Workday CEO: AI Impact on Software Overblown

Amid growing concerns about artificial intelligence (AI) disrupting software business models, Workday CEO Carl Eschenbach addressed these worries during an appearance on CNBC’s “Squawk Box” from the World Economic Forum in Davos, Switzerland. He asserted, “It’s an overblown narrative, and it’s not true,” rebuffing the notion that AI poses a risk to the company.

Eschenbach’s remarks come at a time when software stocks have experienced significant declines, largely attributed to fears that emerging AI tools will upend long-established business practices. In fact, Workday shares plummeted 17% in the previous year and have dropped another 15% since the onset of 2026. Additionally, in its recent third-quarter earnings report, Workday’s lackluster subscription revenue guidance sent ripples of concern among analysts and investors, exacerbating the company’s already precarious position.

Workday is not alone in this struggle, as major players like Adobe and Salesforce have seen their stock prices decline by 21% last year, while HubSpot faced an alarming plunge of over 40%. Recognizing the need to adapt, Eschenbach noted that businesses are increasingly turning to Workday for enhanced AI tools and the utilization of first-party data, which enables the company to maintain a competitive edge against third-party alternatives.

In response to the evolving market, many software companies, including Workday, have ramped up investment in AI capabilities to strengthen their offerings. Workday has made significant adjustments, including a reduction of approximately 1,750 jobs last year, aimed at reallocating resources toward AI initiatives. Moreover, ServiceNow recently signed a three-year partnership with OpenAI to bolster its own AI capabilities.

Eschenbach concluded by expressing confidence in Workday’s position in the evolving landscape, stating, “We are uniquely positioned to be one of the AI winners in the enterprise because of our incumbency, and lastly, because of the trust we get from our customers.” His optimistic perspective highlights the complexities of the AI narrative within the software industry, emphasizing the potential for growth rather than decline.