Why Workday's Stock Jumped Over 5% After-Hours Today

Shares of Workday, Inc. (WDAY) surged 5.12% to $230.22 in Tuesday's after-hours trading, following a stake buildup by an activist investor in the AI-driven human resources software developer.

Elliott Investment Management said in a press release that it had built up a stake worth more than $2 billion in Workday, making it the fourth-largest institutional investor in the company. Vanguard Group, which holds about $5 billion worth of Workday shares, is currently its largest institutional investor, according to Koyfin.

Elliott acknowledged the efforts of CEO Carl Eschenbach, CFO Zane Rowe, and the entire Workday team for making "substantial progress" in recent years.

The activist investor also said it is pleased with its dialogue with Workday's management team. It lauded the company for the multi-year plan announced at the Financial Analyst Day held on Tuesday. This plan would drive substantial long-term value creation for the company's shareholders, it added. "We look forward to continued collaboration with the company."

In a response statement, Workday said, "We appreciate Elliott's support," but did not elaborate further.

Workday stock has fallen about 15% this year, underperforming the broader market, the tech sector, and the software industry. The company made a slew of announcements on Tuesday, coinciding with its analyst day, including a new collaboration with Microsoft to deliver unified AI agents to its customers via the software giant's Azure AI Foundry and Copilot Studio.

The company also announced "Workday Build," a developer platform that allows customers and partners to create, share, and scale AI-powered solutions directly on its platform. Separately, the company announced that it has agreed to acquire enterprise knowledge tools company Sana for $1.1 billion — its third AI-related deal in less than two months.

On Stocktwits, retail sentiment toward Workday stock improved to 'neutral' (47/100) by late Tuesday from 'bearish' a day ago. The message volume remained at 'extremely low' levels.

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