• Bernstein upgraded Workday, Inc. (NASDAQ: WDAY) to "Outperform" with a revised price target of $298, reflecting confidence in the company's growth trajectory.
• Workday reported a 15% increase in subscription revenue and a 13% increase in total revenue for Q3 2026, with a notable non-GAAP operating margin of 28.5%.
• The company's strategic focus on AI integration and expansion efforts, including acquisitions and the enhancement of Workday GO, are key drivers of its strong performance.

Workday, Inc. (NASDAQ: WDAY) is a leading provider of enterprise cloud applications for finance and human resources. The company is known for its innovative solutions that integrate AI to enhance business operations. Workday competes with other major players in the software industry, such as Oracle and SAP, by offering comprehensive solutions that cater to various sectors, including healthcare and the public sector.

On November 26, 2025, Bernstein upgraded Workday's stock to "Outperform," with the stock priced at $233.69. Despite this positive outlook, Bernstein adjusted the price target from $304 to $298. This adjustment comes amid Workday's strong Q3 2026 performance, where subscription revenue increased by 15% year-over-year to $2.244 billion, and total revenue grew by 13% to $2.432 billion.

Workday's impressive non-GAAP operating margin of 28.5% highlights its operational efficiency. A key factor in this growth is the adoption of AI solutions, which contributed 1.5% to the annual recurring revenue growth. Notably, 75% of new sales included an AI solution, emphasizing Workday's strategic focus on artificial intelligence to drive business success.

The company's expansion efforts, such as the acquisition of Paradox, have strengthened its capabilities and contributed to the growth of committed recurring performance obligations. Additionally, the expansion of Workday GO, which now includes global payroll and an AI-powered deployment agent, aims to enhance offerings for medium enterprises, further solidifying Workday's market position.

Despite surpassing analyst expectations with earnings of $2.32 per share and slightly exceeding revenue forecasts, Workday's stock experienced a decline after the earnings report. The stock, priced at $233.69, has fluctuated between $226.45 and $236.80 today, with a market capitalization of approximately $62.4 billion. This volatility reflects the market's mixed reaction to the company's financial results and strategic initiatives.