Workday stock jumped Friday, following second-quarter results that exceeded estimates on the top and bottom lines, as macroeconomic pressure proved to be lighter than expected.
Workday reported the results late Thursday.
The enterprise software company reported adjusted earnings of 83 cents a share on revenue of $1.54 billion. Analysts expected adjusted earnings of 79 cents a share on revenue of $1.52 billion.
Workday stock initially jumped 8.7% to 176.40, then pulled back. It closed at 166.46, up 2.5% on the stock market today.
Workday Stock: Managing A Tough Environment
"Management did an excellent job navigating a tough operating environment," Needham analyst Scott Berg wrote in a report to clients. "Macroeconomic pressures were less than feared.
Berg raised his price target on Workday stock to 220, from 200, and maintained a buy rating.
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"We continue to see a strong global demand for our products, underscoring how organizations are continuing to drive digital transformation across finance and HR to support the changing world of work," Workday Chief Executive Aneel Bhusri said in written remarks with the company's earnings release.
As a result, revenue grew 22% from the year-ago period. Subscription revenue was $1.37 billion, an increase of 23%.
"We delivered strong second-quarter results with healthy growth across the business, as enterprises of all sizes increasingly realize the need for a flexible, modern finance and HR solution to navigate their businesses and drive change during these uncertain times," Chief Financial Officer Barbara Larson said in her written remarks with the Workday stock release.
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