What changed in this filing

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Item 1. Financial Statements

2025-11-26 compared with 2025-08-22 · 181 added, 112 removed, 628 unchanged (32% of the section changed)

3 unchanged sentences

(in millions)

July 31, 2025 January 31, 2025

October 31, 2025 January 31, 2025

Current assets:

35 unchanged sentences

See Notes to Condensed Consolidated Financial Statements

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Workday, Inc.

1 unchanged sentence

(in millions, except number of shares which are reflected in thousands and per share data)

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

20 unchanged sentences

(1) Costs and expenses include share-based compensation expense as follows:

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

7 unchanged sentences

See Notes to Condensed Consolidated Financial Statements

Table o f Contents

Workday, Inc.

1 unchanged sentence

(in millions)

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

2 unchanged sentences

Net change in foreign currency translation adjustment 0 1 3 ( 2 )

Net change in unrealized gains (losses) on available-for-sale debt securities, net of tax provision (benefit) of $( 5 ), $ 10 , $ 5 , and $ 1 , respectively

( 16 ) 27 14 2

Net change in unrealized losses on cash flow hedges, net of tax provision (benefit) of $( 1 ), $( 1 ), $( 5 ), and $ 0 , respectively

Net change in unrealized gains on available-for-sale debt securities, net of tax provision of $ 2 , $ 2 , $ 7 , and $ 2 , respectively

Net change in unrealized losses on cash flow hedges, net of tax benefit of $( 1 ), $( 1 ), $( 6 ), and $ 0 , respectively

( 1 ) ( 9 ) ( 176 ) ( 10 )

2 unchanged sentences

See Notes to Condensed Consolidated Financial Statements

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Workday, Inc.

1 unchanged sentence

(in millions, except number of shares which are reflected in thousands)

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

23 unchanged sentences

Total stockholders’ equity $ 8,879 $ 8,624 $ 8,879 $ 8,624

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

4 unchanged sentences

Common stock repurchased ( 3,367 ) ( 649 ) ( 5,873 ) ( 2,538 )

Other share issuances 45 24 45 24

Balance, end of period 264,411 265,469 264,411 265,469

See Notes to Condensed Consolidated Financial Statements

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Workday, Inc.

1 unchanged sentence

(in millions)

Six Months Ended July 31,

Nine Months Ended October 31,

Cash flows from operating activities:

5 unchanged sentences

Non-cash lease expense 84 77

Losses on investments, net 2 10

Net (gains) losses on investments ( 24 ) 6

Accretion of discounts on marketable debt securities, net ( 52 ) ( 90 )

14 unchanged sentences

Business combinations, net of cash acquired ( 974 ) ( 824 )

Purchases of other intangible assets 0 ( 3 )

Purchases of non-marketable equity and other investments ( 17 ) ( 10 )

Sales of non-marketable equity and other investments 5 5

Net cash used in investing activities ( 510 ) ( 603 )

Net cash provided by (used in) investing activities 1,177 ( 1,054 )

Cash flows from financing activities:

4 unchanged sentences

Effect of exchange rate changes 1 0

Net decrease in cash, cash equivalents, and restricted cash ( 285 ) ( 375 )

Net increase (decrease) in cash, cash equivalents, and restricted cash 1,064 ( 701 )

Cash, cash equivalents, and restricted cash at the beginning of period 1,554 2,024

1 unchanged sentence

See Notes to Condensed Consolidated Financial Statements

Six Months Ended July 31,

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Nine Months Ended October 31,

Supplemental cash flow data:

4 unchanged sentences

Taxes related to net share settlement of equity awards, accrued but not paid

As of July 31,

As of October 31,

Reconciliation of cash, cash equivalents, and restricted cash as shown in the Condensed Consolidated Statements of Cash Flows:

3 unchanged sentences

See Notes to Condensed Consolidated Financial Statements

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Workday, Inc.

16 unchanged sentences

All such adjustments are of a normal, recurring nature.

The results of operations for the three and six months ended July 31, 2025, shown in this report are not necessarily indicative of the results to be expected for the full fiscal year ending January 31, 2026.

The results of operations for the three and nine months ended October 31, 2025, shown in this report are not necessarily indicative of the results to be expected for the full fiscal year ending January 31, 2026.

The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended January 31, 2025, filed with the SEC on March 11, 2025.

8 unchanged sentences

Although we offer a variety of enterprise cloud solutions to a diverse global customer base, we operate in one operating segment because our business activities are managed on a consolidated basis, our service offerings all operate on the Workday platform and are deployed in a similar manner, and our Chief Operating Decision Maker (“CODM”), who is our Chief Executive Officer, allocates resources and assesses performance based upon discrete financial information at the consolidated level.

Our CODM assesses performance and decides how to allocate resources based on Net income, as reported on the Consolidated Statements of Operations.

Our CODM assesses performance and decides how to allocate resources based on Net income, as reported on the Condensed Consolidated Statements of Operations.

