Monday.com (NASDAQ:MNDY) shares plunged more than 13% Monday after the work-management platform issued a cautious revenue forecast for 2026, signaling a potential slowdown in the enterprise software sector despite a strong finish to the year.
The Tel Aviv-based company reported fourth-quarter revenue of $333.9 million, a 25% increase that beat the $329 million analyst consensus.
However, management’s projection for 2026 revenue of $1.45 billion to $1.46 billion fell short of Wall Street’s expectations, as foreign exchange volatility and a more measured pace of upmarket expansion weighed on the outlook.
The stock’s sharp decline reflects growing investor anxiety over whether traditional SaaS providers can maintain high growth rates as artificial intelligence reshapes the productivity landscape.
On an adjusted basis, Monday.com earned $1.04 per share, comfortably ahead of the $0.91 per share predicted by analysts.
The company also saw significant momentum in its enterprise tier, with the number of customers paying more than $50,000 annually surging 34% year-over-year to 4,281.
Furthermore, "monday vibe"—the company's latest product addition—became the fastest in its history to surpass $1 million in annual recurring revenue (ARR), reaching the milestone just 2.5 months after its October launch.
"We delivered another year of strong, disciplined execution," co-CEOs Roy Mann and Eran Zinman said in a joint statement, highlighting a 14% non-GAAP operating margin for the full year.
Despite the executive optimism, the company’s net dollar retention rate for its largest customers ticked down to 116%, compared to 117% earlier in the year.
As Monday.com shifts its focus to "AI agents" and a unified "Digital Workforce" strategy for 2026, it faces a steep climb to regain its premium valuation in a market increasingly skeptical of high-multiple software names.