Workday is laying off about two percent of its staff in a bid to align its people with its “highest priorities,” but at a significant cost to its margins for the quarter and the year, the company announced on Wednesday.

The SaaS-y HR vendor said most of the cuts will be to non-revenue generating roles in its Global Customer Operations team.

The Register sought more details and a company representative referred us to a [1]regulatory filing .

[2]

Workday warned costs associated with the layoffs will impact the margins it reveals in its next earnings announcement on Feb. 24.

[3]

[4]

During its last earnings call in November, Workday said it was executing well against its efficiency goals and expects quarterly GAAP operating margins to come in at 9.5 percent and fiscal year GAAP margins to arrive at eight percent.

Workday said it now expects GAAP operating margins to be 24 to 25 percentage points lower for the quarter and 22 to 23 percentage points lower for its full financial year.

[5]

“Workday estimates that it will incur approximately $135 million in charges … consisting of approximately $40 million of future cash expenditures related to severance payments, employee benefits, and related costs and approximately $15 million in non-cash charges for stock-based compensation,” according to the regulatory filing. “The charges also consist of approximately $80 million in non-cash charges related to the impairment of certain office space and long-lived assets.”

[6]Workday project at Washington University hits $266M

[7]Workday confronts existential threat as customers freeze hiring

[8]Salesforce opts for seat-based AI licensing as customers demand predictability

[9]Microsoft warns of 'payroll pirate' crew looting US university salaries

As of January 2025, Workday’s global workforce consisted of over 20,400 employees in 34 countries, of which approximately 63 percent were located in the U.S.

Last February, Workday announced plans to cut eight percent of its workforce – around 1,600 jobs. The layoffs announced yesterday could hit about 400 jobs. ®

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[6] https://www.theregister.com/2025/12/12/washington_university_workday_costs_revealed/

[7] https://www.theregister.com/2025/11/26/workday_cross_selling/

[8] https://www.theregister.com/2025/12/12/ai_agents_salesforce_pricing/

[9] https://www.theregister.com/2025/10/10/microsoft_payroll_pirate/

[10] https://whitepapers.theregister.com/