Net income is used to evaluate the overall profitability of the business and to guide decisions on how to invest in and grow the business.

Our CODM also reviews Total assets, as reported on the Consolidated Balance Sheets, and Capital expenditures, as reported on the Consolidated Statements of Cash Flows.

Significant segment expenses include the costs and expenses presented on the Consolidated Statements of Operations.

Our CODM also reviews Total assets, as reported on the Condensed Consolidated Balance Sheets, and Capital expenditures, as reported on the Condensed Consolidated Statements of Cash Flows.

Significant segment expenses include the costs and expenses presented on the Condensed Consolidated Statements of Operations.

Other segment items include Other income, net and Provision for income taxes.

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Significant Accounting Policies and Accounting Standards

4 unchanged sentences

Our deposits exceed federally insured limits.

No customer individually accounted for more than 10% of trade and other receivables, net as of July 31, 2025, or January 31, 2025.

No customer individually accounted for more than 10% of total revenues during the three and six months ended July 31, 2025, or 2024.

Other than the United States, no country individually accounted for more than 10% of total revenues during the three and six months ended July 31, 2025, or 2024.

No customer individually accounted for more than 10% of trade and other receivables, net as of October 31, 2025, or January 31, 2025.

No customer individually accounted for more than 10% of total revenues during the three and nine months ended October 31, 2025, or 2024.

Other than the United States, no country individually accounted for more than 10% of total revenues during the three and nine months ended October 31, 2025, or 2024.

In order to reduce the risk of disruption of our cloud applications, we host our applications in data centers operated by third parties located in the United States, Europe, Canada, and the Asia-Pacific region.

14 unchanged sentences

The updated standard provides for adoption on a prospective basis.

We are currently evaluating the impacts of the updated standard.

We are currently evaluating the effect the updated standard will have on our financial statements and related disclosures.

In November 2024, the FASB issued ASU No.

4 unchanged sentences

We are currently evaluating the effect the updated standard will have on our financial statement disclosures.

In September 2025, the FASB issued ASU No.

2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40), Targeted Improvements to the Accounting for Internal-Use Software , which modernizes the internal-use software costs capitalization model by eliminating stage-based rules and replacing them with a principles-based framework to be more aligned with modern software development practices.

This ASU is effective for interim and annual reporting periods beginning in the first quarter of our fiscal 2029, with early adoption permitted as of the beginning of an annual reporting period.

Entities may adopt the guidance using prospective application, retrospective application, or a modified transition approach.

We are currently evaluating the effect the updated standard will have on our financial statements and related disclosures.

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Debt Securities

As of July 31, 2025, debt securities consisted of the following (in millions):

As of October 31, 2025, debt securities consisted of the following (in millions):

Amortized Cost Unrealized Gains Unrealized Losses Aggregate Fair Value

4 unchanged sentences

Asset-backed securities 156 2 0 158

Other debt securities

Supranational securities 27 0 0 27

Total debt securities $ 4,215 $ 40 $ 0 $ 4,255

8 unchanged sentences

Asset-backed securities 104 0 0 104

Other debt securities

Supranational securities 5 0 0 5

Total debt securities $ 6,638 $ 17 $ ( 4 ) $ 6,651

1 unchanged sentence

Included in Marketable securities $ 6,461 $ 17 $ ( 4 ) $ 6,474

The following table presents the fair values of debt securities as of July 31, 2025, by remaining contractual maturity (in millions).

The following table presents the fair values of debt securities as of October 31, 2025, by remaining contractual maturity (in millions).

Actual maturities may differ from contractual maturities because borrowers may have certain prepayment conditions.

7 unchanged sentences

Debt securities included in Marketable securities on the Condensed Consolidated Balance Sheets consist of securities with original maturities at the time of purchase greater than three months, and the remaining securities are included in Cash and cash equivalents.

Interest receivable of $ 62 million and $ 53 million was included in Prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets as of July 31, 2025, and January 31, 2025, respectively.

As of July 31, 2025, and January 31, 2025, unrealized losses on our debt securities were not material.

Interest receivable of $ 39 million and $ 53 million was included in Prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets as of October 31, 2025, and January 31, 2025, respectively.

As of October 31, 2025, and January 31, 2025, unrealized losses on our debt securities were not material.

We did not recognize any credit losses related to our debt securities during the periods presented.

We sold $ 265 million and $ 68 million of debt securities during the six months ended July 31, 2025, and 2024, respectively.

The realized gains and losses from the sales were not material for the periods presented.

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We sold $ 2.7 billion of debt securities during the nine months ended October 31, 2025, with a corresponding realized gain of $ 24 million.

We sold $ 115 million of debt securities during the nine months ended October 31, 2024, with an immaterial corresponding realized gain.

