Workday's stock fell 5.11% in pre-market trading on Friday, extending recent losses for the human-resources software provider.
The decline comes amid a broader selloff in software stocks as investors grow increasingly concerned about the threat artificial intelligence poses 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 software companies that sell to businesses can withstand competition from AI-powered rivals, with the selloff intensifying with each new announcement from AI developers.