Workday stock surges on boosted subscription revenue

The Yahoo Finance Live team discusses the rise of Workday stock on subscription revenue.

Video transcript

DIANE KING HALL: Let's switch gears. Let's talk about another stock and focus today on Workday. That's now getting a boost up about 8%. The company reported a beat on the top and bottom line after hours on Thursday, as well as major gains in its closely watched subscription revenue.

The enterprise software company also saw non-GAAP operating margin of 23 and 1/2% beating its own expectations of 21.5%. So you're seeing that stock being rewarded. Workday also mentioned AI.

JULIE HYMAN: Everyone says it. Why wouldn't it mention AI? A lot of these companies, at least, that are mentioning AI at this point, it makes some sense. When you have a Pepsi mentioning AI, they're just throwing it in there. And yes, they're working on something legitimately. But nonetheless, something like Workday makes sense.

The subscription revenue for Workday, it lifted the lower end of its forecast for subscription revenue. And that's really its bread and butter. That recurring subscription revenue. So that seems to be positive here. Interesting small note here on an executive change at the company, it's getting a new chief financial officer. Zane Rowe, who was the CFO at VMware. The person who had been in that role, Barbara Larson, only had been in call it a year and a half or so. She'd been at the company for a while, but only as CFO for about a year and a half. So just--

DIANE KING HALL: A little c-suite.

JULIE HYMAN: A little change. Exactly.

DIANE KING HALL: Yeah.