Workday, Inc.: Will The Growth in the Medium Enterprise Market Benefit Their Top-Line In The Coming 3 Years?

Workday has reported solid financial performance for its first quarter fiscal 2025, noting a 19% subscription revenue growth and 18% 12-month backlog growth. Non-GAAP operating margin is at 26%. Despite some challenging dynamics in the quarter, such as increased deal scrutiny and slower customer headcount growth, Workday is encouraged by new go-to-market initiatives that are increasing total addressable market. Strategic deals, notably a federal win at the Defense Intelligence Agency, strengthen Workday’s momentum, and the company has seen positive feedback on product roadmaps. Health care and certain public sectors had strong performance, although large deals in EMEA were fewer than in previous quarters. The company’s guidance for the future reflects continued innovation in AI and growth of partner ecosystems, and the business remains stable.