Equity Investments

Equity investments consisted of the following (in millions):

Condensed Consolidated Balance Sheets Location July 31, 2025 January 31, 2025

Condensed Consolidated Balance Sheets Location October 31, 2025 January 31, 2025

Money market funds Cash and cash equivalents $ 2,301 $ 988

5 unchanged sentences

The carrying values for our non-marketable equity investments are summarized below (in millions):

July 31, 2025 January 31, 2025

October 31, 2025 January 31, 2025

Total initial cost $ 205 $ 217

Cumulative net unrealized gains (losses) 28 27

Cumulative net unrealized gains

Carrying value $ 236 $ 244

We recognized net losses on non-marketable equity investments of $ 2 million and $ 3 million for the three months ended July 31, 2025, and 2024, respectively, and $ 3 million and $ 10 million for the six months ended July 31, 2025, and 2024, respectively.

During the three and nine months ended October 31, 2025, and 2024, there were no material gains or losses recorded on our non-marketable equity investments.

Fair Value Measurements

5 unchanged sentences

Level 3 — Unobservable inputs that are supported by little or no market activity.

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Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents information about our assets and liabilities that are measured at fair value on a recurring basis and their assigned levels within the valuation hierarchy as of July 31, 2025 (in millions):

Level 1 Level 2 Level 3 Total

4 unchanged sentences

Asset-backed securities 0 158 0 158

Other debt securities

Supranational securities 0 27 0 27

Money market funds 2,301 0 0 2,301

10 unchanged sentences

Asset-backed securities 0 104 0 104

Other debt securities

Supranational securities 0 5 0 5

Money market funds 988 0 0 988

11 unchanged sentences

Deferred Costs

Deferred costs, which consist of deferred sales commissions, were $ 840 million and $ 828 million as of July 31, 2025, and January 31, 2025, respectively.

Amortization expense for the deferred costs was $ 72 million and $ 62 million for the three months ended July 31, 2025, and 2024, respectively, and $ 140 million and $ 121 million for the six months ended July 31, 2025, and 2024, respectively.

Deferred costs, which consist of deferred sales commissions, were $ 859 million and $ 828 million as of October 31, 2025, and January 31, 2025, respectively.

Amortization expense for the deferred costs was $ 75 million and $ 64 million for the three months ended October 31, 2025, and 2024, respectively, and $ 215 million and $ 185 million for the nine months ended October 31, 2025, and 2024, respectively.

There was no impairment loss in relation to the costs capitalized for the periods presented.

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Property and Equipment, Net

Property and equipment, net consisted of the following (in millions):

July 31, 2025 January 31, 2025

October 31, 2025 January 31, 2025

Computers, equipment, and software $ 1,317 $ 1,370

6 unchanged sentences

Property and equipment, net $ 1,132 $ 1,239

Depreciation expense totaled $ 59 million and $ 58 million for the three months ended July 31, 2025, and 2024, respectively, and $ 121 million and $ 115 million for the six months ended July 31, 2025, and 2024, respectively.

Depreciation expense totaled $ 59 million and $ 60 million for the three months ended October 31, 2025, and 2024, respectively, and $ 180 million and $ 174 million for the nine months ended October 31, 2025, and 2024, respectively.

Business Combinations

Paradox Acquisition

In September 2025, we acquired all outstanding stock of Paradox, Inc.

(“Paradox”), a candidate experience agent that uses conversational AI to simplify the job application journey.

We have included the financial results of Paradox in our condensed consolidated financial statements from the date of acquisition.

The total acquisition-date fair value of the purchase consideration was $ 1.1 billion, attributable to cash consideration of $ 1.0 billion and the fair value of a previously held equity interest of $ 20 million.

The purchase consideration was preliminarily allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, with the excess recorded to goodwill.

The fair values of assets acquired and liabilities assumed may be subject to change over the measurement period as additional information is received and certain tax matters are finalized.

The measurement period will end no later than one year from the acquisition date.

The preliminary fair values of the assets acquired and liabilities assumed as of the date of acquisition were as follows (in millions):

Acquisition-related intangible assets

Other liabilities

Total purchase consideration, inclusive of previously held equity interest

The fair values and weighted-average useful lives of the acquired intangible assets by category were as follows (in millions, except years):

Estimated Fair Values

Weighted-Average Useful Lives (in Years)

Developed technology

Customer relationships

Total acquisition-related intangible assets

The goodwill recognized was primarily attributable to the assembled workforce and the expected synergies from integrating Paradox’s technology into our product portfolio.

The goodwill is not deductible for income tax purposes.

Separate operating results and pro forma results of operations for Paradox have not been presented as the effect of this acquisition was not material to our financial results.

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Other Acquisitions

In August 2025, we completed an acquisition for total purchase consideration of $ 6 million, resulting in an increase of $ 1 million and $ 4 million in acquired developed technology and goodwill, respectively.

Acquisition-Related Intangible Assets, Net

Acquisition-related intangible assets, net consisted of the following as of July 31, 2025 (in millions):

Acquisition-related intangible assets, net consisted of the following as of October 31, 2025 (in millions):

Gross Carrying Amount Accumulated Amortization Net Book Value

11 unchanged sentences

$ 864 $ ( 503 ) $ 361

Amortization expense related to acquisition-related intangible assets was $ 21 million and $ 20 million for the three months ended July 31, 2025, and 2024, respectively, and $ 42 million and $ 37 million for the six months ended July 31, 2025, and 2024, respectively.

