After the storm: Excellent results for Monday, so why are the shares falling?
Monday.com published its Q2 2026 report, showing 22% revenue growth and record operating profit. Despite these results, shares fell 9% due to the company's conservative annual forecast.
Eran Zinman and Roy Mann, founders of monday.com. Photo: Nathaniel Tobias
Monday.com published its quarterly report today (Monday) for the second quarter of 2026, and the numbers show strong growth and profitability. The encouraging data comes after a stormy period at the company, which included a widespread wave of layoffs as part of a reorganization, and a controversial request by the co-CEOs to upgrade their compensation terms (which they received). However, despite the figures, investors did not like the company's conservative forecast, and the company's shares are falling by 9% in pre-market trading on Wall Street.
Growth of 22 percent
Let's move on to the numbers. Monday's revenue in the second quarter of 2026 totaled 364.6 million dollars, reflecting growth of 22% compared to the same quarter last year, and the operating loss narrowed significantly to just 1.5 million dollars. At the same time, operating profit excluding various expenses reached a record 61.1 million dollars, while the adjusted free cash flow stood at 52.3 million dollars. CFO Eliran Glazer explained that the record level of operating profit is a result of tight financial discipline and a focus on the company's cost structure, or in plain language, efficiency and layoffs. For the layoff process, Monday allocated about 30-35 million dollars for severance pay and additional benefits for laid-off employees.
The central and most intriguing growth engine in the current report is undoubtedly the AI field. The annual revenue run rate from artificial intelligence products doubled compared to the first quarter, accounting for 17% of the total net revenue increase in the second quarter. The founders and co-CEOs, Roy Mann and Eran Zinman, noted that the decision to carry out an organizational change was aimed precisely at this goal — to concentrate all efforts on the AI-based work platform. The investment in developing new tools is proving itself not only in immediate revenue growth.
Another interesting figure is Monday's penetration into large organizations. The number of customers generating annual revenue of over 100 thousand dollars jumped by 37% and reached 2,019. Another impressive figure was recorded among customers bringing in over half a million dollars a year, where a jump of 68% was recorded. Today, customers generating over 50 thousand dollars account for 43% of total revenue, an increase from last year. The net revenue retention rate from existing customers remained strong at 109%, climbing to 115% in large organizations. In other words, contrary to the sentiment being voiced, at least for now, it does not appear that in large organizations AI tools or Vibe Coding are actually replacing Monday's products.
Following the momentum, Monday revised its annual forecast upwards with an expectation for revenue in the range of 1.466 to 1.474 billion dollars, representing annual growth of about 20%, but an amount about 10 million dollars lower than Wall Street analysts' expectations. Operating profit is expected to be about 230 to 234 million dollars. At the end of the quarter, the company also completed a share buyback (Buy Back) of 182 million dollars.
