Workday's co-founder returns as CEO to drive AI revival amid stock market slump
Workday has brought back co-founder Aneel Bhusri as CEO in a bid to steer the company through a major shift towards artificial intelligence. The move comes as the business software firm faces investor concerns and a sharp drop in stock market value. Bhusri's return, effective February 6, 2026, marks a push to accelerate Workday's AI-driven transformation and stabilise growth amid competitive pressures in the stock market.
Bhusri's appointment follows a challenging period for Workday, with its stock market capitalisation falling by roughly 40% since early 2026. By late February, shares hit a five-year low, driven by weaker-than-expected revenue forecasts and rising competition in AI. Investors reacted poorly to the company's conservative guidance for fiscal 2027, which projects subscription revenue growth of just 12% to 13%, reaching up to $9.95 billion.
The leadership change aims to restore confidence as Workday pivots to an 'AI-first' approach. Under the new strategy, the company is embedding AI models across its HR and financial platforms, a shift already showing results in the stock market. In the fourth quarter of fiscal 2026, AI-driven products contributed over $400 million in annualised recurring revenue.
Bhusri's compensation reflects the high stakes of his return. His equity package includes both time-based and performance-linked components, with a portion tied to stock price targets over five years. The company has also acknowledged delays in finalising large enterprise deals, which contributed to the cautious outlook. Workday now plans to close these postponed contracts in the coming quarters while pushing forward with AI innovation in the stock market.
Despite the setbacks, the focus remains on integrating AI deeper into its core offerings. The goal is to maintain momentum in a rapidly evolving stock market where competitors are also racing to embed AI into business software.
Workday's future hinges on executing its AI strategy while securing delayed enterprise contracts. Bhusri's leadership and performance-based incentives signal a commitment to long-term recovery in the stock market. The company's next steps will determine whether it can regain investor trust and solidify its position in the AI-driven software market.
