Enterprise software giant Workday is the latest Big Tech company to undergo massive job cuts as it focuses on deploying artificial intelligence.

On Wednesday, the HR tech firm terminated 1,750 employees or 8.5% of its workforce. HR and team leaders have purportedly begun meeting with affected employees.

The company said laid-off employees in the US will receive a minimum of 12 weeks’ pay, with additional compensation based on tenure. They will also receive accelerated vesting of restricted stock units, career transition support, benefits assistance, and immigration services.

For employees outside the US, severance packages will be structured in accordance with local regulations, with efforts to align them as closely as possible to US provisions.

In a staff memo, later shared on the Workday blog, CEO Carl Eschenbach explained that the layoffs were part of a larger decision of “investing strategically” and “bringing innovations to market faster”.

Also Read: Are layoffs really necessary when adopting AI?

Job cuts amid AI hiring plans

As job cuts are taking place, Workday is also preparing to hire in what it believes are high-impact areas of the business; among them, AI development.

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

Overall, the CEO believes: “The increasing demand for AI has the potential to drive a new era of growth for Workday. This creates a massive opportunity for us, but we need to make some changes to better align our resources with our customers’ evolving needs.”

After considering the size and scale of Workday – which employed more than 20,000 workers prior to the job cuts – the company was convinced current market conditions demanded a new approach.

Also Read: Microsoft layoffs: Were the job cuts handled poorly?

“We have to adapt by thinking differently, acting boldly, and investing strategically,” the CEO said, before outlining Workday’s priorities throughout financial year 2026.

“We’re evolving our processes to empower faster decision-making and to accelerate innovation,” he said.

“We’re ensuring everyone has a clear understanding of their contributions to our shared success. We’re investing in strategic locations with strong talent to better serve our customers worldwide.”

Eschenbach added: “In a couple of weeks, we’ll hold our company kickoff to go deeper into our updated strategic plans and key investment areas. This will be an important opportunity to connect and hear more about our vision for the future.”

More software companies shedding jobs

The trend of shedding jobs in the midst of a greater focus on AI continues to spread across the tech industry.

Salesforce, another enterprise tech company looking to expand its AI solutions, cut 1,000 jobs this week. Like Workday, the company said it will fast-track hiring in AI-focused roles, particularly in sales.

Security specialist Okta also announced layoffs. Some 180 employees, or 3% of its staff, have been let go as the company redirects its resources to driving growth.

The latest round of job cuts is Okta’s third in just three years as it faces tough competition from CyberArk.

Okta said it is allocating about US$11 million to cover employees’ severance packages and other benefits. The company promised to support laid-off workers.