Workday U-turns on rehiring pledge as activist investors take $2B stake (www.theregister.com)

Activist investor Elliott Management has disclosed a roughly $2 billion stake in Workday just as the enterprise HR and finance SaaS vendor announced a $1.1 billion acquisition of Swedish AI firm Sana Labs, which builds "knowledge tools" (learning/knowledge-transfer AI). The move follows Workday’s February restructuring that cut about 8.5% of staff—roughly 1,750 roles—with the company initially saying those roles would be rehired over time. Workday has since hired senior product and engineering leaders from Google and UiPath (CTO Peter Bailis, Gerrit Kazmaier, and CCO Rob Enslin), but CEO Carl Eschenbach told investors this week that the company is consolidating and streamlining its operating model and may not restore the previously cut headcount. For the AI/ML community, Elliott’s backing signals investor approval of Workday’s pivot to AI-driven products and a tighter capital/operating model, but also raises the prospect of continued automation-led job reductions—echoing Elliott’s prior influence at Salesforce. Technically, the Sana Labs deal and new product leadership suggest Workday will accelerate embedding ML/agents for knowledge, training and automation across its HR and finance stack, prioritizing product and platform investment over rehiring. That implies larger-scale application of AI agents and knowledge-layer models to replace workflow and knowledge work rather than simply augment it, with downstream implications for enterprise labor demand, model integration, and product roadmap execution.