Q4 2026 Workday Inc Earnings Call Transcript
Key Points
- Workday Inc (WDAY) reported strong subscription revenue growth of 16% in Q4 and 14% for the full fiscal year 2026.
- The company achieved over $100 million in new ACV from emerging AI products in Q4, growing over 100% year-over-year.
- Workday Inc (WDAY) has successfully integrated recent acquisitions like Sana into its platform, enhancing its AI capabilities.
- The company maintains a high gross revenue retention rate of 97%, reflecting strong customer satisfaction and trust.
- Workday Inc (WDAY) is focusing on innovation with AI, aiming to transform HR and finance processes, which is expected to drive future growth.
- Some large enterprise deals are taking longer to close, particularly in sectors like federal, state, and healthcare.
- The guidance for fiscal year 2027 subscription revenue growth is set at 12% to 13%, which some analysts view as conservative.
- There is a sequential decline in Q1 subscription revenue expected due to the non-recurring DIA contract impact.
- Workday Inc (WDAY) is facing challenges in accelerating net new large enterprise deals, impacting the volume of new deals closed in Q4.
- The company is prioritizing incremental investments in AI, which may slow down near-term GAAP and non-GAAP margin expansion.
Ladies and gentlemen, welcome to Workday's fourth-quarter fiscal year '26 earnings call. (Operator Instructions)
I will now hand the call over to Justin Furby, Vice President of Investor Relations. Please go ahead.
Thank you, operator. Welcome to Workday's fourth-quarter fiscal 2026 earnings conference call. On the call, we have Aneel Bhusri, our CEO; Gerrit Kazmaier, our President, Products and Technology; Rob Enslin, our President and Chief Commercial Officer; and Zane Rowe, our CFO.
Following prepared remarks, we will take questions. Our press release was issued after close of market and is posted on our website, where this call is being simultaneously webcast. Before we get started, we want to emphasize that some of our statements on this call, particularly our guidance, are based on the information we have as of today and include forward-looking statements regarding our financial results, applications, customer demand, operations and other matters. These statements are
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