Workday’s Rally Tops Software ETF, but Buyout Talk Looms

Workday shares gained 64.1% in the three months through Sept. 22, far outpacing the 24.1% rise in the State Street SPDR S&P Software & Services ETF. But the sharp rebound has not erased the stock’s losses for the year.

Workday closed at $188.23 on Sept. 22, down 10.6% year to date, according to Barchart data. The XSW fund, which tracks software and services companies, was up 7.8% over the same period.

A major jolt came on Aug. 13, when Reuters reported that private-equity firm Silver Lake was in talks to acquire Workday. Shares rose nearly 18% that day. Reuters said discussions were ongoing, with no guarantee a deal would happen.

That jump complicates the comparison with the wider software sector. Workday’s three-month gain reflects both a rebound in software shares and investors’ response to reported takeover talks, rather than company performance alone.

Workday also reported solid results on Aug. 27. Fiscal second-quarter revenue rose 12.8% from a year earlier to $2.65 billion, while subscription revenue grew 13.9% to $2.47 billion.

The company’s remaining subscription revenue backlog, a measure of contracted business not yet recognized as revenue, reached $27.4 billion, up 8% year over year. Its 12-month subscription backlog rose 14.2% to $9.03 billion.

Even after the rally, Workday remained 23.2% below its 52-week high of $249.85, reached on Sept. 29, 2025. Investors will weigh recurring-revenue growth against the stock’s year-to-date decline, while watching for any concrete update on Silver Lake’s reported discussions.