Workday, Inc. stock research
FY2025 Q3
Workday (WDAY) Gross Margin — Quarter Ended Oct 31, 2025
Revenue and gross profit both increased relative to the prior quarter and the same quarter last year. Cost of revenue rose in both comparisons, yet gross margin improved sequentially while declining slightly versus the year-ago period.
Gross margin takeaway
Quarter ended Oct 31, 2025 · FY2025 Q3
Revenue and gross profit both increased relative to the prior quarter and the same quarter last year. Cost of revenue rose in both comparisons, yet gross margin improved sequentially while declining slightly versus the year-ago period.
- Gross margin strengthened sequentially as revenue grew faster than cost of revenue, indicating improved cost leverage. Compared to the year-ago quarter, margin weakened slightly, suggesting cost growth outpaced revenue expansion.
- Quarter-over-quarter, revenue and gross profit were higher, cost of revenue was slightly higher, and gross margin improved. Year-over-year, revenue and gross profit were notably higher, cost of revenue was higher, and gross margin was marginally lower.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
76.7%
Gross profit
$1.9B
Revenue
$2.4B
Cost of revenue
$566.0M
Quarter-over-quarter change
+0.6 pts
Year-over-year change
-0.3 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Jan 31, 2025 | $2.2B | $1.7B | $539.0M | 75.6% |
| Apr 30, 2025 | $2.2B | $1.7B | $516.0M | 77.0% |
| Jul 31, 2025 | $2.3B | $1.8B | $561.0M | 76.1% |
| Oct 31, 2025 | $2.4B | $1.9B | $566.0M | 76.7% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jul 31, 2025
+0.6 pts
Year-over-year change
Oct 31, 2023
-0.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
Gross margin strengthened sequentially as revenue grew faster than cost of revenue, indicating improved cost leverage. Compared to the year-ago quarter, margin weakened slightly, suggesting cost growth outpaced revenue expansion.
Quarter-over-quarter, revenue and gross profit were higher, cost of revenue was slightly higher, and gross margin improved. Year-over-year, revenue and gross profit were notably higher, cost of revenue was higher, and gross margin was marginally lower.
Monitor the trajectory of cost of revenue relative to revenue growth, as the year-over-year margin decline suggests costs are rising at a faster pace.