Welcome to the Cloud Wars Minute — your daily cloud news and commentary show. Each episode provides insights and perspectives around the “reimagination machine” that is the cloud.
In today’s Cloud Wars Minute, I discuss Workday’s strong fiscal Q4 performance, their growth prospects within the federal sector driven by DOGE initiatives, and how modernizing outdated government systems presents a significant opportunity for the company.
Highlights
00:15 — Workday recently posted a strong fiscal Q4, and as part of that, its CEO, Carl Eschenbach, made interesting comments about the DOGE program. Eschenbach said that he sees a tremendous opportunity spurred by the DOGE initiatives across the federal government.
00:56 — Subscription revenue for the quarter ended January 31 was up 15.9% to $2.04 billion. Its current RPO was up 15% to $7.63 billion. That’s within the next 12 months, and its total RPO was up 20% to more than $25 billion, so strong performance in Q4, and its guidance for the coming year, fiscal 2026, was also pretty strong.
01:56 — Eschenbach said, “We’ve had some big wins at a couple of government agencies,” and he said, riding that momentum, “We think that the federal government is in a situation now where, across the board, they’re spending a tremendous amount of money on technology already, but the problem is, those are on antiquated systems, and so much of the spending has to go to maintenance and integration and just upkeep.”
02:24— Eschenbach said he believes that with the DOGE effort underway, forcing greater efficiency within the organizations, the only way these agencies are going to be able to achieve that is they have to upgrade their systems. They’ve got to be in the process of getting ready to move to the cloud. And Eschenbach feels that Workday is in a great position to handle that.
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03:17 — Among the net new customer wins that Workday had, 30% bought both its HCM applications and its Financials. Eschenbach said, “More and more, as organizations are realizing how significant data is, they are moving to these consolidated suites where they can work off a single data model.” That is happening more and more with Workday’s big customers. So in the federal agencies, which are very large, Workday feels it’ll be able to step up and handle that.
04:24 — No doubt more of those innovations will come forward for the federal government, and that’s one of the reasons why Eschenbach believes that Workday has some good prospects there.
