Monday.com Q3 Earnings Show Strong Profit, Guidance Slows
monday.com Q3 earnings showed record non-GAAP margins and stronger EPS but trimmed near-term growth, potentially pressuring shares and options activity.
KEY TAKEAWAYS
- Revenue was $378 million, up 19.0% year over year.
- Non-GAAP operating margin hit a record 24.0% and non-GAAP EPS was $2.14.
- Fourth-quarter revenue guidance of $380 million-$382 million implies about 14.0% growth and cited restructuring and FX headwinds.
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On Nov. 9, 2026, monday.com reported third-quarter earnings showing record non-GAAP margins and stronger profitability, but the company warned that revenue growth would slow as restructuring, weaker demand from smaller customers, and foreign-exchange pressures weigh on near-term results.
Results and Profitability
For the quarter ended Sept. 30, 2026, monday.com reported revenue of $377.5 million, up 19.0% year over year. GAAP operating income rose to $31.2 million, an 8.0% margin, compared with a $2.4 million operating loss and a negative 1.0% margin in the year-earlier quarter. Non-GAAP operating income reached $89.4 million, with a record 24.0% operating margin. GAAP diluted earnings per share were $0.80, and non-GAAP diluted EPS were $2.14. AI-related annual recurring revenue totaled $36 million from AI credits, agents, and vibe products.
Co-founders Roy Mann and Eran Zinman said, “Our third quarter showed both the strength of our foundation and the work ahead.”
Guidance, Restructuring, and AI Initiatives
Management set fourth-quarter fiscal 2026 revenue guidance at $380 million to $382 million, implying about 14.0% year-over-year growth, down from the third quarter’s pace. They projected non-GAAP operating income of $68 million to $70 million and a non-GAAP operating margin near 18.0%, assuming a negative foreign-exchange impact of 100 to 200 basis points. Full-year fiscal 2026 revenue guidance ranged from $1.473 billion to $1.475 billion, representing roughly 20.0% annual growth, with a full-year non-GAAP operating margin near 18.0%. The outlook reflects ongoing investment in enterprise go-to-market, product development, and AI, alongside foreign-exchange headwinds and near-term operational disruption.
A workforce restructuring announced in July reduced staff by about 20% during the quarter, causing short-term operational challenges. Executives cited softness among smaller customers and longer enterprise sales cycles as factors slowing growth, even as net dollar retention—a measure of recurring revenue retained from existing customers including expansion and contraction—stood at 108.0%. Gross margin was 88.0%, down from 90.0% a year earlier.
Customers generating more than $100,000 in annual recurring revenue increased 33.0% year over year to 2,127. monday.com agents recorded over six million interactions in less than two quarters. Management described these moves and the enterprise focus as part of a broader shift toward an AI-first operating model aimed at deepening penetration in larger accounts over time.
