Monday.com Crashes 19% as AI Devours Software Dreams

$338 million. That's what Monday.com projected for this quarter's revenue. Wall Street wanted $343 million. A mere $5 million gap sent shares plummeting 19% in a single day. The culprit? Raw fear that AI is coming for software companies' lunch money.

The Software Apocalypse Is Here

This isn't just Monday.com's problem. The iShares software ETF has crashed 22% this year, while Monday.com shares have lost half their value. The terror is real: agentic AI tools might just replace the software we've been paying for.

The irony? Monday.com's actual numbers weren't terrible. Fourth-quarter earnings hit $1.04 per share, beating the $0.92 estimate. Revenue jumped 25% year-over-year to $333.9 million, above analyst expectations. But Wall Street wasn't buying the future.

Full-year revenue guidance of $1.452-$1.462 billion fell short of the $1.48 billion consensus. Even more jarring: operating income projections of $165-$175 million versus analyst expectations of $220.2 million. That's not a miss—that's a crater.

"No AI Impact" Says CEO Who Just Pivoted Everything

Co-CEO Eran Zinman insisted the company sees "no impact currently from any AI company." He highlighted new AI features like agents and a "vibe" capability to boost conversion and engagement. Classic defensive posturing.

But actions speak louder than earnings calls. The company has "pivoted messaging around ads and on its homepage to become more AI focused." They're shifting to become "more AI native," Zinman admitted. If there's no AI threat, why the complete strategic overhaul?

The Disruption Paradox

Here's where it gets interesting. AI tools promise to automate project management, scheduling, and collaboration—exactly what Monday.com sells. But they also create new complexities that need... managing. It's a classic innovator's dilemma wrapped in silicon and venture capital.

Traditional software companies face a brutal choice: cannibalize their own products with AI features, or watch AI-native competitors do it for them. Microsoft figured this out with Copilot. Salesforce is betting big on AI agents. The question isn't whether AI will transform software—it's who survives the transformation.

The Real Battle Ahead

Investors aren't just worried about Monday.com's quarterly miss. They're pricing in an existential question: In five years, will we still need dedicated project management platforms, or will AI assistants handle everything seamlessly?

The software industry built fortunes on creating problems to solve problems. AI threatens to solve the original problems directly. That's not disruption—that's replacement.