Business

Know the Business — The Record

monday.com sells subscriptions to a cloud-based "Work OS": a no-code/low-code platform on which organizations build and run their own work-management applications, billed as monthly or annual seat-based plans, with customers having no ability to take possession of the software [1]. For the year ended December 31, 2025 it reported revenue of $1,231,997 thousand, up 27% year over year, against an ~89% gross margin, a GAAP operating loss of $1.7 million, and net income of $118.7 million [2]. This page lays out the mechanics of the record — how the company charges, what it sells, the unit economics, the metrics it discloses, the balance sheet, and who controls it — with each figure linked to the page that states it. The industry-level economics (TAM, the SaaS category, the competitive map) are covered on the Industry tab; this page is monday.com's own business.

How the money comes in: seats, tiers, products, billed in advance

The revenue model is a self-serve funnel that converts into recurring subscriptions. A prospect enrolls in a 14-day free trial of the Pro plan for the relevant product, after which they either continue on a Free plan limited to two users or pay for one of four paid subscription tiers [3]. As of December 31, 2025 the company had over 250,000 paying customers — defined as a unique web-domain account on a paid plan — versus nearly 245,000 a year earlier, with no single customer accounting for more than 1% of revenue and the top 100 customers representing less than 10% [4].

Because monday.com generally invoices in advance of delivering service, cash arrives before revenue is recognized: deferred revenue was $411.6 million at December 31, 2025 (up from $342.6 million), which the company describes as a principal source of funds, with the majority expected to convert to revenue within 12 months [5]. Contracted-but-unrecognized revenue (remaining performance obligations) stood at $838.9 million, of which the company expects to recognize approximately 81% over the next 12 months [6].

Sources: paying customers and concentration, FY2025 20-F [7]; deferred revenue [8]; RPO [9].

What it sells: one flagship plus a four-product suite, with an AI layer

The flagship product is monday work management, "the complete solution for connecting strategy to effective execution, at scale," built from no-code/low-code building blocks across departments, with portfolio and resource-management features aimed at enterprises [10]. The company states in its risk factors that it "derive[s] a majority of [its] revenue from monday work management" [11]. On top of the same platform sit three additional products: monday CRM, a customizable sales-cycle product that in 2025 expanded into a suite with the AI-powered monday campaigns marketing product [12]; monday service, an AI-assisted enterprise service-management product [13]; and monday dev, for product and development teams [14].

The company reports that monday CRM surpassed $100 million in ARR in 2025, that mondayDB 3.0 launched, and that it introduced monday campaigns [15]. At its 2025 Investor Day it stated that "monday CRM reached $100M ARR in just three years and monday Service is the fastest-growing product ever," and framed mondayDB as "the enterprise-grade foundation for AI apps" [16]. A developer marketplace extends the platform: as of December 31, 2025 it held 869 apps, 704 of them with native monetization, distributed to the company's customer base [17]. In 2025 the company added four AI capabilities — monday vibe (a no-code AI app builder), monday agents, monday workflows, and monday sidekick (a context-aware conversational companion that "executes work on behalf of users") [18].

The expansion engine: land-and-expand, by the disclosed numbers

The reported growth mechanism is seat and product expansion within accounts that began small. The clearest evidence is the enterprise cohort: customers with more than $50,000 in ARR grew 34% to 4,281, those above $100,000 grew 45% to 1,756, and those above $500,000 grew 74% to 87; ARR from the $50,000+ cohort grew 42%, outpacing overall ARR, and reached 41% of total ARR (from 36%) [19]. Larger accounts also attach more of the suite: 29% of enterprise customers had adopted multiple products versus 6% of sub-$50,000 customers [20].

Source: FY2025 20-F, Consistent Growth of Enterprise Customers [21].

The single metric that captures whether the installed base grows on its own is Net Dollar Retention. For the three months ended December 31, 2025 it was 110% overall, 116% for customers above $50,000 ARR, and 116% for customers above $100,000 ARR; the company notes the 2024 reading was "positively impacted by pricing adjustments implemented during 2024 and the first half of 2025," and that 2025 "reflects continued seat and product expansion … partially offset by the anniversary of pricing adjustments" [22].

Source: Net Dollar Retention for all customers and the over-$50K and over-$100K cohorts (Q4 2025/2024/2023), FY2025 20-F [23].

The cost structure and operating leverage

Cost of revenue is light — credit-card and hosting/cloud-infrastructure fees (including AI compute), capitalized-software amortization, and support salaries — leaving gross margin at roughly 89% in each of the last three years; the company expects gross margin "to decline modestly in the mid-term" as AI-compute costs rise, before stabilizing [24]. The operating cost base is dominated by people. As a share of revenue, sales and marketing fell to 51% (from 55% and 60%), research and development rose to 26% (from 22% and 21%), and general and administrative was 12% (from 15% and 13%); sales-related commissions fell to roughly 2% of revenue from 5% and 6% on a changed commission model [25].

Source: S&M, R&D and G&A as a percentage of revenue, FY2025 20-F [26]; R&D percentage [27].

The fall in S&M as a share of revenue while R&D rose is the visible operating-leverage trade-off in the reported numbers: the GAAP operating loss narrowed from $38.6 million (FY2023) to $21.0 million (FY2024) to $1.7 million (FY2025) [28].

