Monday.com Lowers 2026 Revenue Guidance
Project management software company Monday.com issued 2026 revenue guidance that was significantly below its previous outlook. The company also withdrew its long-term financial targets. The disclosure has triggered an investigation into the company for potential violations of federal securities laws.
- The revised 2026 revenue forecast is projected to be between $1.452 billion and $1.462 billion, falling short of the consensus revenue estimate of $1.48 billion. This represents a significant slowdown in growth to 18-19%, down from 27% in 2025. - In addition to lowering guidance, the company completely withdrew its long-term financial targets for 2027, citing macroeconomic uncertainty, the evolving AI landscape, and a shift in the business. - The law firm Levi & Korsinsky, LLP, has launched an investigation into whether Monday.com violated federal securities laws by failing to adequately disclose known headwinds before announcing the revised guidance. - Company executives attributed the lowered forecast to a "choppy" and deteriorating demand environment in its "no-touch" self-serve channels for smaller customers, which it no longer expects to rebound in 2026. - Negative foreign exchange pressure from the strengthening Israeli shekel is expected to create a 100-200 basis point drag on both operating and free cash flow margins. - Following the announcement, Monday.com's shares plummeted over 20%, hitting a 52-week low. Several analyst firms, including Baird and Loop Capital, downgraded the stock, while others like Canaccord Genuity significantly lowered their price targets. - The company is also increasing investments in AI products like "Sidekick" and "vibe," leading to higher research and development spending and a projected decline in gross margins. - Despite the negative outlook, the company highlighted strong performance in its enterprise segment, with customers paying over $50,000 in annual recurring revenue (ARR) now accounting for 41% of total ARR.
