An estimates-trouncing quarter was the key reason behind Workday (WDAY 0.89%) stock's very good final workday of the week. On Friday, shares of the cloud-based business applications company soared to close more than 9% higher.
In the second quarter of Workday's fiscal 2022, the company earned total revenue of $1.26 billion. This represented muscular year-over-year growth of nearly 19%. It also beat the average analyst estimate of $1.24 billion. It was fueled mainly by a nearly 20% rise in subscription revenue, which came in at $1.11 billion.
Workday recorded a more thumping beat on the bottom line by simply keeping its net income more or less steady compared to the year-ago quarter. This landed at just under $320 million, or $1.23 per diluted share. The collective prognosticator forecast was only $0.78.
"Our business continues to accelerate, fueled by growing demand from large enterprise customers for our industry leading HR, finance, and planning solutions to drive transformation at scale," Workday co-CEO Chano Fernandez said in a statement.
Fernandez added, "we are well positioned for the second half of the year and will continue to invest in our go-to-market strategy and our people, who are foundational to our success."
Workday is putting its guidance where its mouth is. The tech company is raising its outlook for subscription revenue for the entirety of fiscal 2022. It now believes this will rise by 19% year over year to between $4.5 billion and $4.51 billion (2021 result: just under $4.3 billion). It's also projecting a 21% adjusted operating margin for the year.