Shares of Workday (WDAY) skyrocketed 11.81% in after-hours trading on Tuesday following the release of its better-than-expected fiscal fourth-quarter 2025 results and a promising outlook for the year ahead.

The leading provider of cloud-based human resources and financial management software solutions reported an adjusted earnings per share (EPS) of $1.92, surpassing analysts' estimates of $1.78. Total revenue for the quarter jumped by 15% year-over-year to $2.21 billion, exceeding expectations of $2.18 billion.

The strong performance was driven by a 15.9% increase in subscription revenue, which reached $2.04 billion, reflecting sustained demand for Workday's innovative product offerings. The company's focus on integrating artificial intelligence (AI) across its platforms, including the recently launched Workday Agent System of Record, is expected to further enhance operational efficiency and customer value.

Looking ahead, Workday provided an optimistic fiscal 2026 outlook, projecting subscription revenue growth of 14% to $8.8 billion and an improved non-GAAP operating margin of approximately 28%. This bullish guidance, coupled with the company's strategic emphasis on AI innovation and international expansion, has fueled investor confidence in Workday's long-term growth prospects.

Additionally, Workday announced the appointment of Gerrit Kazmaier as the new President of Product and Technology, effective March 10. Kazmaier brings extensive experience in driving innovation in enterprise software and AI transformation from his previous roles at Google Cloud and SAP, further strengthening Workday's AI capabilities.