Startup Postmortems — 2026-09-30

This Week's Shutdowns

Workday Conducts Second Round of Layoffs in 2026 Workday is cutting approximately 2.5% of its workforce in what marks the software giant's second round of layoffs this year, according to a securities filing. The company joins dozens of SaaS firms caught in what industry observers are calling the "SaaSpocalypse," with enterprise software companies struggling to justify valuations after years of aggressive growth spending.

Biotech Workforce Reductions Continue Enanta Pharmaceuticals and Bristol Myers Squibb (BMS) are among biotech companies shedding staff, with BMS cutting 265 headquarters roles. The biotech sector has seen steady layoffs tracked by Fierce Biotech's fifth annual layoff tracker, reflecting broader pressures across life sciences R&D and commercial operations.

1 sources

i.insider.com

i.insider.com

Deep Dive Postmortem

Oracle's AI Admission: When Layoffs Meet Artificial Intelligence

Oracle's Securities and Exchange Commission filing marks a watershed moment for tech industry transparency. The database giant explicitly attributed 21,000 job cuts to AI investments, the first time a major technology company has made this connection in a legally binding document. The disclosure is significant because it removes plausible deniability from the AI-to-layoffs equation that analysts have long suspected but companies have avoided stating on the record.

The larger context is stark: Oracle borrowed $43 billion for AI data centers and used layoff savings to finance the expansion. This pattern suggests a structural shift in how mature tech firms are allocating capital—away from headcount and toward infrastructure. Rather than growth-driven hiring, cost-cutting enables AI infrastructure spending. The admission also validates concerns that AI implementation is fundamentally a substitution technology, replacing human labor rather than augmenting it.

Across the broader tech industry, layoffs have topped 225,000 workers in 2026 alone, with layoff trackers documenting 623 separate reduction events affecting over 190,000 people in just the first three quarters of the year.

Lessons Learned

1. Follow the Capital Flow
When a company announces major capex spending (especially in AI infrastructure), watch for subsequent layoffs. The two are increasingly linked. Founders should understand that "AI transformation" often means workforce transformation.

2. Layoffs as Strategy Signal
Oracle's admission shows that layoffs aren't always signs of distress—they can be deliberate capital reallocation. Mature companies are choosing infrastructure over headcount. Startups should note this won't match their own constraints: they typically can't borrow billions for data centers.

3. SaaS Sustainability Questions
Workday's second layoff round in one year suggests the SaaS scaling model—heavy sales, heavy burn—is hitting a ceiling. Companies that grew on venture capital assumptions about infinite runway are now facing efficiency demands. Founders building in crowded enterprise software categories should stress-test unit economics early.

4. Track Public Admissions
Oracle's SEC filing is a rare explicit statement. Most companies avoid naming AI in layoff disclosures. Founders and investors should read between the lines: if a competitor cuts staff while investing in AI/automation, that's a competitive signal worth heeding.