Monday publishes a disappointing forecast, falling 15% in early trading

Stock monday which is in negative momentum due to the fear of AI harming its business, falls again in pre-trade on Nasdaq following disappointing forecasts it provided. The company, under the management of founders Eran Zinman and Roi Man, expects to register in the first quarter of 2026 revenues of $338-340 million, lower than analysts’ forecasts of approximately $343 million, with a non-GAAP operating profit of 37-39 million dollars.

Last week, Monday’s stock fell to a low of over 3 years and returned to trading below the price of $100, amid increasing market concerns that enterprise software companies will be harmed by new AI tools. Monday, which developed a kind of operating system for work designed to manage organizational tasks, was marked as one of the possible victims and is currently trading at a value of $5.1 billion, having lost 78% from its 2021 record and 36.8% from its IPO that year.

After the publication of the financial statements for 2025, the stock continued the negative momentum. Although the company posted good results in the fourth quarter and beat market forecasts, the outlook ahead disappoints investors. Munday expects to register in the first quarter of 2026 revenues of $338-340 million, lower than analysts’ forecasts of about $343 million, with a non-GAAP operating profit of $37-39 million. In 2026, the company expects growth of 18%-19% for revenues of 1.452-1.462 billion dollars, lower than analysts’ forecasts of 1.48 billion dollars, with an operating profit of 165-175 million dollars and an adjusted free flow of 275-290 million dollars.

In the fourth quarter, Monday grew by 25% to revenues of approximately $334 million, surpassing the forecasts it had previously given and those of the market. According to generally accepted accounting rules (GAAP) a net profit of $76.7 million was recorded, significantly higher than the corresponding quarter, and on a Non-GAAP basis a net profit of $55 million was recorded, which is $1.04 per share, 12 cents above analysts’ forecasts. The gap between GAAP and Non-GAAP profit is explained, among other things, by capital rewards for employees amounting to $39.5 million, and on the other hand a one-time tax benefit amounting to $61.2 million.

Record cash flow

In summary of the year 2025, Munday grew by 27% to revenues of approximately $1.23 billion, GAAP net profit of approximately $119 million and Non-GAAP net profit of approximately $234 million, which is $4.40 per share. The cash flow from current operations amounted to approximately $334 million in 2025, and at the end of the year Manday had over $1.66 billion in cash. A few months ago, Monday announced a plan to buy back its own shares, and of the approved amount, $870 million, it had another $735 million available for purchase at the end of the fourth quarter (it is possible that it has used some of it since then, due to the weakening of the stock).

A trend that continued throughout the year is Monday’s move to larger clients, and according to the company’s data at the end of the year, the number of paying clients with an ARR (annual recurring revenue) of over $100,000 increased by 45% to 1,756, and the number of clients with an ARR of over $500,000 increased by 74% to 87.

“We conclude another year of strong performance, with revenue growth of 27% and a Non-GAAP operating profit rate of 14%; along with the expansion of our product offering and a significant adoption rate of our AI products in 2025,” said Monday’s co-founders and CEOs, Roy Man and Eran Zinman. “At the same time, we continue to grow among large customers, who adopt more of our products and choose Monday for process management Their most significant work.”

“We presented strong financial results for 2025, with stable revenue growth and record non-GAAP operating profit and cash flow,” said Eliran Glazer, Monday’s CFO. “While fluctuations in exchange rates and the strengthening of the shekel against the dollar may affect margins in the short term, the business base remains healthy and we continue to see positive momentum with large customers.”