Why Monday.com Stock Lost 37% in February

By Jeremy Bowman – Mar 3, 2026 at 11:02PM ESTKey PointsSoftware stocks continued to fall in February on fears of AI disruption.Monday beat estimates in its fourth-quarter earnings report, but it wasn't enough to please investors.Guidance was disappointing, and it's showing weakness in its lower-tier self-serve customers. Software stocks got pounded last month as the narrative that AI would disrupt enterprise software-as-a-service (SaaS) products took hold. Anthropic introduced new plug-ins for Claude Code and Claude Cowork, showing that AI products could be closer to challenging traditional software products than investors thought. Monday.com (MNDY +3.65%) was one of the biggest losers in the month as the customer relationship management (CRM) software company is seen as vulnerable to AI pressure, and it disappointed investors with its fourth-quarter earnings report. According to data from S&P Global Market Intelligence, the stock fell 36.7% in the month. As you can see from the chart below, the sell-off came in the first week of the month as the software sell-off continued and as its earnings report disappointed. MNDY data by YCharts What happened to Monday.com Monday.com was sliding in the first week of the month, along with the rest of the SaaS sector, as negative sentiment that began late in January and picked up steam in February. When it reported fourth-quarter earnings on Monday.com, the SaaS company seemed to confirm those fears, even though it beat headline estimates in the report. Revenue rose 25% to $333.9 million, ahead of the consensus at $329.7 million, and the company said that Monday Vibe, its vibecoding app builder, was the fastest product to reach $1 million in annual recurring revenue (ARR) in its history. However, that may explain why investors are fearful of AI disruption, as those are the kinds of AI tools that investors believe can compete with Monday. Monday eked out a generally accepted accounting principles (GAAP) operating profit, and it reported an adjusted earnings per share of $1.04, which was down from $1.08 but beat the consensus of $0.92. Despite those results, investors were still spooked by the company's guidance and signs that growth in smaller customers was slowing, a sign that AI could be starting to challenge it. Image source: Getty Images. Where Monday.com goes in 2026 Looking ahead to 2026, the company expects revenue growth of 18%-19% to $1.452 billion-$1.462 billion, below estimates at $1.48 billion. First-quarter revenue guidance of $338 million-$340 million was also below the consensus. Monday has fallen sharply over the last six months on signs of weakening growth, and it seems like shaking the AI threat will be difficult, at least without a reacceleration in revenue growth. Its valuation has come down substantially, but investors may need to see meaningful growth in GAAP profits for the stock to recover. Read NextFeb 21, 2026 •By Will HealyWhetstone Dumps 79,000 monday.com Shares Worth $15.3 MillionFeb 17, 2026 •By Motley Fool StaffAI Capital Expenditure (Capex) Is Off the Charts: Who Stands to Lose?Feb 12, 2026 •By Anders BylundWhy Monday.com Stock is Down 25% This WeekFeb 12, 2026 •By Timothy GreenThe Vibe Coding Tool That's Growing Faster Than Anything Monday.com Has Ever BuiltFeb 9, 2026 •By Jeremy BowmanWhy Monday.com Stock Was Tumbling TodayJan 15, 2026 •By Brett SchaferWhy Monday.com Stock Sank In 2025About the AuthorJeremy Bowman has been a contributing Motley Fool stock market analyst, covering technology, consumer goods, and macroeconomic trends since 2011.

Before The Motley Fool, Jeremy was a newspaper reporter, restaurant manager, and English teacher abroad. He holds a bachelor’s degree in English from Colorado College and a master’s degree in business administration from American University. One of his Motley Fool headlines was briefly featured on Late Night with Stephen Colbert.TMFHoboX@TMFBowmanStocks MentionedMonday.comNASDAQ: MNDY$73.57(+3.65%)+$2.59*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.