Workday to Lay Off 1,750 Employees as Part of Restructuring Plan

Workday (WDAY) announced in a regulatory filing Wednesday that it plans to lay off approximately 1,750 employees, or 8.5% of its workforce, as part of a restructuring plan.

The enterprise software company said the plan is intended to “continue advancing Workday’s ongoing focus on durable growth.”

In a memo to employees included in the filing, CEO Carl Eschenbach said “the difficult, but necessary, decision” was made as the company focuses on artificial intelligence (AI) investments.

“While we are eliminating some positions, we will continue to hire in key strategic areas and locations throughout FY26,” Eschenbach wrote. “We’re also prioritizing innovation investments like AI and platform development, and rigorously evaluating the ROI of others across the board.” 

Workday Anticipates $230M to $270M in Restructuring Charges

Workday expects “it will incur approximately $230 million to $270 million in charges in connection with the Plan, of which approximately $60 million to $70 million is expected to be recognized in the fourth quarter of fiscal 2025, and the remainder is expected to be recognized in the first quarter of fiscal 2026.” 

The company said it now expects fourth-quarter GAAP operating margin to be 22 to 23 percentage points lower than Q4 non-GAAP operating margin, and full-year GAAP operating margin to be 21 percentage points lower than its full-year non-GAAP operating margin.

Workday shares rose more than 4% in recent trading. They are down about 7% over the past 12 months.

UPDATE—This article has been updated with the latest share price and other information.