Workday, Inc.

Ladies and gentlemen, welcome to Workday's first quarter fiscal year 27 earnings call. At this time, all participants are in a listen-only mode. We will conduct a question and answer session towards the end of the call. During Q&A, please limit your questions to one. I will now hand it over to Justin Furby, Vice President of Investor Relations. Please go ahead.

Thank you, Operator. Welcome to Workday's first quarter fiscal 2027 earnings conference call. On the call, we have Anil Bushri, our CEO, Garrett Katzmeier, our President, Product and Technology, Rob Enslin, our President and Chief Commercial Officer, and Zane Rowe, our CFO. Following prepared remarks, we will take questions. Our press release was issued after close of market and is posted on our website, where this call is being simultaneously webcast. Before we get started, we want to emphasize that some of our statements on this call, particularly our guidance, are based on the information we have as of today and include forward-looking statements regarding our financial results, applications, customer demand, operations, and other matters. These statements are subject to risks, uncertainties, and assumptions that could cause actual results to differ materially. Please refer to the press release and the risk factors in the documents we file with the Securities and Exchange Commission, including our fiscal 2026 annual report on Form 10-K for additional information on risks, uncertainties, and assumptions that may cause actual results to differ materially from those set forth in such statements. In addition, during today's call, we will discuss non-GAAP financial measures, which we believe are useful as supplemental measures of Workday's performance. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from GAAP results. You can find additional disclosure regarding these non-GAAP measures, including reconciliations with comparable GAAP results in our earnings press release in our investor presentation and on the investor relations page of our website. The webcast replay of this call will be available for the next 90 days on our company website under the investor relations link. Additionally, the prepared remarks of this call and our quarterly investor presentation will be posted on our investor relations website following this call. Our second quarter fiscal 2027 quiet period begins on July 15th, 2026. Unless otherwise stated, All financial comparisons in this call will be to our results for the comparable period of our fiscal 2026. With that, I'll hand the call over to Anil.

Thanks, Justin, and thanks to everyone for joining us today. It's great to be with all of you. I now have a full quarter under my belt since returning as CEO, and I truly feel the energy building at Workday every day, both throughout our path forward on AI and the company as a whole. We're in New York City this week for the SANA AI Summit, where we brought together some of the brightest minds in AI with our top customers. It's an incredible event, and it was great to see a few of you there. A few weeks ago, we hosted our top industry analysts at our annual innovation summit. Typically a skeptical group, they came away generally impressed by the pace of innovation and by our renewed focus on operating like a startup. One of them even called it the reinvention of Workday. Indeed, their reaction to our vision and execution around AI told me that we were absolutely on the right path. So do our Q1 results. We had a great first quarter. In fact, it was the best first quarter of new ACV growth in five years, anchored by the strength of our core business and the traction we're seeing with AI. Following slower ACV growth in fiscal year 26, we're seeing momentum once again building in the business. I'm confident in our ability to drive accelerated new ACV bookings this year as we bring new agents to market for our customers and drive even greater adoption. Last quarter, I mentioned I came back to help Workday lead again during the biggest technology transformation of our lives. After being back for three months, I have even more conviction that this is Workday's moment to lead. But to do it, we need to operate differently than we have been. In coming back, I was very focused on returning Workday to a startup orientation and a growth mindset. Indeed, I watched a lot of Steve Jobs' videos where he talked about his management approach when he returned as CEO. What struck me most wasn't about what Apple built after he returned, which was obviously incredible. It was more about his management philosophy. There was one interview in particular from All Things D where he called Apple the biggest startup in the world and said it was the startup mindset he brought back. Fewer layers, faster decisions, the best ideas winning, more ownership. We're trying to emulate that startup playbook. As a great philosopher Yogi Berra once said, And apropos that we were in New York City this week, it's like deja vu all over again. And so we're going back to our founding principles. I've said before, Chapter 4 is a re-founding moment for Workday. With AI, we're essentially a startup again. We're a startup sitting on one of the most important enterprise platforms ever built and the trust of more than 11,500 customers. We need to embrace that mindset. It's all about focus and trust, clear ownership, and the best ideas winning. That's how we're leading Workday now, and it's how Dave and I led the company early on. As part of this mindset, we've simplified our priorities to three. Number one, build and deliver the AI future. Number two, grow with our customers. And number three, live our values. We've also streamlined ownership across your organization so every workmate knows exactly how their work connects. Fewer things done with greater focus. A dedicated AI agent factory building agents across all of our application areas, clear ownership and accelerated development of our AI APIs. We've got the right people to do it. We have some incredible leaders from the companies we've acquired now in key roles at Workday. One of them is Joel Hellemark, the founder of Sana, who we named our chief AI officer just today. That's by design. These leaders know the startup mindset and they're helping Workday move faster and stay focused. I've also thought a lot about how Workday wins in this new chapter. I've met with dozens of customers since I've been back, and I keep hearing the same thing. Not one of them is looking to replace Workday with something they're building internally or from a startup. Instead, they were looking to us first for AI solutions for the HR and finance worlds, and hopefully IT in the future. It's really our opportunity for the taking, but we need to execute flawlessly and with speed. We have all the requisite components, one data model for all customers, one security model, and a true cloud architecture. Our business process framework gives AI the rails it needs to operate safely and accurately inside the enterprise. And over the past several years, we have completely rewritten our tech platform to be AI native in the way we manage transactions, reports, and the UI requests. That's basically the foundation we've spent 21 years building, and now it's been modernized for AI down to the core OMS. And we're delivering the results as well. Q1 was our first quarter with both Sana and Paradox fully integrated. With Sana, we're giving our customers a completely new Workday experience. It's a new front door to Workday that is simple and modern. The Sana platform is also the foundation for everything we're building in AI going forward. Joe and his team have created something remarkable and the integration has gone further and faster than I anticipated. We've already proven that customers trust Workday to deliver AI through agents we acquired. This is the year we proved that they also buy the agents we're building organically, agents that only Workday can build, and Garrett will share more on that momentum in a moment. While there are some who believe that AI can disrupt Workday, I see something different, our chance to once again be a disruptor with AI clearly driving that disruption. To that point, Garrett will talk about Sana for ITSM and the new travel agent we announced today at the summit. These are early examples of what it looks like when we use SANA to rapidly innovate on top of our data and context. What ties all this together is one simple truth. Customers don't want AI for AI's sake. They want AI that adds value to how they run their businesses. Our early adopter customers are already seeing that and they want more from Workday. To close, I am confident that Workday is ready for this AI moment. Our core business is strong, our AI strategy is working, and our execution is accelerating, starting with Q1. Seeing the agents Garrett is building and the success Rob is having selling and deploying them with customers, I couldn't be more confident in our path ahead and ability to lead. Garrett, over to you.