HR Tech Insights – Industry Update Q3 2025

September 29, 2025,

Insights

Key takeaways – What has been getting our attention in HR Tech

HCM is expanding into office of the CFO

The lines between traditional HR and finance functions are becoming increasingly intermingled. More strategic CFO involvement is driving a need for unified platforms to improve financial planning, workforce analytics and spend visibility to gain control over both financial and human capital.

The shift is visible in recent M&A with HCM vendors acquiring capabilities traditionally thought to reside within the office of the CFO.

Suite consolidation and renewed investor engagement

Suite consolidation is back— and investor interest has returned. As growth normalized in 2024, leading vendors rebuilt around capital-efficient operating models, and investors re-entered the market with selective M&A and structured financings.

With procurement fixated on total cost of ownership, standalone point solutions are losing ground to integrated HCM platforms that consolidate spend and data. Private equity, in particular, is leaning into “platform + tuck-in” plays to assemble broader suites.

Frontline-first HCM is accelerating

Tight labor markets and stricter compliance are pushing enterprises to standardize on enterprise-grade workforce management, with leaders like ADP and UKG expanding via acquisitions to handle complex, high-volume, multi-site operations.

On the employee-experience side, vendors are building for the deskless workforce: the LumApps–Beekeeper merger unites a modern intranet with a frontline comms and task app, creating an AI-powered employee hub that reaches every worker, in every location and shift.

AI is moving from assistants to domain agents

AI in HR tech is shifting from copilots to domain agents embedded across workflows—from recruiting and onboarding to workforce management and HR service—so actions happen natively where people work. Skills intelligence is the backbone, unifying hiring, internal mobility, and learning with recommendations and nudges that drive outcomes.

Workday’s acquisitions of Paradox and Sana underscore this shift, pairing a conversational hiring agent with AI-powered learning to create a native “front door” across the suite.

Download full report

To explore the full report – including M&A and fundraising activity and the public valuation environment in the HR Tech space – download the full report at the top of the page.