The big picture: Workday's Q2 FY2027 results exceeded expectations, driven by new payroll partnerships and an expanded AI-driven platform for U.S. and India payroll workflows.

Why it matters: This signals a growing reliance on AI in HR technology, impacting how companies manage payroll and potentially influencing future staffing and talent acquisition strategies.

Between the lines:

• Workday's stock saw a 69.1% 90-day return, despite a 20.34% one-year decline.
• Valuation narratives suggest Workday could be 65% undervalued, with a fair value around $550 per share.
• The company's P/E ratio of 37.1x is above the US Software industry average of 30.4x.

Staffing & HR impact: Increased AI adoption in payroll could streamline HR operations, reducing manual tasks and potentially shifting demand for certain HR administrative roles. Staffing firms may need to adapt by offering talent skilled in AI-powered HR systems.

The bottom line: Workday's performance highlights the accelerating integration of AI into core HR functions, a trend that will continue to reshape the HR tech landscape.