monday.com Ltd. Ordinary Shares 2026 Q2 Earnings Call
Review the key takeaways and the transcript of this earnings call.
- Monday.com reported second quarter fiscal year 2026 revenue of $365 million, a 22% year-over-year increase.
- Non-GAAP operating margin expanded to 17% in Q2, up from 15% in the year-ago quarter.
- Net income for Q2 was $65.5 million, with diluted net income per share of $1.48 based on 44.4 million fully diluted shares.
- The company added a record 10,500 net new customers in Q2, with larger customers driving significant growth.
- Gross margin was 89% in Q2, slightly down from 90% a year ago.
- Research and development expense increased to 23% of revenue, while sales and marketing expense decreased to 41% of revenue.
- General and administrative expense was 8% of revenue in Q2, down from 9% in the prior year quarter.
- Adjusted free cash flow for Q2 was $52.3 million, with a margin of 14%.
- Total employee headcount was 3,169, down 42 from Q1 2026, with an expected 20% reduction by fiscal year-end.
- The company completed $182 million in share repurchases during the quarter, fully utilizing its $870 million authorization.
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Transcript
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Good day. My name is Desiree. I will be your conference operator today. At this time, I would like to welcome everyone to monday.com's second quarter fiscal year 2026 earnings conference call. I would like to turn the call over to monday.com's Vice President of Investor Relations, Mr. Byron Stephen. Please go ahead. Hello, everyone.
Thank you for joining us on today's conference call to discuss the financial results for monday.com's second quarter fiscal year 2026. Joining me today are Roy Mann and Eran Zinman, co-CEOs of monday.com, Eliran Glazer, monday.com's CFO, and Casey George, monday.com's CRO. We released our results for the second quarter fiscal year 2026 earlier today. You can find our quarterly shareholder letter along with our investor presentation and a replay of today's webcast under the News and Events section of our IR website at ir.monday.com. Certain statements made on the call today will be forward-looking statements, which reflect management's best judgment based on the currently available information. These statements involve risks and uncertainties that may cause actual results to differ from our expectations.
Please refer to our earnings release for more information on the specific factors that could cause actual results to differ materially from our forward-looking statements. Additionally, non-GAAP financial measures will be discussed on the call. Reconciliations to the most directly comparable GAAP financial measures are available in the earnings release and the earnings presentation for today's call, which are posted on our investor relations website. Now, let me turn the call over to Roy.
Thank you, Byron. Thank you everyone for joining us today. Over the past nine months, monday.com has undergone the most meaningful strategic shift in our history. We moved from building software that helps people manage work to building software that does the work, with people and AI agents operating together in a single unified workspace. That shift changed our product, our strategy, and how we serve our customers. It also required us to change ourselves. On July 22nd, we reduced our global workforce by approximately 20%. It was the hardest decision we have made since founding the company. The people who left were talented colleagues who built something we are proud of. We are grateful for everything they contributed. We are also certain it was the right call. Our focus is not to protect where we are, but to position us for where we are going.
Most of the savings will be reinvested in the people, products, and AI. What changes is how we operate with fewer management layers, smaller teams, and real decision-making authority, and a go-to-market model built around the deeper customer partnership that AI deployment demands. Our Q2 results reflect the strength of the business we are building from. Q2 revenue grew 22% year-over-year, while Q2 non-GAAP operating margin expanded to 17%. The record net additions of 100K+ and 500K+ customers in Q2 reflect the continued strength of our upmarket motion. Larger customers continue to be an important driver of our business, and we remain focused on deepening these relationships as we expand our AI capabilities. In July, we crossed $1.5 billion in ARR, a milestone that reflects the durability of our core business, even as we reshape the company around AI.
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