Monday.com Cuts 620 Jobs Amid AI-Driven Restructuring and Market Challenges

Monday.com, a prominent Israeli software company listed on Nasdaq, announced it will lay off 620 employees, representing about 20% of its workforce. This decision follows a 50% drop in its stock price since the start of the year and a 74.7% decline over the past 12 months, reflecting broader investor concerns about the impact of artificial intelligence (AI) on the software industry. Monday.com develops a work management platform serving over 100,000 organizations worldwide, including major clients like Philips, McDonald's, and Uber.

The company stated that the organizational changes aim to align its structure with a new product vision centered on AI capabilities. Monday.com is flattening its management layers and creating smaller, more autonomous teams to accelerate decision-making and project ownership. The firm emphasized that these layoffs are not a short-term cost-cutting measure or a result of AI replacing employees but a strategic move to reallocate resources toward product development, AI engines, and future growth.

Additionally, Monday.com is revising its go-to-market strategy to focus on supporting existing customers transitioning to AI and attracting new clients adopting AI products from the outset. Founded in 2012 by Roy Man and Eran Zinman, Monday.com went public in June 2021 with a valuation of $6.8 billion and has expanded from project management to CRM, customer service, and development team management.

This restructuring follows the recent launch of Monday Ventures, the company’s $200 million investment arm dedicated to AI startups, with an initial $50 million deployment. CEO Roy Man highlighted that the company has shifted from a traditional work management platform to an AI agent-based platform where human workers and AI agents collaborate. The broader software-as-a-service (SaaS) market has faced increased investor skepticism amid rapid AI advancements, prompting reevaluation of traditional software business models and competitive advantages.