International expansion is another priority for Workday, which plans to seize the growing demand for cloud-based HR solutions outside the United States. DeStefano noted that the company is taking a three-pronged approach to ensure financial stability: “cost reductions, market expansion overseas, and investing in tools designed to enhance decision-making and improve efficiency. This is particularly relevant given the increasing competition within the market, increased consolidation through firm acquisitions, and the potential for slower demand due to higher interest rates.”

While specific regional targets weren’t disclosed, DeStefano observed that the company’s strategy suggests a careful realignment of resources. “Based on their statements, they have decided to close certain locations while opening new ones. This suggests that the geographical reorganization is designed to restructure their regional footprint to keep pace with evolving consumer demand across their markets,” he said. “Additionally, while the company is laying off employees, they are not enacting a hiring freeze. Instead, they have stated that they will add workers to critical locations and roles within the company, along with making AI investments, to maintain and enhance its applications for consumers throughout the transition and in the long run.”

Workday faces intense competition in HR software from both established firms and startups, according to Janice Quek, an analyst at investment research firm CFRA.