Monday.com Ltd (NASDAQ: MNDY) tanked another 20% on Monday morning despite the “Work OS” provider posting better-than-expected financials for its fiscal Q4.
MNDY earned $1.04 a share in its fourth quarter on $333.9 million in revenue, but the celebration was short-lived as its cautious 2026 guidance for up to $1.462 billion in revenue spooked investors.
Analysts, in comparison, had called for $1.48 billion in revenue this year.
Today’s sell-off marks the third consecutive quarter that Monday.com stock has tumbled following an earnings print, leaving it down some 50% versus its year-to-date high.
AI fears are weighing on Monday.com stock
MNDY shares are gasping for gains as investors question the firm’s “long-term growth trajectory” in an increasingly automated world.
Over the past year, the narrative surrounding Monday.com has shifted from “growth darling” to “vulnerable incumbent.” Why? Mostly because of AI disruption fears.
Investors are concerned that conventional Software-as-a-Service (SaaS) platforms, which rely on human-heavy data entry and manual project tracking, are being rendered obsolete.
After all, why pay for a colorful board of columns when an LLM can coordinate tasks, generate code, and manage schedules autonomously?
Markets are, therefore, worried that artificial intelligence will replace the need for the Monday.com interface entirely.
As AI agents begin to handle end-to-end workflows, the value proposition of a centralized manual dashboard is being challenged, leading to a rotation of capital away from classic SaaS and toward AI-native infrastructure.
How Monday.com is tackling these AI fears
During the earnings call, management worked overtime to convince the Street that they aren’t just watching the AI revolution from the sidelines – they are actively participating in it.
Monday.com co-founder Eran Zinman emphasised that the company is re-architecting its platform to be “AI native”.
To combat stagnation, the Nasdaq-listed firm highlighted new capabilities like AI Agents and the “Monday Vibe” feature.
Vibe, which allows users to build custom applications on top of their data, has already become the fastest product in company history to hit $1 million in ARR.
“We don’t see any impact currently from any AI company,” Zinman said, noting the company has even pivoted its homepage and advertising messaging to focus almost exclusively on AI-driven efficiency to improve conversion and user engagement.
Still, Monday.com shares have lost more than 75% in the trailing 12 months.
Does that make MNDY shares worth owning?
While management’s commitment to AI is clear, the real question is whether these “fixes” are enough to stop the bleeding.
The bull case suggests that by integrating agents and “Sidekick” (their intelligence layer), MNDY transforms from a passive tool into an active participant that executes work.
If they can successfully monetise these features through their new AI credit model, it could drive a second act of hyper-growth.
However, the bear case – which currently has the upper hand – argues that these features are reactionary.
Despite the flashy “Vibe” launch, the company’s Net Dollar Retention (NDR) has slipped to 110%, suggesting that existing customers aren’t expanding their usage as rapidly as before.
If AI truly makes work “self-managing,” the seat-based pricing model that built Monday.com’s empire is under direct threat.
All in all, until management can prove that AI leads to more seats rather than fewer, MNDY shares may continue to struggle against the tide of automation.
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