cash flows were $421 million compared to $291 million in the prior year. Workday saw notable industry growth in Q1, with the technology & media and manufacturing verticals each crossing $1 billion in annual recurring revenue.

WDAY in the first quarter of FY26 has reported the adjusted earnings per share of $2.23, beating the analysts’ estimates for the adjusted earnings per share of $2.01. The company had reported the adjusted revenue growth of 12.6 percent to $2.24 billion in the first quarter of FY26, beating the analysts’ estimates for revenue of $2.22 billion.

Meanwhile, the company has continued its international expansion by going live on the AWS U.K. public cloud and announcing a new location for its EMEA headquarters in Dublin. Workday welcomed new customers including Dover Corporation, Mutual of Omaha Insurance Company, and United Airlines, and expanded existing relationships with ASDA stores, Chipotle, CVS Health, and Decathlon.

Additionally, the company has approved a new share repurchase program to repurchase up to an additional $1.0 billion of shares of its Class A common stock. Workday repurchased approximately 1.3 million shares of Class A common stock for $293 million as part of its share repurchase programs.

For the fiscal 2026 second quarter, the company expects Subscription revenue to be of $2.160 billion, representing growth of 13.5% and Non-GAAP operating margin to be of 28.0%

For the fiscal 2026 full year ending January 31, 2026, the company expects Subscription revenue to be of $8.800 billion, representing growth of 14.0% and Non-GAAP operating margin to be of 28.5%.