As of July 31, 2025, our future estimated amortization expense related to acquisition-related intangible assets was as follows (in millions):

Amortization expense related to acquisition-related intangible assets was $ 25 million and $ 20 million for the three months ended October 31, 2025, and 2024, respectively, and $ 67 million and $ 58 million for the nine months ended October 31, 2025, and 2024, respectively.

As of October 31, 2025, our future estimated amortization expense related to acquisition-related intangible assets was as follows (in millions):

Fiscal Period:

2 unchanged sentences

Other assets consisted of the following (in millions):

July 31, 2025 January 31, 2025

October 31, 2025 January 31, 2025

Non-marketable equity and other investments $ 239 $ 247

Contract assets 54 44

Technology patents and other intangible assets, net 23 25

Prepayments for goods and services 31 16

Technology patents and other intangible assets, net 24 25

Deposits 13 10

1 unchanged sentence

Total other assets $ 433 $ 418

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Technology patents and other intangible assets with estimable useful lives are amortized on a straight-line basis.

As of July 31, 2025, our future estimated amortization expense was as follows (in millions):

As of October 31, 2025, our future estimated amortization expense was as follows (in millions):

Fiscal Period:

12 unchanged sentences

Gains or losses resulting from changes in the fair value of these hedges are recorded in Accumulated other comprehensive income (loss) (“AOCI”) on the Condensed Consolidated Balance Sheets and are subsequently reclassified to the same line item as the hedged transaction on the Condensed Consolidated Statements of Operations in the same period that the hedged transaction affects earnings.

As of July 31, 2025, we estimate that $ 6 million of net losses recorded in AOCI related to our cash flow hedges will be reclassified into earnings within the next 12 months.

As of July 31, 2025, and January 31, 2025, the notional values of the cash flow hedges that we held to buy U.S.

As of October 31, 2025, we estimate that $ 26 million of net losses recorded in AOCI related to our cash flow hedges will be reclassified into earnings within the next 12 months.

As of October 31, 2025, and January 31, 2025, the notional values of the cash flow hedges that we held to buy U.S.

dollars in exchange for other currencies were $ 3.0 billion and $ 2.8 billion, respectively, and the notional values of the cash flow hedges that we held to sell U.S.

6 unchanged sentences

Cash flows from the settlement of these forward contracts are classified as operating activities on the Condensed Consolidated Statements of Cash Flows.

As of July 31, 2025, and January 31, 2025, the notional values of the non-designated hedges that we held to buy U.S.

As of October 31, 2025, and January 31, 2025, the notional values of the non-designated hedges that we held to buy U.S.

dollars in exchange for other currencies were $ 229 million and $ 242 million, respectively, and the notional values of the non-designated hedges that we held to sell U.S.

dollars in exchange for other currencies were $ 535 million and $ 91 million, respectively.

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The fair values of outstanding derivative instruments were as follows (in millions):

Condensed Consolidated Balance Sheets Location July 31, 2025 January 31, 2025

Condensed Consolidated Balance Sheets Location October 31, 2025 January 31, 2025

Derivative assets:

10 unchanged sentences

The effect of cash flow hedges on the Condensed Consolidated Statements of Operations was as follows (in millions):

Three Months Ended July 31,

Three Months Ended October 31,

Condensed Consolidated Statements of Operations Location 2025 2024

2 unchanged sentences

Costs and expenses 2,173 5 1,995 3

Six Months Ended July 31,

Nine Months Ended October 31,

Condensed Consolidated Statements of Operations Location 2025 2024

4 unchanged sentences

Condensed Consolidated Statements of Operations and Statements of Comprehensive Income Locations

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

3 unchanged sentences

Gains (losses) associated with non-designated hedges were as follows (in millions):

Condensed Consolidated Statements of Operations Location Three Months Ended July 31, Six Months Ended July 31,

Condensed Consolidated Statements of Operations Location Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

1 unchanged sentence

$ 3 $ 0 $ ( 10 ) $ ( 2 )

We manage our exposure to counterparty risk by entering into foreign currency forward contracts with a diversified group of eight major financial institutions and by actively monitoring outstanding positions.

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We manage our exposure to counterparty risk by entering into foreign currency forward contracts with a diversified group of nine major financial institutions and by actively monitoring outstanding positions.

We are subject to netting agreements with all of these counterparties, under which we are permitted to net settle transactions of the same currency with a single net amount payable by one party to the other.

After consideration of these netting arrangements, the total net settlement amount related to our foreign currency forward contracts is an asset position of $ 1 million and a liability position of $ 92 million as of July 31, 2025, and an asset position of $ 86 million as of January 31, 2025.

