In a securities filing on Wednesday, Workday revealed it will eliminate approximately 400 positions, representing roughly 2% of its global headcount of 20,400 as of January 31, 2025. The reductions will predominantly impact non–revenue-generating roles within its worldwide customer-service organization. The company stated the move is part of a broader effort to redirect resources toward its highest-priority initiatives. Despite the cuts, Workday plans to continue recruiting in targeted geographic markets and for strategic functions, including product engineering and sales, to support its long-term growth objectives.

Workday’s stock has declined about 34% over the past year, pressured by broader software sector volatility following the launch of competing AI tools and plugins. Investor sentiment has been dampened by concerns over the pace of AI integration and competitive threats in payroll and human capital management software. Additionally, Workday is facing a class-action lawsuit alleging discriminatory use of AI in hiring based on race, age and disability. The company has publicly denied these claims, labeling them unfounded. Together, the share price slide and potential legal liabilities underscore key risk factors investors will monitor as Workday executes its realignment strategy.