Workday cuts 375 jobs in second round of restructuring

Enterprise software company Workday has announced a new round of job cuts, eliminating 375 positions. This reduction represents approximately 2% of the company's global workforce and follows a larger round of layoffs in February 2025, when 1,750 employees were let go.

Second Round of Cuts

The latest announcement comes as part of a broader restructuring effort. Reports indicate the company is primarily targeting roles in customer support and its global customer operations organization, which it has described as less directly tied to revenue generation than sales or core engineering. The company has stated the move is intended to better align its people and resources with its highest priorities for fiscal 2027.

Workday has approximately 20,500 employees worldwide. The company's 18 U.S. offices could be affected, including locations in New York, Boston, and Washington.

AI Investment and Restructuring Costs

The company has been focusing on artificial intelligence and new products as its next growth engine. While the earlier round of layoffs in February 2025 was attributed to the company's growth in AI investments, the company did not cite artificial intelligence in the recent round of layoffs. The restructuring is part of a broader pattern in the enterprise software sector, where companies are reorganizing operations around AI capabilities while reducing headcount in functions susceptible to automation.

Workday has framed the move as part of a restructuring effort that will incur roughly $135 million in charges for severance, benefits, and related costs. The company has not detailed individual severance packages in available disclosures.

Industry Context

The job cuts come at a sensitive time for cloud software companies, as investors question whether years of easy growth can continue. The company is making a strategic bet that reallocating resources away from non-revenue generating roles and into product and AI will keep it competitive as software stocks wobble.

The risk is that the people who answer tickets and fix messy deployments are often the ones who keep enterprise customers from churning when budgets tighten. How Workday balances those competing pressures will say a lot about what the next phase of the tech cycle looks like for workers and customers alike.

This is not an isolated adjustment but a continuation of a pattern. Earlier restructuring already removed about 8% of the workforce, and the latest 2% reduction suggests leadership is still searching for the right balance between cost discipline and investment in future growth areas.

The cuts are part of a broader trend in the tech industry, where companies are increasingly citing AI-driven efficiency gains as a reason for workforce reductions. The company's leadership has referenced automation and efficiency gains in public statements, though the specific attribution of these latest cuts to AI-driven changes remains a matter of analysis rather than explicit company confirmation.

Sources

• Workday cuts hundreds of jobs as tech market suddenly stalls - NewsBreak
• Workday layoffs could affect staff in New York, Boston and Washington - NewsBreak