‘While we are seeing significant value from AI internally, this decision was not made to reduce costs or replace people with AI. We see internal AI adoption as an accelerator of our growth. This change was made to adapt the company to our new vision,’ wrote Monday.com Co-founder and Co-CEO Eran Zinman in a LinkedIn post.
AI work platform and project management software developer Monday.com is in the process of laying off about 20 percent of its workforce and is looking to assure investors and employees that the layoffs are not stemming from its own use of AI.
Monday.com, based in Israel with North American headquarters in New York City, on July 22 said in an regulatory filing that the company initiated a restructuring plan to align its organizational structure with its focus on its AI Work Platform.
“The Plan reflects the Company’s ongoing transformation of its product, marketing, and go-to-market strategy and is intended to support a leaner, more focused operating model as the Company continues to invest in its AI-driven growth strategy. The Plan includes a reduction of approximately 20 [percent] of the Company’s current workforce. The Company expects to continue hiring in key strategic areas throughout 2026,” Monday.com said in the filing.
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As a result of the layoffs, Monday.com expects to incur about $45 million to $55 million in net charges. This includes $30 million to $35 million related to severance payments, employee benefits, and related costs, as well as about $30 million to $35 million in charges related to the impairment of certain office space.
Those costs are also expected to be partially offset by about $15 million in non-cash credits for share-based compensation.
Monday.com co-founder and co-CEO Eran Zinman in a LinkedIn post wrote that his company has in the last nine months shifted its core vision from managing work to doing the work for its customers as humans and AI agents increasingly work together in one workspace, which required the company to change its products, strategy, and how it serves customers.
However, Zinman wrote, the company’s organization does not fit the new AI era, leading to the “very difficult” decision to reduce its global workforce by about 620 people, or about 20 percent of its employees.
“This is the most painful decision we have made since founding [Monday.com] – yet we are certain it is the right one. We made it. We own it. And we take full responsibility for it. The people leaving are talented colleagues and friends. They helped build this company, support our customers, and create a culture we are deeply proud of. We are incredibly grateful to them, and we know that nothing we say can lessen the impact this will have on them and their families,” he wrote.
The restructuring comes in response to a new era where AI is transforming the role of software and opening a whole new market, one that requires a fundamental change in how the company operates in order to compete and win, Zinman wrote.
As a result, Monday.com is looking to develop a flatter organization with fewer management layers, more autonomous teams with greater authority to execute, and a new go-to-market model to work more closely with customers, increase its on-site presence, and create new roles while adapting existing roles, he wrote.
“Improving margins was not the purpose of this decision. We intend to reinvest the vast majority of the savings in our people, our products, AI, and future growth,” he said.
Zinman specifically called out concerns that the layoffs stemmed from AI improvements.
“While we are seeing significant value from AI internally, this decision was not made to reduce costs or replace people with AI. We see internal AI adoption as an accelerator of our growth. This change was made to adapt the company to our new vision,” he wrote.
Monday.com spokespeople declined a CRN emailed request for more information, but instead directed attention to the U.S. Securities and Exchange Commission filing and Zinman’s LinkedIn post.
Tyler Manee, president of Ability Ops, a Frederick, Maryland-based solution provider and Monday.com’s 2025 Partner of the Year, told CRN that he has seen Monday.com start providing automated first responses from AI agents starting over three years ago, and that the company’s agents are really improving.
“They’re leaning into AI really hard,” he said. “Monday.com has been around for a while. I think they were built in the era before AI, and now they’re restructuring for the era of AI.”
Manee said he doesn’t expect the layoffs to impact his company other than to encourage it to lean more into AI.
“That’s something we would have done anyway, given the nature of the field that we’re in,” he said. “They’re encouraging us to grow AI partnerships to embody AI in our business processes and to learn how to leverage AI to best help our clients in our specific verticals.”
Ability Ops already runs pretty lean, with only 13 employees, and is pretty much services-focused, Manee said.
“I don’t think AI is in a place where it can replace my people,” he said. “I do think AI is in a place where it can make our builders way faster. We are generating demos in an hour just from a transcript where we used to have to build that manually. We are taking a good in-depth discovery call to do a one-day turnaround of the first draft of a client’s account. And no matter whether you’re leveraging Monday’s agents, or Claude, or additional things, I feel like AI is still only going to get you 80 percent of the way there. It’s not 100 percent because there’s always tweaks and the need to teach the team how to use it.”
Ability Ops uses an AI-based tool in its business processes for things like sales, marketing, invoice processing, as well as for building its own internal tools, Manee said.
“But then in production, we’re using AI for the first draft build of accounts for trickier operations,” he said. “If we’re doing any custom dev, that sort of stuff, we’re leveraging that in our development team. We’re right in line with the times in adopting AI. But we’re only coming up on four years old, so I don’t think we’ve had as long to grow too many layers of hierarchy. I think we’re a flat organization, which is what Monday is readjusting to be.”