After consideration of these netting arrangements, the total net settlement amount related to our foreign currency forward contracts is an asset position of $ 4 million and a liability position of $ 82 million as of October 31, 2025, and an asset position of $ 86 million as of January 31, 2025.

Although legally enforceable master netting arrangements exist between Workday and each counterparty, it is our policy to present the derivatives gross on the Condensed Consolidated Balance Sheets.

1 unchanged sentence

Outstanding debt consisted of the following (in millions):

July 31, 2025 January 31, 2025

October 31, 2025 January 31, 2025

2027 Notes $ 1,000 $ 1,000

4 unchanged sentences

Debt, noncurrent $ 2,986 $ 2,984

As of July 31, 2025, our future principal payments for the outstanding debt were as follows (in millions):

As of October 31, 2025, our future principal payments for the outstanding debt were as follows (in millions):

Fiscal Period:

8 unchanged sentences

The indenture governing the Senior Notes also includes covenants (including certain limited covenants restricting our ability to incur certain liens and enter into certain sale and leaseback transactions), events of default, and other customary provisions.

As of July 31, 2025, and January 31, 2025, we were in compliance with all covenants associated with the Senior Notes.

As of October 31, 2025, and January 31, 2025, we were in compliance with all covenants associated with the Senior Notes.

We incurred debt discount and issuance costs of approximately $ 27 million in connection with the Senior Notes offering, which were allocated on a pro rata basis to the 2027 Notes, 2029 Notes, and 2032 Notes.

1 unchanged sentence

The effective interest rates on the 2027 Notes, 2029 Notes, and 2032 Notes, which are calculated as the contractual interest rates adjusted for the debt discount and issuance costs, are 3.67 %, 3.82 %, and 3.90 %, respectively.

As of July 31, 2025, and January 31, 2025, the total estimated fair value of the Senior Notes was $ 2.9 billion and $ 2.8 billion, respectively.

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As of October 31, 2025, and January 31, 2025, the total estimated fair value of the Senior Notes was $ 2.9 billion and $ 2.8 billion, respectively.

The estimated fair values of the Senior Notes, which we have classified as Level 2 financial instruments, were determined based on quoted bid prices in an over-the-counter market on the last trading day of the reporting period.

1 unchanged sentence

In fiscal 2023, we entered into a credit agreement (“2022 Credit Agreement”) which provides for a revolving credit facility in an aggregate principal amount of $ 1.0 billion.

As of July 31, 2025, and January 31, 2025 we had no outstanding revolving loans under the 2022 Credit Agreement.

As of October 31, 2025, and January 31, 2025, we had no outstanding revolving loans under the 2022 Credit Agreement.

The revolving loans under the 2022 Credit Agreement may be borrowed, repaid, and reborrowed until April 6, 2027, at which time all amounts borrowed must be repaid.

4 unchanged sentences

The financial covenant, based on a quarterly financial test, requires that we do not exceed a maximum leverage ratio of 3.50 :1.00, subject to a step-up to 4.50 :1.00 at our election for a certain period following an acquisition.

As of July 31, 2025, and January 31, 2025, we were in compliance with all covenants included in the 2022 Credit Agreement.

As of October 31, 2025, and January 31, 2025, we were in compliance with all covenants included in the 2022 Credit Agreement.

Interest Expense on Debt

The following table sets forth total interest expense recognized related to our debt (in millions):

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

3 unchanged sentences

We have entered into operating lease agreements for our office space, data centers, and other property and equipment.

Operating lease right-of-use assets were $ 719 million and $ 336 million as of July 31, 2025, and January 31, 2025, respectively, and operating lease liabilities were $ 791 million and $ 378 million as of July 31, 2025, and January 31, 2025, respectively.

Operating lease right-of-use assets were $ 721 million and $ 336 million as of October 31, 2025, and January 31, 2025, respectively, and operating lease liabilities were $ 807 million and $ 378 million as of October 31, 2025, and January 31, 2025, respectively.

In July 2025, the 20 -year lease for our new European headquarters in Dublin, Ireland, commenced, following its execution in the first quarter of fiscal 2026.

This resulted in the recognition of an operating lease right-of-use asset of $ 313 million, and a corresponding operating lease liability of $ 333 million.

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The components of operating lease expense were as follows (in millions):

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

4 unchanged sentences

Supplemental cash flow information related to our operating leases was as follows (in millions):

Six Months Ended July 31,

Nine Months Ended October 31,

Cash paid for operating lease liabilities $ 97 $ 80

1 unchanged sentence

Other information related to our operating leases was as follows:

July 31, 2025 January 31, 2025

October 31, 2025 January 31, 2025

Weighted average remaining lease term (in years) 11 5

Weighted average discount rate 4.16 % 4.20 %

As of July 31, 2025, maturities of operating lease liabilities were as follows (in millions):

As of October 31, 2025, maturities of operating lease liabilities were as follows (in millions):

Fiscal Period:

4 unchanged sentences

Total operating lease liabilities $ 807

As of July 31, 2025, we had operating leases for office space and data centers that had not yet commenced with total undiscounted lease payments of $ 35 million.

