Workday (WDAY) - Get Workday, Inc. Class A Report fell sharply Tuesday after confirming that Amazon (AMZN) - Get Amazon.com, Inc. Report dropped a three-year plan to utilize the business software company’s human resources offering.
The news originally was reported by Business Insider, which cited sources.
The report said Workday’s software wasn't robust enough to fulfill Amazon’s expanding needs.
Workday stock recently traded at $223, down 7%, leaving it down 0.3% over the past six months. Amazon recently traded at $3,614, down 2%. It has gained 9% over the past six months, held down by concern over its valuation.
Workday’s relationship with Amazon began in 2016, when Amazon agreed to use Workday Human Capital Management, Seeking Alpha reported.
Workday offered the following explanation of the most recent development in a blog, claiming the Amazon decision was actually made more than a year ago:
"More than a year and a half ago, both Workday and Amazon mutually agreed to discontinue Amazon’s Workday Human Capital Management deployment, with the potential to revisit it in the future.
"This was not related to the scalability of the Workday system, as we currently support some of the world’s largest organizations, including more than 45% of the Fortune 500 and more than 70% of the top 50 Fortune 500 companies. ...
"Our relationship with Amazon remains strong with the Amazon Web Services partnership intact and other Amazon subsidiaries — such as Audible, Twitch, and Whole Foods — successfully using our system.
"The decision to discontinue the deployment more than 18 months ago has no impact on our previously communicated financial guidance provided on May 26, 2021."