Monday.com (NASDAQ:MNDY) Faces Challenges Despite Strong Earnings

Core Viewpoint - Monday.com (NASDAQ:MNDY) is facing significant challenges despite a strong fourth-quarter performance, with a notable drop in stock price following a weaker-than-expected revenue outlook for 2026 [2][5][6] Financial Performance - The company reported adjusted earnings of $1.04 per share for the fourth quarter, exceeding expectations of 92 cents [3] - Revenue for the fourth quarter increased by nearly 25% to $333.88 million, surpassing forecasts of $329.7 million [3][5] - The non-GAAP operating margin decreased to 12.5%, and the free cash flow margin dropped to 17.0%, raising concerns about slowing growth and margin pressure [3] Stock Performance and Market Reaction - Following the release of its weaker revenue guidance for 2026, Monday.com's stock dropped over 20% [2][6] - The stock experienced a significant decline of over 19% due to concerns about AI's impact on the software industry and disappointing revenue projections for the current quarter [4] - Oppenheimer set a price target of $130 for MNDY, indicating a potential increase of about 70.09% from its current price of $76.43 [1][6] Future Outlook - Monday.com projected its 2026 revenue between $1.45 billion and $1.46 billion, which is below analysts' average estimate of $1.48 billion [2] - For the current quarter, the company projected revenue between $338 million and $340 million, falling short of the $343 million anticipated by analysts [4]