Monday.com cuts 20% of staff in AI platform pivot

Monday.com is reducing its global workforce by approximately 20 percent, eliminating around 620 positions, as the Israeli project management firm pivots toward its AI Work Platform and adopts a flatter organizational structure. The company disclosed the restructuring in a Form 6-K filed with the U.S. Securities and Exchange Commission on Tuesday, explaining that the cuts are necessary to support a leaner operating model aligned with its AI-driven growth strategy. Co-founder and co-CEO Eran Zinman shared a note with staff on LinkedIn, describing the move as the most painful decision Monday.com has made since its founding.

The layoffs come amid a severe downturn for Monday.com’s stock, which has shed more than half its value in 2026 and roughly 75 percent from its 52-week high. The company is caught in the broader SaaSpocalypse selloff, a rout that has hammered enterprise software stocks as investors grow anxious that AI agents and vibe coding could render conventional SaaS tools obsolete. Monday.com’s market capitalization has fallen to roughly $3 billion, a fraction of the valuations it commanded during the pandemic-era software boom.

Zinman framed the restructuring as an offensive maneuver rather than a defensive retreat. He wrote that the company is not making the change to protect what it has but to go all in on what it can become. Over the past nine months, he said, Monday.com has shifted its core vision from managing work to doing the work for customers, with people and AI agents collaborating in one workspace. The organization built for the previous chapter, he argued, no longer suits the new AI era.

The company expects to incur between $45 million and $55 million in restructuring charges. That includes $30 million to $35 million in severance and employee benefits, plus roughly the same amount for office space impairments, partially offset by about $15 million in non-cash credits for share-based compensation. Most charges are expected to hit in the second half of 2026. Monday.com said it plans to keep hiring in key strategic areas even as it cuts elsewhere.

This restructuring mirrors moves by other SaaS companies caught between strong revenue growth and investor anxiety about AI disruption. Fellow Israeli software firm Wix cut 20 percent of its staff in May, citing similar pressures from AI competition and a strengthening shekel. Atlassian cut 1,600 jobs in March and replaced its CTO as part of its own AI pivot. The pattern across the industry is consistent: record or near-record revenues, significant headcount reductions, and savings redirected toward AI.

Zinman addressed the obvious question directly in a FAQ appended to his note. He wrote that the decision was not made to reduce costs or replace people with AI. He described three structural changes: a flatter organization with fewer management layers, more autonomous teams with broader ownership, and a new go-to-market model that puts staff closer to customers as they adopt AI. The company said it intends to reinvest the vast majority of savings in people, products, and future growth.

Whether the market believes that framing remains to be seen. Monday.com reported first-quarter revenue of $351 million, up 24 percent year on year, the kind of growth rate that would have delighted investors two years ago. But in a market where AI is simultaneously the justification for cutting staff and the product companies are pivoting toward, the question is whether restructuring announcements like this one represent genuine strategic shifts or what OpenAI CEO Sam Altman has called AI washing: the practice of citing artificial intelligence to justify decisions driven by other pressures entirely.