Workday handily topped second quarter earnings expectations Wednesday and delivered its fourth consecutive quarter of more than 40 percent growth in subscription revenue.
The software-as-a-service provider reported a net loss of $82.5 million, or 40 cents per share, compared to a net loss of $107 million, or 55 cents per share, a year earlier.
Non-GAAP earnings were 24 cents per share on revenue of $525.3 million, up 40.6 percent annually. Subscription revenue was $434.5 million, an increase of 42 percent from the same period last year.
Wall Street was expecting Q2 earnings of 15 cents per share on revenue of $507.4 million. Despite the earnings beat, Workday's share slipped slightly after hours.
Workday CEO and co-founder Aneel Bhusri said the company has seen strong adoption among medium enterprises and traction within its Workday Planning product.
"We continue to focus our investments on areas of the business that drive long-term growth, while delivering strong operating margins and cash flow expansion over time," added Workday CFO Robynne Sisco.
Looking ahead, Workday said it's raising fiscal 2018 outlook and now expects subscription revenue of $1.750 to $1.757 billion, or growth of 36 percent. Details were not yet available on the company's outlook for the current quarter or fiscal year. However, analysts are looking for Q3 earnings of 10 cents a share on revenue of $522 million.