These operating leases will commence in fiscal 2026, with lease terms ranging from approximately five to ten years .

As of October 31, 2025, we had operating leases for office space that had not yet commenced with total undiscounted lease payments of $ 36 million.

These operating leases will commence in fiscal 2026 and fiscal 2027, with lease terms ranging from approximately five to ten years .

Commitments and Contingencies

1 unchanged sentence

Our purchase obligations are primarily related to agreements for third-party hosted infrastructure platforms, data center equipment and software, business technology software and support, and sales and marketing activities.

During the six months ended July 31, 2025, there were no material changes outside the ordinary course of business to our non-cancelable purchase obligations disclosed in our Annual Report on Form 10-K for the fiscal year ended January 31, 2025.

During the nine months ended October 31, 2025, there were no material changes outside the ordinary course of business to our non-cancelable purchase obligations disclosed in our Annual Report on Form 10-K for the fiscal year ended January 31, 2025.

Legal Matters

2 unchanged sentences

These provisions are reviewed at least quarterly and adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular matter.

In our opinion, as of July 31, 2025, there was not at least a reasonable possibility that we had incurred a material loss, or a material loss in excess of a recorded accrual, with respect to such loss contingencies.

In our opinion, as of October 31, 2025, there was not at least a reasonable possibility that we had incurred a material loss, or a material loss in excess of a recorded accrual, with respect to such loss contingencies.

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Stockholders’ Equity

As of July 31, 2025, there were 217 million shares of Class A common stock, net of treasury stock, and 50 million shares of Class B common stock outstanding.

As of October 31, 2025, there were 214 million shares of Class A common stock, net of treasury stock, and 50 million shares of Class B common stock outstanding.

The rights of the holders of Class A common stock and Class B common stock are identical, except with respect to voting and conversion.

2 unchanged sentences

Share Repurchase Programs

In August 2024, our Board of Directors authorized the repurchase of up to $ 1.0 billion of our outstanding shares of Class A common stock (“August 2024 Share Repurchase Program”), and in May 2025, our Board of Directors authorized the repurchase of up to an additional $ 1.0 billion of our outstanding shares of Class A common stock (“May 2025 Share Repurchase Program”).

Under both programs, in accordance with applicable securities laws and other restrictions, we may repurchase shares of our Class A common stock through open market purchases, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Exchange Act, in privately negotiated transactions, or by other means.

We repurchase shares of our Class A common stock under share repurchase programs authorized by our Board of Directors.

Under these programs, in accordance with applicable securities laws and other restrictions, we may repurchase shares of our Class A common stock through open market purchases, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Exchange Act, in privately negotiated transactions, or by other means.

The timing and total amount of share repurchases will depend upon business, economic, and market conditions, corporate and regulatory requirements, prevailing stock prices, and other considerations.

Both programs have no expiration date, may be suspended or discontinued at any time, and do not obligate us to acquire any amount of Class A common stock.

Prior to the August 2024 and May 2025 Share Repurchase Programs, our Board of Directors authorized a $ 500 million share repurchase program in February 2024, which we completed in the third quarter of fiscal 2025, and a $ 500 million share repurchase program in November 2022, which we completed in the first quarter of fiscal 2025.

The table below sets forth information regarding our share repurchase programs (in millions, except number of shares which are reflected in thousands, and per share data):

Three Months Ended July 31, Six Months Ended July 31,

The share repurchase programs have no expiration date, may be suspended or discontinued at any time, and do not obligate us to acquire any amount of Class A common stock.

Share repurchase programs authorized by our Board of Directors that were in effect during the three and nine months ended October 31, 2025, and 2024, were as follows (in millions):

Authorization Date

Amount Authorized

Authorization Completion Date

November 2022

$ 500 Q1 fiscal 2025

February 2024

500 Q3 fiscal 2025

1,000 Q3 fiscal 2026

September 2025 4,000

The table below sets forth information regarding repurchase of shares under our share repurchase programs (in millions, except number of shares which are reflected in thousands, and per share data):

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

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Average price paid per share (1)

$ 238.40 $ 242.42 $ 237.42 $ 236.73

Amount repurchased (1)

$ 803 $ 157 $ 1,394 $ 600

(1) Amounts exclude excise tax and commissions.

All repurchases were made in open market transactions.

As of July 31, 2025, we were authorized to repurchase a remaining $ 1.2 billion of our outstanding shares of Class A common stock under our share repurchase programs.

As of October 31, 2025, we were authorized to repurchase a remaining $ 4.4 billion of our outstanding shares of Class A common stock under our share repurchase programs.

Employee Equity Plans

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Shares that are forfeited or withheld in connection with the net share settlement of restricted stock units (“RSUs”) are added to the reserves of the 2022 Plan.

As of July 31, 2025, 13 million shares of Class A common stock were available for future grants under the 2022 Plan.

