Shares of Workday Inc (NASDAQ:WDAY) tanked in early trading on Wednesday, despite the company reporting solid fourth-quarter results.

Here are the key analyst insights:

• Guggenheim Securities analyst John DiFucci reiterated a Buy rating, while cutting the price target from $85 to $75.
• DA Davidson analyst Lucky Schreiner reaffirmed a Neutral rating, while trimming the price target from $150 to $125.
• BTIG analyst Allan Verkhovski reiterated a Buy rating, while slashing the price target from $230 to $175.
• Rosenblatt Securities analyst Robert Simmons maintained a Buy rating, while lowering the price target from $180 to $150.
• Needham analyst Scott Berg reaffirmed a Buy rating and price target of $300.

Check out other analyst stock ratings.

Guggenheim Securities: Workday reported total revenues of $2.532 billion, beating consensus of $2.52 billion. "By our estimates, New ACV (annual contract value) declined 8% y/y, representing a significant decline in business momentum measured on a 2-year stack basis, and in our view is reflective of deal delays called out by management," DiFucci said

The company lowered its subscription revenue guidance for the first quarter of fiscal 2027 to 13.4% year-on-year growth, from its prior outlook of about 14%. This means new ARR would decline 70%, he added.

DA Davidson: Workday reported its results broadly in-line with expectations, Schreiner said. Demand was impacted by deal delays "particularly from Federal, SLED, and healthcare customers among others with budget restraints," she added.

Subscription revenue grew around 16% year-on-year, accelerating by 100 basis points (bps) from the previous quarter, the analyst stated. Management's subscription revenue guidance for fiscal 2027 has a midpoint of $9,937.5 million, implying 12.5% growth and coming in "~50bp below initial commentary during last quarter’s earnings call," she further wrote.

BTIG: Workday's cRPO (current remaining performance obligations) grew 15.8%, beating the guidance midpoint by 30 bps, Verkhovski said. He added, however, that this represented the smallest beat since the first quarter of fiscal 2025.

Management's fiscal 2027 subscription revenue guidance reflects 12.5% growth at the midpoint, down from prior expectations of 13%, the analyst stated. "Similarly, the FY27 non GAAP operating margin guidance of 30%, which implies ~40 bps of Y/Y expansion, was below consensus of 31.2%," he further wrote.

Rosenblatt Securities: Workday's subscription revenue grew 15.7% year-on-year to $2.36 billion, coming in "just above guidance," Simmons said. He added, however, that out of the 120bps of acceleration, about 100 bps was inorganic and 70 bps was from one-time revenue.

Management's lowered fiscal 2027 guidance implies subscription revenue of $9.976 billion, down from $9.938 billion at the midpoint, the analyst stated. "We view this as consistent with the idea management expects to close most of the slipped deals this year," he further wrote.

Needham: Workday reported revenue and earnings of $2,532 million and $2.47 per share. It beat estimates of $2,523 million and $2.30 per share, respectively, Berg said. Total revenue grew 14.5%, driven by 15.7% subscription revenue growth, he added.

cRPO grew 15.8% year-on-year to $8.83 billion, decelerating from the previous quarter's 17.6% growth, the analyst stated. "Management intends to increase investment to take advantage of the agentic AI opportunity, pressuring near-term margins," he further wrote.

WDAY Price Action: Shares of Workday had declined by 3.87% to $125.18 at the time of publication on Wednesday.

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