Monday.com 's stock plummeted more than 19% on Monday after the project management platform issued weak guidance as it grapples with rising concerns that artificial intelligence is disrupting the software business model.
The Israel-based company called for revenue between $338 million and $340 million in the current quarter, short of the $343 million expected by analysts polled by FactSet. For the full year, monday.com forecasted between $1.452 billion and $1.462 billion in revenue, versus a FactSet estimate of $1.48 billion.
Software stocks have sold off in recent weeks on rising AI disruption fears and worries that new agentic tools can replace them.
So far this year, the iShares Expanded Tech-Software Sector ETF (IGV) has plummeted 22%, while shares of monday.com have already lost half their value.
During an earnings call with analysts, management defended the company's market position and highlighted new AI capabilities being implemented, such as agents and a vibe feature, to improve conversion and engagement.