Workday cuts 1,750 jobs, representing roughly 8.5% of its total workforce.

NEW YORK — Workday has announced it will reduce its workforce by approximately 1,750 positions, representing 8.5% of its total employees.

According to a memo sent to staff by CEO Carl Eschenbach, which was also disclosed in a securities filing, the decision to implement layoffs is pivotal to the company’s ambition to enhance its growth strategies, specifically emphasizing investments in artificial intelligence.

In his message, Eschenbach stated, “As we begin our new fiscal year, we find ourselves at a crucial juncture. Organizations globally are rethinking operational methodologies, and the rising demand for AI has the potential to usher in a new growth chapter for Workday.”

Workday intends to inform the majority of those affected by the layoffs on Wednesday itself. Eschenbach expressed empathy regarding the challenging news, suggesting employees either work remotely or take the day off.

The company, well-known for its human resources software solutions, has also signaled its plan to vacate some office spaces but did not provide specific details about the timeline or locations involved. His memo indicates that the restructuring aims to broaden Workday’s global presence through investments in strategic areas.

Despite the job cuts, Workday is still looking to expand its workforce in certain areas and roles over the next year.

Workday has projected that the restructuring will result in costs ranging from $230 million to $270 million, largely due to severance packages, employee benefits, and other associated expenses. All affected U.S. employees can expect a minimum of 12 weeks of severance pay, with additional payments based on their duration of service. Eschenbach mentioned that workers in other countries would receive termination packages as per local regulations.

The job reductions at Workday coincide with ongoing layoffs within the technology sector, which have impacted prominent companies such as Intel, Cisco, and Apple in the past year amid a wave of industry consolidation. Many businesses are reshaping their structures in response to the need to stay competitive in the face of changing consumer spending habits while simultaneously investing more heavily in artificial intelligence capabilities.

Workday is scheduled to release its earnings report for the entire 2025 fiscal year later this month. In its third quarter, the California-based firm recorded a net income of $193 million alongside revenue of $2.16 billion, compared to a net income of $132 million and revenue of $2.09 billion from the previous year.

By midday trading on Wednesday, Workday’s stock had increased by over 2.5%.