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PLEASANTON, Calif. - Workday, Inc. (NASDAQ:WDAY), a prominent player in the software industry with a market capitalization of $60.76 billion and strong revenue growth of approximately 15% over the last twelve months, announced Thursday it has entered into a definitive agreement to acquire Paradox, a conversational AI company specializing in candidate experience automation. According to InvestingPro data, Workday maintains robust financial health with more cash than debt on its balance sheet.
The acquisition aims to enhance Workday’s talent acquisition capabilities, particularly for high-volume frontline industries that employ nearly 3 billion workers globally. The transaction is expected to close in the third quarter of Workday’s fiscal year 2026, ending October 31, 2025, subject to regulatory approvals. With a healthy current ratio of 2.07, Workday demonstrates strong operational efficiency and financial stability to support such strategic investments.
Paradox’s AI-powered platform has facilitated over 189 million candidate conversations, helping companies achieve employee conversion rates exceeding 70% and reducing time-to-hire to as few as 3.5 days in some cases.
"By bringing Paradox’s candidate experience AI agent into Workday, we’re giving organizations a smarter, faster, and more engaging way to connect with candidates," said Gerrit Kazmaier, president of Product & Technology at Workday.
The integration will expand Workday’s recruitment capabilities across both frontline and office roles, combining Paradox’s conversational AI with Workday’s existing recruiting platform and HiredScore’s AI-driven talent matching.
Paradox CEO Adam Godson stated, "Workday’s global reach and comprehensive platform provide the perfect runway for us to accelerate our mission, bringing our proven conversational AI to a much bigger audience."
Chipotle, which already uses Paradox’s technology, reported reducing its time-to-hire by 75% and doubling applicant flow through the partnership.
Morgan Stanley is serving as financial advisor to Workday, while Qatalyst Partners is advising Paradox. Financial terms of the acquisition were not disclosed in the press release statement.
The acquisition represents Workday’s strategic move to strengthen its position in the high-volume hiring market while expanding its AI capabilities in talent acquisition. While trading at a relatively high P/E ratio of 123.8, InvestingPro analysis suggests the company is currently undervalued based on its Fair Value calculations. Investors seeking deeper insights can access comprehensive financial analysis and 10+ additional ProTips through InvestingPro’s detailed research reports, available for over 1,400 US stocks including Workday.
In other recent news, Workday has partnered with DailyPay to offer on-demand pay services in the United States and Canada, allowing employees to access their earned wages before regular paydays. This strategic partnership aims to alleviate financial stress for workers, particularly those in frontline and hourly positions. On the analyst front, JMP Securities has reiterated its Market Outperform rating for Workday with a price target of $315, highlighting the company’s strong performance and loyal client base. Meanwhile, BofA Securities has lowered its price target for Workday to $278 from $295, maintaining a Buy rating due to mixed deal activity and tempered expectations for Q2 growth. Oppenheimer has also maintained an Outperform rating with a $300 price target, expressing that expectations for Workday remain low but supported by valuation metrics. Additionally, Cantor Fitzgerald has initiated coverage with an Overweight rating and a $265 price target, showing confidence despite concerns about slowing growth and potential AI disruptions. These developments reflect a mixed but cautiously optimistic outlook from analysts on Workday’s future performance.
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