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2h ago

Elliott Takes $2 Billion Workday Stake as Company Lays Out Value Plan, $1.1 Billion Sana Deal

Fresh endorsement signals confidence in an AI-first pivot that pairs a $5 billion buyback with ambitious margin plus cash-flow targets.

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Overview

  • Workday unveiled a multiyear program featuring a $5 billion share repurchase, cost actions targeting roughly 1,000 basis points of GAAP margin expansion, and a $15 per-share free cash flow goal by fiscal 2028.
  • The company agreed to acquire Sana for about $1.1 billion after recent AI deals for Paradox and Flowise, expanding knowledge tools and workflow automation across its platform.
  • Elliott Investment Management disclosed a stake exceeding $2 billion and publicly backed management, and Guggenheim upgraded the stock to Buy with a $285 price target.
  • Fiscal Q2 FY26 results showed revenue of $2.35 billion up 12.6% year over year and EPS of $2.21 up 26%, with subscription backlog rising nearly 18% and AI product revenue more than doubling.
  • Shares climbed roughly 7% on Sept. 17 following the announcements, though the stock still trades at premium multiples near 7x sales and 26x free cash flow.