Investors unimpressed as monday.com Q1 beats analysts

Work management system company Monday.com (Nasdaq: MNDY), beat the consensus analysts’ estimates in its first quarter results announced today. Quarterly revenue totaled $109 million, and the company posted a non-GAAP net loss of $0.96 per share. The company’s revenue guidance for the second quarter is also ahead of analysts’ estimates, at $117-119 million, representing growth of 66-69% in comparison with the second quarter of 2021.

For the full year 2022, Monday.com expects total revenue of $488-492 million, representing year-over-year growth of 58% to 60%, and a non-GAAP operating loss of $139-135 million.

Monday.com was floated on Nasdaq nearly a year ago at $155 per share, and within a short time its share price shot up to $445, but since the release of its 2021 financials the share price has dropped below the IPO price. Following the release of the first quarter results today, the share price is down 7% to just below $103, giving a market cap of $4.54 billion.

First quarter revenue, was 84% higher than in the corresponding quarter, but the rate of growth is expected to moderate in the second quarter and over the rest of the year. On a GAAP basis, Monday.com posted a net first quarter loss of $66.7 million, which compares with a loss of $39 million in the corresponding quarter.

On a non-GAAP basis the company made an operating loss of $43.8 million, which compares with a loss of $23.3 million in the first quarter of 2021; the non-GAAP operating margin was negative 40%, the same as in the first quarter of 2021.

At the end of the first quarter, Monday.com had cash and cash equivalents amounting to $850 million.

“In the first quarter we made meaningful progress in capturing our large market opportunity with strong top line growth and increasing net dollar retention,” said monday.com co-founder and co-CEO Roy Mann. “We are excited to take the next step in our product evolution with the introduction of monday Work OS products,” said monday.com co-founder and co-CEO, Eran Zinman. “These new end-to-end products will provide our customers with more robust solutions containing advanced features and capabilities to address their specific needs.”

CFO Eliran Glazer added: “While growing and scaling the company will remain our top priority, we are equally focused on improving capital efficiency and operating leverage as we move forward.”

Published by Globes, Israel business news – en.globes.co.il – on May 16, 2022.

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