Monday.com Stock Crashes: Here’s Why Traders Are Panicking

Another day, another tech stock getting mauled by the market.

Monday.com—the darling of workflow automation—just got its wings clipped. Shares nosedived as Wall Street's algo-traders executed their favorite move: sell first, ask questions later.

The Bloodbath Breakdown

No fancy earnings miss or scandal here. Just good old-fashioned profit-taking meets sector-wide jitters. SaaS valuations were looking frothier than a cappuccino at peak crypto mania.

VCs Exit Stage Left

Insider selling? Check. Lockup expirations? You bet. The smart money's already halfway to the Bahamas while retail traders hold the bag—classic market poetry.

One hedge fund manager quipped: 'We told clients this was the next Slack. Forgot to mention we meant the post-IPO version.' Ouch.

Tech's latest 'essential' platform now faces its ultimate stress test: proving it's not just another pandemic-era bubble waiting to pop.

Image source: Getty Images.

Despite bright spots in the earnings report, investors sense clouds on the horizon

Beating on both top and bottom lines, Monday.com reported Q2 2025 revenue of $299 million and diluted earnings per share (EPS) of $1.09. Analysts had expected the company to report sales of $293.6 million and EPS $0.86.

Investors, however, seem to be concerned about the guidance management issued. For one thing, the company projects 2024 sales of $1.22 billion to $1.23 billion, representing year-over-year growth of about 26%. Should the company achieve this guidance, it WOULD represent a notable slackening of revenue growth. In 2024 and 2023, the company reported year-over-year revenue growth of 33.2% and 40.7%, respectively.

Similarly, investors are concerned about Monday.com's cash-flow prospects. Management projects 2025 adjusted free cash FLOW of $320 to $326 million, representing an adjusted free-cash-flow margin of about 26% to 27% -- a slimmer margin than the 30% adjusted free-cash-flow margin it generated in 2024 and the 28% adjusted free-cash-flow margin it posted in 2023.

Are investors right to ring the alarm bells now?

While the 2025 forecast may be disappointing investors, it seems the market is overreacting. If the company achieves its 2025 guidance, it will still represent strong revenue growth and free-cash-flow margin. For those looking for a time to pick up shares of tech stock Monday.com, today is a great buying opportunity.