Shares in Workday (WDAY) popped Friday on first-quarter earnings and revenue that topped analyst estimates while the company’s outlook met expectations. WDAY stock signaled a breakout.
The enterprise software maker reported after the market close on Thursday. WDAY stock jumped nearly 9% to 214 in premarket trading on the stock market today.
For the three months ended April 30, Workday earnings were $1.31 a share on an adjusted basis, up 58% from the year-earlier period. Revenue climbed 17% to $1.68 billion, including acquisitions.
Analysts expected Workday earnings of $1.12 a share on revenue of $1.67 billion. A year earlier, Workday earnings were 83 cents a share on sales of $1.44 billion.
WDAY Stock: Subscription Revenue Up 20%
Pleasanton, Calif.-based Workday said subscription revenue rose 20% to $1.53 billion, edging by estimates of $1.52 billion.
“Workday reported Q1 (order) backlog growth of 23% ahead of guide of 20%, the strongest upside we’ve seen over the last couple of years,” TD Cowen analyst Derrick Wood said in a note to clients. “Strength was broad-based across geographies, with U.S. large enterprise a standout.”
For the current quarter ending in July, the software maker forecast subscription revenue of $1.612 billion at the midpoint of its outlook, in line with analyst views.
Meanwhile, Workday said it has brought in Zane Rowe as its new chief financial officer. Rowe had been CFO at VMware (VMW).
The company sells software for human capital management, such as payroll tools. Also, it has expanded into financial software.
WDAY stock holds a Relative Strength Rating of 91 out of a best-possible 99, according to IBD Stock checkup. WDAY stock has formed a cup base with an entry point of 206.78.
Thus far in 2023, WDAY stock has advanced 17%.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
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