Subscription Revenue Reaches $2.47 Billion; AI Agents Provided to Over 5,500 Customer Organizations

Workday, an enterprise human resources and finance software company, recorded double-digit revenue growth in Q2 FY2027. The company raised its full-year outlook based on expanded AI agent business operations.

Workday announced its Q2 FY2027 results for the period ended July 31, recording total revenue of $2.649 billion. This represents a 12.8% increase compared to the same period last year.

Subscription revenue, the core business, reached $2.471 billion, a 13.9% increase year-over-year. Operating income was $313 million with an operating margin of 11.8%. Non-GAAP operating income was $824 million with an operating margin of 31.1%.

Non-GAAP diluted earnings per share (EPS) was $2.75, up from $2.21 in the same period last year.

Workday reported that over 5,500 customer organizations are currently using its AI agents, representing an increase of more than 35% compared to the previous quarter.

The company stated that AI is driving more than 25% of new annual contract value (ACV). Additionally, it unveiled the "Developer Agent," which enables developers to build AI applications using natural language, and "Agent Passport," an AI agent validation tool.

The company also announced expanded collaboration with AWS, integrating "Workday Data Cloud" with AWS data and AI services, and plans to expand AI agent integration with Google Cloud based on Gemini Enterprise.

Workday raised its full-year FY2027 subscription revenue guidance from $9.94 billion to approximately $9.95 billion. This represents approximately 13% growth compared to the prior year.

The company also raised its Non-GAAP operating margin guidance to 31.0% from its previous projection.

During the quarter, the company invested approximately $1.3 billion to repurchase 9.8 million Class A shares, and the board approved an additional share repurchase authorization of up to $4 billion.