By bringing cofounder Aneel Bhusri back to the CEO job, Workday has turned to a classic Silicon Valley tradition to deal with the AI threat squeezing software company stocks: the return of the founder.
Bhusri’s return to the top job at the human resources software company reflects the belief that only a founder with billions on the line and a personal legacy at stake has the unique vision and authority to steer the ship through difficult waters. And with majority voting control plus operational authority as CEO, Bhusri will have more power to make any difficult changes he sees necessary. A close look at Bhusri’s compensation package, however, suggests that it’s also an acknowledgement of just how bleak the investor prognosis is for software-as-a-service (SaaS) companies.
To lure Bhusri back to the CEO job he left two years ago, Workday is giving him a $138.8 million pay package comprising cash and performance-based and restricted stock. More than half the package, $75 million, only pays out if Bhusri can hit a series of undisclosed stock price targets over the next five years. Perhaps more telling is the other half: Roughly $60 million in restricted stock requires only that Bhusri stick around at Workday for the next four years, with no performance targets whatsoever.
With Wall Street bearish on SaaS companies, Workday is effectively recognizing the deep skepticism that even its founder-savior will face in successfully making the transition into the AI age.
The AI panic rippling through enterprise software stocks for the past couple of weeks has helped wipe out some $40 billion in value at Workday, slashing its market cap in half from an all-time high of $80 billion. The stock has fallen 51% to roughly $150 a share from an intraday peak of $311.28 less than two years ago. This year alone, the stock is down 29% amid the broad bloodbath subsuming the SaaS industry. Other SaaS companies, including Salesforce, ServiceNow, and HubSpot, have all suffered double-digit declines in their stock prices.
“AI is reshaping how work gets done and represents an even bigger transformation than the shift to cloud 20 years ago,” Bhusri wrote in a LinkedIn post the day after the news of the leadership change. “Just as we helped redefine enterprise software when we founded Workday, I believe we can once again lead the way in this AI era.”
There’s a lot at stake for Bhusri, even if he weren’t taking back the reins. As executive chair at the SaaS giant for the past two years, Bhusri has seen half the value of his more than 8-million-share ownership stake nose-dive from an all-time-high value of $2.6 billion in 2024, to about $1.3 billion. That’s a wealth wipeout on paper of roughly $1.3 billion in less than two years.
20 years of decision-making data and 68% voting control
Bhusri may have more hands-on experience leading a company than the average founder. Bhusri founded Workday with best friend and mentor Dave Duffield in 2005 before the two joined forces as co-CEOs in 2009. In the years since, Bhusri served as sole CEO after ceding the chairmanship to Duffield before sharing the role again in August 2020 with then co-CEO Luciano “Chano” Fernández. After Fernández announced his departure in December 2022, the board appointed ex–Sequoia Capital partner Carl Eschenbach to serve alongside Bhusri before Bhusri stepped into the executive chair role in February 2024. Now, with Eschenbach out as CEO, Bhusri is back in the saddle as CEO and chairman.
As the software company turns the page, it has 20 years of decision-making data and process history that offer the opportunity to provide enterprise-grade intelligence to large customers, Bhusri wrote in his post.
Workday’s success is highly dependent on Bhusri. The company operates with a dual-class share structure, which means shares sold on the open market, Class A shares, carry a single vote apiece, while Class B shares are worth 10 votes each. Between Duffield, Bhusri, and their affiliates and a voting rights agreement that dates back to Workday’s 2012 IPO, the two cofounders control 68% of the voting power through their Class B share ownership.
Bhusri’s LinkedIn post is jam-packed with optimism for Workday’s future, but the numbers are far more complex. In the past three years, the company has announced multiple rounds of layoffs impacting thousands of jobs with the rationale that they were part of a realignment, a shift toward AI, and a move to improve profitability. Last February, the company slashed its workforce by roughly 7.5% as part of a restructuring plan and recorded $172 million in associated charges.
While revenue is growing—Workday posted $8.4 billion in total revenue for fiscal 2025, up 16% over the year prior—that growth has slowed. Subscription revenue growth, for example,slowed from 19% in fiscal 2024 to 17% in fiscal 2025, per the company’s annual report, with the most recent quarter showing 15%. Plus, the unknown impact AI will have on SaaS companies casts a brutal shadow over the sector, and the impact on Workday is significantly visible. The day of Bhusri’s return, the stock dropped more than 6%, underscoring investors’ anxiety about the company and its challenges adapting to the AI age.
Workday has been mum on the specific targets Bhusri will have to hit to see his $138.8 million package pay out, but the disclosed terms state the $75 million award will be divided up into tranches that will require Bhusri to hit stock price targets—and stay at Workday. Bringing the price back up to its peak will mean more than doubling the stock price in the next five years. Bhusri’s $60 million restricted stock award will vest over four years so long as Bhusri stays with the company. He’ll also collect a $1.25 million salary and a yearly cash bonus of up to $2.5 million. He won’t be eligible for any more grants until 2027.
Eschenbach, the former CEO, who resigned from all his roles and will now serve as a senior advisor, received a severance package valued at roughly $3.6 million, and he’ll see accelerated vesting on nearly 140,000 shares of restricted stock units that would have vested in the year after his departure. At $150 a share, Eschenbach’s equity is worth more than $20 million, and he’ll see accelerated vesting on another 24,000 additional shares if performance metrics tied to the award are met. His “push-out score,” an independent assessment of the terms of his departure, ranked a nine out of 10. The score suggests “it seems extremely likely” Eschenbach felt pressured to leave.
In a post on LinkedIn, Eschenbach praised Bhusri and his former “Workmates” at Workday.
“The opportunity ahead of us is always greater than what’s behind,” wrote Eschenbach. “We are at a massive inflection point with AI, and there is nobody better than Aneel to lead Workday through this moment and drive the vision forward.”
Bhusri and Duffield’s agreement also means that if one of the cofounders is incapacitated or dies, the other gets control of both stakes. The dual-class structure is set to expire in October 2032—a year after Bhusri’s performance window closes in early 2031. That gives Bhusri a solid chunk of time to see if a cofounder in the CEO seat can have an impact on the stock price in the midst of an AI tidal wave.
