Feb 24 (Reuters) - Workday on Tuesday forecast fiscal 2027 subscription revenue below Wall Street estimates, signaling slower new client wins as corporations cut technology spending amid economic uncertainty.
Shares of the company fell 7% in extended trading.
Despite its push into AI, the enterprise software company faces headwinds from a challenging macroeconomic environment. Higher interest rates and economic uncertainty have prompted businesses to scrutinize big-ticket software investments and delay
purchasing decisions, weighing on new client wins.
Separately, Artificial intelligence lab Anthropic's release of a legal plug-in ignited an $830 billion global selloff in software and services stocks, including those of some of the startup's partners, as investors worried that AI-powered automation could undercut revenue streams at these companies.
Anthropic on Tuesday unveiled 10 new ways for business customers to plug in its technology to help with human resources-related tasks such as making new-hire materials reflect a brand's tone and policies, and investment banking tasks like reviewing deals.
Workday forecast annual subscription revenue between $9.93 billion and $9.95 billion, missing analyst expectations of $10 billion, according to data compiled by LSEG.
Total revenue for the quarter ended January 31 came in at $2.53 billion, compared with analysts' estimates of $2.52 billion.
Subscription revenue of the Pleasanton, California-based company came in at $2.36 billion in the fourth quarter, in line with expectations.
(Reporting by Juby Babu in Mexico City; Editing by Tasim Zahid)
