monday.com cuts 20% of workforce in strategic pivot to AI Work Platform

monday.com Slashes 20% of Jobs to Double Down on AI - Monday.Com (NASDAQ:MNDY)

Following the announcement, the stock rose nearly 2%. monday.com To Cut 20% Of Workforce As It Restructures Around AI The Israel-based software company said the restructuring reflects ongoing changes to its product, marketing and go-to-market strategy. The plan is intended to create a leaner operating model while allowing the company to continue investing in AI-driven growth. Despite the workforce reduction, monday.com said it expects to keep hiring in key strategic areas through the remainder of 2026. Restructuring Charges And Timeline The company expects to incur net restructuring charges of approximately $45 million to $55 million. Those charges include $30 million to $35 million for severance, employee benefits and other related costs. They also include $30 million to $35 million for office space impairments. The charges will be partially offset by about $15 million in non-cash share-based compensation credits. Most of the charges are expected to be recognized in the second half of 2026, when the restructuring is also expected to be substantially completed. 2026 Outlook And Margin Guidance Alongside the restructuring announcement, monday.com reaffirmed its fiscal 2026 revenue growth forecast of 19% to 20%. The company also reaffirmed its adjusted free cash flow margin guidance of 19% to 20%. However, it increased its non-GAAP operating margin outlook to about 15% from approximately 13%. The company said it still expects full-year 2026 financial results to be in line with or above the guidance provided during its first-quarter earnings call. The updated non-GAAP operating margin and adjusted free cash flow margin guidance continue to reflect an estimated foreign exchange headwind of 100 to 200 basis points. The guidance also excludes any restructuring charges related to the plan. monday.com Price Action MNDY Price Action: monday.com shares were up 1.87% at $74.20 during premarket trading on Wednesday, according to Benzinga Pro data. Image via Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

Why is Monday.com stock climbing today? By Investing.com

Investing.com -- Monday.com stock rose 2.1% in pre-open trading as momentum from the company's sweeping restructuring announcement continued to carry the shares higher. The company disclosed plans to eliminate approximately 20% of its global workforce -- roughly 620 positions -- as it pivots away from its legacy work-management structure toward a model built around AI agents and human collaboration, while also raising its operating margin guidance. Management was explicit that the cuts were not driven by a desire to reduce costs or replace employees with AI, but rather to reorganize around smaller, autonomous teams capable of supporting the company's new AI Work Platform strategy. The company indicated it intends to reinvest the vast majority of the savings into product development, AI capabilities, and future growth, a message that resonated with investors who had been watching the stock trade near multi-year lows. The restructuring is expected to result in total charges of $45 million to $55 million, covering severance, benefits, and office space impairments. On the broader market front, the environment is modestly challenging today, with the S&P 500 slipping 0.2% and the Nasdaq declining 0.6%, making MNDY's pre-market gain a clear outperformance driven by company-specific news rather than macro tailwinds. Peers in the work-management and SaaS space, including Asana and HubSpot, have not reported comparable restructuring catalysts, underscoring that today's move is idiosyncratic to Monday.com's strategic repositioning. Taken together, the combination of a credible AI-pivot narrative, an improved margin outlook, and management's decisive action to restructure the organization has given investors a reason to revisit the stock, which remains well below its 52-week high of $296.94 and offers what some analysts view as a compelling risk-reward entry point ahead of the company's Q2 2026 earnings report on August 10. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.