Workday surged as much as 10 percent in extended trading on Thursday after the provider of cloud-based human resources software reported quarterly results that topped analysts’ estimates.
Total sales in the fiscal third quarter jumped 34 percent, spurred by a 35 percent increase in subscription revenue to $624.4 million. The company also raised its forecast for the fourth quarter.
Like other subscription software companies, Workday is benefiting from businesses moving their most critical software and applications to the cloud. For Workday, that mostly revolves around HR and financial management products.
Workday shares have jumped 43 percent this year as of Thursday’s close, and climbed another $13.70 to $159 after the earnings report.
The company’s numbers come two days after a similarly upbeat report from cloud software peer Salesforce. Both stocks are rallying this week along with other software companies after a recent sell-off in technology shares .
“We extended our market leadership in HCM, welcoming more Fortune 500 customers to the Workday community, and accelerated adoption of Workday Financial Management as more finance organizations move to the cloud,” CEO Aneel Bhusri said in a statement.
For the fourth quarter, Workday said it expects subscription revenue to grow 33 percent to $2.38 billion.