Workday Shares Decline 0.53% as $700M Trading Volume Ranks 118th Despite Outperforming Earnings Estimates

On August 28, 2025, Workday (WDAY) closed with a 0.53% decline, trading at $228.90. The stock saw a volume of $0.7 billion, ranking 118th in trading activity that day. The selloff followed mixed reactions to its Q2 earnings report, despite revenue and profitability outperforming expectations.

Workday reported revenue of $2.35 billion, in line with forecasts, while non-GAAP earnings per share exceeded estimates by 4.5%. The company highlighted robust adoption of AI-driven tools like Workday Illuminate, with over 70% of clients incorporating AI features. Management also noted strong growth in public sector contracts, healthcare, and international markets, particularly in Europe. However, concerns lingered over funding challenges in segments like state and local government and higher education.

Analyst questions during the earnings call underscored key risks. Leaders dismissed fears of disruption from AI startups but acknowledged macroeconomic pressures in SLED (state, local government, and education) markets. Strategic moves, such as forming Workday Government as a subsidiary to secure federal contracts, were framed as responses to client security demands. Meanwhile, the acquisition of Paradox was positioned as a catalyst for AI-powered recruiting capabilities, though integration challenges remain a watchpoint.

Investors remain cautious about sustaining momentum. Upcoming focus areas include the scalability of AI adoption, international expansion in India and Japan, and federal sector performance post-Workday Government launch. The partner channel, contributing over 20% of new annual contract value, is seen as a growth lever, though its long-term viability requires monitoring.

Query limit exceeded.