As of October 31, 2025, 13 million shares of Class A common stock were available for future grants under the 2022 Plan.

In fiscal 2023, our stockholders approved the Amended and Restated 2012 Employee Stock Purchase Plan (“2012 ESPP”).

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Options to purchase shares are granted twice yearly on or about June 1 and December 1, and are exercisable on or about the succeeding November 30 and May 31, respectively.

As of July 31, 2025, 2 million shares of Class A common stock were available for issuance under the 2012 ESPP.

As of October 31, 2025, 2 million shares of Class A common stock were available for issuance under the 2012 ESPP.

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Restricted Stock Units and Performance-Based Restricted Stock Units

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RSUs generally vest over four years .

Activity during the six months ended July 31, 2025, was as follows (in thousands, except per share data):

Activity during the nine months ended October 31, 2025, was as follows (in thousands, except per share data):

Number of Shares Weighted-Average Grant Date Fair Value

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( 3,672 ) 224.06

Outstanding balance as of July 31, 2025 15,505 222.52

Outstanding balance as of October 31, 2025 14,732 223.24

(1) Includes approximately 42 thousand PSUs granted to executives in April 2025.

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(2) Includes shares withheld in connection with the net share settlement of RSUs.

As of July 31, 2025, there was a total of $ 2.9 billion in unrecognized compensation cost, adjusted for estimated forfeitures, related to unvested RSUs and PSUs, which is expected to be recognized over a weighted-average period of approximately three years .

As of October 31, 2025, there was a total of $ 2.7 billion in unrecognized compensation cost, adjusted for estimated forfeitures, related to unvested RSUs and PSUs, which is expected to be recognized over a weighted-average period of approximately three years .

Market-Based Restricted Stock Units

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However, the number of shares that ultimately vest can vary significantly with the achievement of the specified market criteria.

As of July 31, 2025, there was a total of $ 5 million in unrecognized compensation cost related to the PVU Award, which is expected to be recognized over approximately two years .

As of October 31, 2025, there was a total of $ 4 million in unrecognized compensation cost related to the PVU Award, which is expected to be recognized over approximately two years .

Contract Balances and Performance Obligations

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Condensed Consolidated Balance Sheets Location

July 31, 2025 January 31, 2025

October 31, 2025 January 31, 2025

Contract assets:

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$ 3,941 $ 4,547

(1) Included in this balance are amounts related to professional services that are subject to cancellation and pro-rated refund rights of $ 73 million and $ 83 million as of July 31, 2025, and January 31, 2025, respectively.

Revenues of $ 1.7 billion and $ 1.6 billion were recognized during the three months ended July 31, 2025, and 2024, respectively, that were included in the unearned revenue balances as of April 30, 2025, and 2024, respectively.

Revenues of $ 3.1 billion and $ 2.8 billion were recognized during the six months ended July 31, 2025, and 2024, respectively, that were included in the unearned revenue balances as of January 31, 2025, and 2024, respectively.

(1) Included in this balance are amounts related to professional services that are subject to cancellation and pro-rated refund rights of $ 79 million and $ 83 million as of October 31, 2025, and January 31, 2025, respectively.

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Revenues of $ 1.8 billion and $ 1.6 billion were recognized during the three months ended October 31, 2025, and 2024, respectively, that were included in the unearned revenue balances as of July 31, 2025, and 2024, respectively.

Revenues of $ 3.9 billion and $ 3.6 billion were recognized during the nine months ended October 31, 2025, and 2024, respectively, that were included in the unearned revenue balances as of January 31, 2025, and 2024, respectively.

Transaction Price Allocated to the Remaining Performance Obligations

As of July 31, 2025, approximately $ 25.4 billion of revenues are expected to be recognized from remaining performance obligations for subscription contracts.

As of October 31, 2025, approximately $ 26.0 billion of revenues are expected to be recognized from remaining performance obligations for subscription contracts.

We expect to recognize revenues on approximately $ 8.2 billion and $ 14.6 billion of these remaining performance obligations over the next 12 and 24 months, respectively, with the balance recognized thereafter.

Revenues from remaining performance obligations for professional services contracts as of July 31, 2025, were not material.

Revenues from remaining performance obligations for professional services contracts as of October 31, 2025, were not material.

Other Income, Net

Other income, net consisted of the following (in millions):

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

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For further information, see Note 11, Debt .

(2) Other primarily includes the net gains (losses) from our equity investments.

(2) Other primarily includes the realized gains (losses) from sales of debt securities and net gains (losses) from our equity investments.

For further information, see Note 3, Investments .

We reported an income tax provision of $ 111 million and $ 52 million for the six months ended July 31, 2025, and 2024, respectively.

The income tax provision for the six months ended July 31, 2025, was primarily attributable to earnings in the U.S.

We reported an income tax provision of $ 197 million and $ 86 million for the nine months ended October 31, 2025, and 2024, respectively.

