Workday's stock plummeted 6.19% during intraday trading on Friday, continuing a significant downtrend for the human-resources software provider.
The sharp decline is part of a broader selloff affecting the software sector, driven by growing investor concerns that artificial intelligence poses a serious threat to traditional software companies. The sector has lost $1.6 trillion in market capitalization this year, with Workday already posting a 38% decline year-to-date.
Investors are questioning whether established software companies can withstand competition from AI-powered rivals, with the selloff intensifying with each new announcement from AI developers. This marks a reversal for an industry that was previously a Wall Street darling due to its subscription-based revenue models and strong profit margins.