Workday lays off 500 employees in fresh cuts, product and tech teams hit hardest
Workday is laying off around 500 employees in its second round of job cuts this year, with the latest reductions affecting approximately 2.5 per cent of its workforce. The enterprise software company disclosed the cuts in a securities filing on September 29. The company said the layoffs will primarily affect its Product and Technology teams.
According to Workday, the latest job cuts are aimed at aligning team structures with its strategic growth priorities. “These actions include a reduction of approximately 2.5% of Workday’s current workforce, primarily within Workday’s Product and Technology team, and select leased office space reductions. Workday plans to continue to hire in key strategic areas and locations throughout its fiscal 2027,” the company said in the filing.
The latest layoffs follow an earlier round of job cuts at Workday in February, when the company reportedly eliminated around 400 roles. Workday has not directly linked either round of layoffs to artificial intelligence (AI), instead citing organisational changes and its growth priorities.
However, the cuts come at a time when AI is raising concerns about the future of the software-as-a-service (SaaS) industry. AI agents are becoming increasingly capable of handling multi-step tasks, writing code and interacting with software tools. This has fuelled concerns that businesses could use AI to build internal applications or automate workflows that they currently pay software companies to manage.
AI companies, including Anthropic and OpenAI, are developing tools that can carry out complex tasks with less human intervention. Anthropic’s Claude and OpenAI’s AI coding tools, for instance, can help developers write and modify code. While these tools do not replace all enterprise software, they are adding to questions about how traditional SaaS companies will compete as AI capabilities improve.
The uncertainty has also contributed to what the AI world calls the “SaaSpocalypse”, a sell-off that wiped hundreds of billions of dollars off the market value of software companies earlier this year.
As for the latest cuts, Workday’s Product and Technology teams, which are responsible for developing and maintaining its software products, will be hit hardest. However, the company has not disclosed how many employees from these teams will lose their jobs. Workday had 20,896 employees worldwide as of July 31, 2026. The latest job cuts could affect around 500 employees, according to Business Insider.
Meanwhile, Workday expects the restructuring to result in total charges of $65 million to $80 million, including severance costs, employee benefits and expenses related to reducing office space. The company expects most of these charges to be recorded in the third quarter of fiscal 2027, with the remaining amount recognised in the fourth quarter.- EndsAlso Read | Google brings Fitbit Air to India: Price, availability, features and everything to knowAlso Read | US govt to use AI to give passport within minutes, Marco Rubio demo makes people call him next Steve JobsAlso Read | What phone does Virat Kohli use? Now we know and it's a surprise
Divya enjoys making sense of the ever-evolving worlds of tech and AI. From decoding specifications and testing the latest gadgets to exploring how technology shapes the way we live, work and connect, she believes there is always more to a story than what meets the eye. Away from the screen, she is probably brewing her next cup of coffee, thinking about her next meal or overthinking just about everything else.
