AI Index / Workday, Inc.
Workday, Inc. (WDAY)
Workday’s revenue is primarily subscription-based from HCM and Core Financials (often sold as a full suite), plus professional services. Growth vectors include medium enterprise via Workday Go, public sector/federal projects (e.g., DIA), and international. AI contributes directly through paid add-ons and agents (Illuminate AI, Eversort, XtendPro, HiredScore, Paradox, Sana), with >75% of core customers using Illuminate and AI adding >1.5 pts to ARR this quarter. AI also enhances core products, but subscriptions to HCM/Finance remain the main driver.
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I'm pleased to report that Workday delivered solid Q3 results, with 15% subscription revenue growth and a 28% non-GAAP operating margin. Our teams executed well, and our value proposition is clearly resonating with organizations around the world. I've been on the road a lot lately, meeting with our customers and prospects, and they're all saying the same thing. They see the potential of AI, but they're stuck with disconnected systems, bad data, and closed platforms. That's where Workday gives them the ultimate advantage. By unifying HR and finance on one intelligent platform, we deliver business-ready AI that helps organizations adapt quickly, make better decisions, and deliver outcomes that truly matter.
- Carl Eschenbach
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Quotes from workday Executives About Artificial Intelligence and Generative AI
Just last week, we announced a major expansion of Workday Go, including global payroll, an expanded partner network, and a new AI deployment agent that can cut implementation time by up to 25%. Customers of all sizes and industries tell us that an investment in Workday is an investment in their AI strategy. More than 75% of our core customers are using Workday Illuminate AI, driving well over 1 billion AI actions on the Workday platform this year alone. And adoption keeps growing.
- Carl Eschenbach
Altogether, our AI products added more than one and a half points of ARR growth this quarter.
- Carl Eschenbach
And with the rollout of flex credits early next year, we're making it even easier for our customers to adopt our AI and platform innovation.
- Carl Eschenbach
We introduced new Illuminate agents that tackle some of the toughest challenges at work, from performance reviews and workforce planning to financial close. These purpose-built agents are powered by our unmatched HR and financial data and context, which is what makes them highly accurate, actionable, and trusted.
- Carl Eschenbach
At the same time, we're opening up our platform so customers and partners can create their own AI-powered apps and agents with Workday build.
- Carl Eschenbach
We just closed our acquisition of Sana, an AI-native platform with an incredible team. They're going to help us completely reimagine our user experience for the age of AI. Our vision is very simple and straightforward. Make Workday the new front door to work by bringing together enterprise knowledge, AI agents, and all the HR and finance processes our customers run every day.
- Carl Eschenbach
And Sana Learn brings hyper-personalized skill development and AI-generated content creation to Workday Learning.
- Carl Eschenbach
Last week, we announced the intent to acquire Pipedream, a low-code integration platform for AI agents with more than 3,000 prebuilt connectors to the world's most widely used business applications like Asana, Jira, and Slack. When you combine that reach with Workday's trusted data, deep business context, and the capabilities from Sana and Flowise, our agents move from surfacing insights to truly getting work done.
- Carl Eschenbach
Although other vendors are confusing the market with thousands of overlapping, general-purpose agents, we're focused on what we do best. And that is building powerful agents for HR and finance that deliver real ROI and measurable business value.
- Carl Eschenbach
We just wrapped up our largest EMEA rising yet. There, we announced the new Workday EU sovereign cloud, which will let customers run our AI-powered HR and finance solutions entirely within the EU, keeping their data local, secure, and fully controlled.
- Carl Eschenbach
Also in Q3, we established a new AI center of excellence in Dublin, which is one of our major R&D hubs.
- Carl Eschenbach
We're living in a new era of work, powered by AI and built on trust. And Workday is made for this moment.
- Carl Eschenbach
These statements are subject to risks, uncertainties, and assumptions that could cause actual results to differ materially.
- Justin Allen Furby