Profit quality: where the $118.7 million of net income came from

GAAP operating income was roughly breakeven, so reported net income did not come from operations. The bridge below traces it: a $1.7 million operating loss, plus $61.1 million of financial income (interest on cash, deposits and marketable securities), giving $59.3 million of pre-tax income; net income of $118.7 million then exceeds pre-tax income because of a $59.4 million income-tax benefit, which the company attributes to a one-time $61.1 million reversal of the valuation allowance on deferred tax assets [29].

Source: operating loss, financial income, pre-tax income, tax benefit and net income, FY2025 20-F [30]; valuation-allowance reversal [31].

A second gap between GAAP and cash profitability is share-based compensation. Total SBC was $177.0 million in 2025 (versus $129.2 million and $100.2 million), with R&D carrying the largest share ($82.3 million); SBC alone exceeds reported net income [32]. The company's own non-GAAP operating income, which adds SBC (and, in 2024, a foundation contribution) back to the GAAP operating loss, was $175.3 million in 2025, $132.4 million in 2024 and $61.6 million in 2023 [33].

Sources: SBC [34]; net income [35]; non-GAAP operating income [36].

Cash generation and capital allocation

The business converts subscriptions to cash well ahead of GAAP profit. Net cash from operating activities was $333.6 million in 2025 (27% of revenue); company-defined adjusted free cash flow — operating cash flow less property/equipment and capitalized-software spend, plus headquarters build-out costs — was $322.7 million, $295.8 million and $204.9 million across 2025/2024/2023 [37]. The non-cash add-backs that close the gap between $118.7 million of net income and $333.6 million of operating cash are visible in the cash-flow statement: $177.0 million of SBC, a $69.0 million deferred-revenue inflow, and a $61.2 million non-cash deferred-tax item [38].

Sources: operating cash flow and adjusted free cash flow, FY2025 20-F [39].

The balance sheet carries no borrowings. At December 31, 2025 the company held $1,503.1 million of cash and equivalents plus $162.3 million of marketable securities against total liabilities of $859.8 million, the bulk of which is deferred revenue ($411.6 million) and operating-lease liabilities (~$168.8 million) rather than debt; cash paid for interest in 2025 was nil [40]. In September 2025 the board authorized a share-repurchase program of up to $870 million with no expiration; the company bought back 883,913 shares for $135.0 million in Q4 2025, leaving $735.0 million of authorization [41].

Sources: cash and marketable securities and absence of debt, Consolidated Balance Sheets [42]; repurchase authorization [43].

Cash profitability versus the named peers

monday.com's filings name competitors across four fronts — work management, customer relationship management, enterprise service management, and software development [44]; the publicly traded ones include the work-management pure-plays Asana and Atlassian, Freshworks (CRM/service), and the larger adjacent platforms ServiceNow and Salesforce — not all the same business model (see the Industry tab). One comparison the Industry tab did not draw is cash profitability combined with growth. The table reports each company's latest fiscal year: free cash flow (operating cash flow less capital expenditure) as a percentage of revenue, revenue growth, and their sum (the "Rule of 40").

Sources: derived from each company's reported financials — monday.com FY2025 [45]; Asana cash flow [46] and revenue [47]; Freshworks cash flow [48] and revenue [49]; Atlassian cash flow [50] and revenue [51]; ServiceNow cash flow [52] and revenue [53]; Salesforce cash flow [54] and revenue [55].

For reference against the table, the underlying free-cash-flow dollars were: Asana $86.6 million [56], Freshworks $236.7 million [57], Atlassian $1,415.5 million [58], ServiceNow $4,576 million [59], and Salesforce $14,402 million [60], against monday.com's $309.9 million [61].

Geography and workforce

The company operates as a single reportable segment and discloses revenue by geography. In FY2025 the United States supplied $619.2 million of the $1,232.0 million total, with EMEA at $264.5 million, the United Kingdom at $134.6 million, and the rest of the world at $213.8 million [62]. The workforce numbered 3,155 employees at year-end, of whom 1,729 (55%) were in Israel — the company is headquartered in Tel Aviv — with the remainder split across the Americas (755), Europe (514) and APAC (157) [63].

Source: breakdown of employees by region, FY2025 20-F [64].

Ownership and control

monday.com is an Israel-incorporated foreign private issuer that IPO'd on Nasdaq in June 2021. All ordinary shares carry the same voting rights, and the company states that none of its principal shareholders, directors or senior management have special voting rights; 51,160,822 ordinary shares were outstanding at December 31, 2025 [65]. Co-founder Roy Mann beneficially owned 9.6% and co-founder Eran Zinman 3.4%; all executive officers and directors as a group held 13.9%, alongside institutional holders WCM Investment Management (7.4%) and Capital World Investors (6.4%) [66].

Separately from the ordinary shares, one co-founder/co-CEO holds a single non-tradable "founder share" carrying no dividend or ordinary voting rights but conferring veto rights over certain transactions — mergers or share issuances that would put 25% or more of the shares in one party's hands, a sale of substantially all assets, and changes to the company's Equal Impact Initiative strategy; it converts to a rights-free deferred share on transfer, the co-CEO's departure or death, or dilution below a set threshold [67].

Source: beneficial ownership by officers and directors, FY2025 20-F [68].

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