Monday.Com Ltd (MNDY) Q3 2024 Earnings Call Highlights: Strong Revenue Growth and Strategic Shifts

GuruFocus.com11-13

Revenue: $251 million in Q3 '24, up 33% from the year-ago quarter. Annual Recurring Revenue (ARR): Surpassed $1 billion. Net Dollar Retention (NDR): Increased to 111% in Q3 '24. Gross Margin: 90% in ...

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GuruFocus has detected 1 Warning Sign with MNDY.\n\nRelease Date: November 11, 2024\nFor the complete transcript of the earnings call, please refer to the full earnings call transcript.\n Positive Points \n\nMonday.Com Ltd (NASDAQ:MNDY) surpassed $1 billion in annual recurring revenue, marking a significant milestone for the company.\nThe company reported strong revenue growth of 33% year-over-year, with Q3 2024 revenue reaching $251 million.\nMonday.Com Ltd (NASDAQ:MNDY) showcased robust product development, including the introduction of monday AI and enhancements to monday CRM.\nThe Elevate Conference saw a 150% increase in the use of AI blocks since Q2, indicating strong adoption of new technologies.\nThe company maintains a high gross margin of 90%, with expectations to remain in the high 80s range in the medium to long term.\n\n Negative Points \n\nThere was a noted softening in net new customer additions, attributed to a strategic focus on larger enterprises and price increases.\nThe departure of Chief Revenue Officer Yoni Osherov could lead to potential turbulence during the transition period.\nMonday.Com Ltd (NASDAQ:MNDY) experienced slower-than-expected growth in monday dev, impacting overall performance.\nThe company faces macroeconomic choppiness, particularly affecting enterprise customer additions.\nSales hiring was slower than anticipated, which may impact future growth momentum.\n\n Q & A Highlights \nQ: Can you share how monday.com's engagement with customers is evolving and whether you're seeing any changes in the broader demand or competitive environment? A: Eran Zinman, Co-CEO, mentioned that they see good retention results with improving NRR and record-level gross retention. While there is a slight decrease in new customer adds, this is part of their strategy to focus on larger enterprises. Overall, demand remains steady, similar to previous quarters.\nQ: How are you thinking about expansion versus larger new land, especially in light of the second largest customer expansion? A: Eran Zinman explained that the hiring of more salespeople is due to the demand and opportunities within their customer base. They are confident in their growth plans for 2025, focusing on both expanding existing customers and acquiring new ones, with stable market demand.\nQ: Do you think monday service might have a bigger cross-sell opportunity versus CRM, and could it be realized faster? A: Roy Mann, Co-CEO, noted that while monday service shows great cross-sell potential, it is still in beta and not expected to significantly impact revenue next year. However, it holds substantial growth potential for the future.\nQ: What are the key product milestones for monday service to hit before GA release? A: Eran Zinman stated that they want to ensure the product is mature enough to scale within existing customers, including midmarket and enterprise. Key features to finalize include a customer portal and AI functionality, with a full release expected soon.\nQ: With Yoni's departure, how will you manage the transition in sales leadership? A: Eran Zinman assured that Yoni will remain as an adviser until a new CRO is appointed. They are confident in finding a replacement soon and have a stable transition plan with strong management in place.\nQ: Can you provide an update on CRM traction and future plans? A: Roy Mann highlighted that they are scaling CRM to support larger businesses, enhancing infrastructure, and integrating AI to improve sales processes. CRM remains a strong growth area with continued investment.\nQ: How is the sales rep motion structured, and will leadership changes affect it? A: Eran Zinman explained that the sales organization is segmented by customer size, with AEs focusing on new business and AMs on expanding existing accounts. They plan to scale this structure, especially in enterprise, with new leadership potentially enhancing this motion.\nQ: How are you addressing the competitive landscape as you push into new product areas and upmarket? A: Roy Mann noted that while they face more competition in larger deals, much of their adoption still comes from greenfield opportunities. They continue to compete effectively, particularly in CRM.\nFor the complete transcript of the earnings call, please refer to the full earnings call transcript.This article first appeared on \nGuruFocus.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.2","shortVersion":"4.29.2","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2483047655"}