The income tax provision for the nine months ended October 31, 2025, was primarily attributable to earnings in the U.S.

and profitable foreign jurisdictions.

The income tax provision for the six months ended July 31, 2024, was primarily attributable to earnings in the U.S.

and profitable foreign jurisdictions, offset by the excess tax benefit from share-based compensation.

The income tax provision for the nine months ended October 31, 2024, was primarily attributable to earnings in the U.S.

and profitable foreign jurisdictions, offset by the excess tax benefit from share-based compensation and increase in research and development credits.

We are subject to income tax audits in the U.S.

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The assessment requires significant judgment and is performed in each of the applicable jurisdictions.

As of July 31, 2025, we continue to maintain valuation allowances related to tax credits in certain state jurisdictions and net operating loss in certain foreign jurisdictions.

As of October 31, 2025, we continue to maintain valuation allowances related to tax credits in certain state jurisdictions and net operating loss in certain foreign jurisdictions.

We will continue to evaluate the need for valuation allowances for our deferred tax assets.

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The 2025 Tax Act did not have a material impact on our annual effective tax rate and is expected to reduce our domestic cash tax outflows for the remainder of fiscal 2026.

Due to the complexity and various upcoming effective dates of the 2025 Tax Act, we are still in the process of assessing its impact on our consolidated financial statements.

Due to the complexity and various upcoming effective dates of the 2025 Tax Act, we are still in the process of assessing its impact on our condensed consolidated financial statements.

The final impact may differ from our current estimates based on further analysis, regulatory guidance, and any legislative changes.

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We determine the dilutive effect of outstanding share-based awards using the treasury stock method.

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The net income per share is allocated based on the contractual participation rights of the Class A common shares and Class B common shares as if the income for the period had been distributed.

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The following table presents the calculation of basic and diluted net income per share (in millions, except number of shares, which are reflected in thousands, and per share data):

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

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The computation of diluted net income per share does not include the effect of the following potentially outstanding weighted-average shares of common stock because their effect would have been anti-dilutive (in thousands):

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

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3,487 258 1,305 2,217

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Geographic Information

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The following table sets forth revenues by geographic area (in millions):

Three Months Ended July 31, Six Months Ended July 31,

Three Months Ended October 31, Nine Months Ended October 31,

2025 2024 2025 2024

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Aggregate Property and equipment, net and Operating lease right-of-use assets by geographic area was as follows (in millions):

July 31, 2025 January 31, 2025

October 31, 2025 January 31, 2025

United States $ 1,161 $ 1,197

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The activities associated with this plan were substantially completed in the second quarter of fiscal 2026.

We incurred $ 232 million in charges in connection with this plan, of which $ 65 million was recognized in the fourth quarter of fiscal 2025, $ 166 million was recognized in the first quarter of fiscal 2026, and $ 1 million was recognized in the second quarter of fiscal 2026.

We incurred $ 237 million in charges in connection with this plan, of which $ 65 million was recognized in the fourth quarter of fiscal 2025, $ 166 million was recognized in the first quarter of fiscal 2026, and the remainder was recognized thereafter.

The total charges consisted of $ 198 million related to employee transition, severance payments, employee benefits, and share-based compensation, and $ 39 million related to an impairment of office space.

Fiscal 2026 Restructuring Plan activity was as follows (in millions):

Three Months Ended July 31, 2025 Six Months Ended July 31, 2025

Three Months Ended October 31, 2025 Nine Months Ended October 31, 2025

Workforce Reduction

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Restructuring liability, end of the period $ 5 $ 0 $ 5 $ 5 $ 0 $ 5

Additionally, we recorded exit charges of $ 1 million and $ 8 million associated with office space reductions under a separate restructuring plan during the three and six months ended July 31, 2024.

Subsequent Event

In August 2025, we entered into a definitive agreement to acquire Paradox, Inc., a candidate experience agent that uses conversational AI to simplify the job application journey, for approximately $ 1.0 billion in cash, subject to customary purchase price adjustments.

The acquisition is expected to close during the third quarter of fiscal 2026, subject to the satisfaction of closing conditions, including required regulatory approvals.

We recorded $ 9 million in exit charges associated with office space reductions under a separate restructuring plan during the nine months ended October 31, 2024.

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Subsequent Events

In November 2025, we completed our acquisition of Sana Labs AB (“Sana”), an AI company building the next generation of enterprise knowledge tools, for approximately $ 1.0 billion in cash.

The acquisition will be accounted for as a business combination and, accordingly, the purchase consideration will be allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date.

We are in the process of finalizing the preliminary purchase price allocation for the transaction and will provide the preliminary purchase price allocation within our Annual Report on Form 10-K for the fiscal year ending January 31, 2026.

In November 2025, we entered into a definitive agreement to acquire Pipedream, Inc.

(“Pipedream”), an integration platform for AI agents with pre-built connectors to common business applications.

The acquisition is expected to close during the fourth quarter of fiscal 2026, subject to the satisfaction of closing conditions.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements