Work management platform monday.com (NASDAQ: MNDY) beat Wall Street’s revenue expectations in Q1 CY2026, with sales up 24.5% year on year to $351.3 million. The company expects next quarter’s revenue to be around $355 million, close to analysts’ estimates. Its non-GAAP profit of $1.15 per share was 23.4% above analysts’ consensus estimates.

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StockStory’s Take

monday.com’s first quarter results were well received, as the company delivered higher-than-expected revenue and profitability. Management credited sustained demand from enterprises consolidating their work management tools and highlighted strong adoption of its newly launched AI capabilities. Co-CEO Roy Mann pointed to “a record number of new customers with over $500,000 in annual recurring revenue” and noted that AI-driven products contributed meaningfully to customer engagement and operational efficiency.

Looking forward, monday.com’s updated guidance is shaped by continued investment in AI-driven products, the rollout of a new consumption-based pricing model, and expectations for gradual adoption among existing customers. Co-CEO Eran Zinman described the shift as “the most significant step in our journey,” emphasizing plans to let AI agents execute work alongside human users. CFO Eliran Glazer acknowledged that while AI presents new revenue opportunities, the company anticipates increased computing expenses and plans to monitor adoption rates and cost impacts as the year progresses.

Key Insights from Management’s Remarks

Management attributed first quarter performance to robust enterprise demand, early traction from AI products, and the company’s rearchitecture around AI-led workflows.

• Enterprise customer expansion: Management highlighted growing enterprise momentum, with average contract values increasing and a record number of new customers exceeding $500,000 in annual recurring revenue. The shift toward larger, multi-product deals indicates deeper platform adoption.
• AI product contribution: AI products generated approximately 10% of net new annual recurring revenue (ARR), according to Eran Zinman. Management expects this figure to rise as AI agents and related features expand and mature on the platform.
• Consumption-based pricing launch: monday.com introduced a new pricing structure combining user seats with AI credit consumption, aiming to better align revenue with actual usage. The model initially applies to new customers, with existing customers offered gradual incentives to switch.
• One AI acquisition: The company announced the acquisition of One AI, bringing in native voice agent capabilities. Management believes this will enhance the platform’s ability to automate and facilitate work across customer-facing and internal workflows.
• Operational efficiency gains from AI: Internally, AI adoption has led to a 32% increase in developer output and a 38% reduction in product time to market, with management suggesting these improvements are early evidence of the productivity benefits that AI can drive.

Drivers of Future Performance

monday.com’s outlook is driven by the adoption of AI-powered features, the transition to consumption-based pricing, and continued enterprise expansion.

• AI adoption and monetization: The company sees AI agents and related products as a significant future growth driver, but management cautioned that actual adoption rates and resulting revenue are uncertain. Increased computing costs associated with AI are expected to pressure gross margins in the near term.
• Customer migration to new pricing: Management is incentivizing existing customers to shift to the new seat-plus-credit pricing model, which could drive higher long-term revenue as AI usage expands. However, the transition is planned as an opt-in process and is expected to unfold gradually over several quarters.
• Enterprise and multi-product growth: Strong performance in mid-market and enterprise segments, with more customers adopting multiple products, is expected to support future revenue growth. Management highlighted cross-sell opportunities, especially as the company integrates new AI and voice capabilities into its core offerings.

Catalysts in Upcoming Quarters

Looking ahead, our analysts will be watching (1) the rate of customer adoption and monetization of AI agents and the new consumption-based pricing, (2) the integration and customer uptake of voice capabilities from the One AI acquisition, and (3) continued growth in enterprise and multi-product adoption. The impact of increased computing costs on margins and the pace of existing customer transitions to new pricing will also be important areas to monitor.

monday.com currently trades at $76.44, up from $72.17 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).

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