Monday.com is laying off about 620 employees, roughly 20% of its global workforce, as it reshapes the company around AI agents instead of traditional work management software.
Investors welcomed the announcement, which immediately sent the company’s shares higher after management outlined a new strategy focused on what it calls an AI Work Platform.
The decision marks one of the biggest AI-driven restructurings in enterprise software this year. It also reflects a broader shift across the software industry where companies are reorganizing teams, products, and spending to build AI-first businesses rather than simply adding AI features to existing products.
Monday.com Is Rebuilding Around AI Agents
In a letter to employees, co-founders and co-CEOs Roy Mann and Eran Zinman said Monday.com is changing from a company that helps people manage work into one that enables people and AI agents to complete work together. The restructuring will flatten parts of the organization while increasing investment in AI engineering and product development.
The company stressed that the layoffs are tied to its long-term strategy rather than an effort to improve short-term profit margins or replace employees with AI. Instead, executives said the goal is to redirect resources toward building products designed for the next generation of enterprise software.
The restructuring is expected to result in charges of between $45 million and $55 million.
Why Investors Responded Positively
Despite the job cuts, the market focused on Monday.com’s long-term direction.
It is clear that investors increasingly want software companies to show they have a credible AI strategy. In recent months, many enterprise software firms have faced pressure to prove they can adapt to AI agents that automate tasks previously completed through conventional software workflows.
Monday.com believes AI will fundamentally change how work gets done inside organizations. As such, rather than acting only as a project management platform, the company wants its software to become a workspace where human employees and AI agents work together to complete business processes.
A Wider Shift Across Enterprise Software
Monday.com;s announcement comes as software companies race to redesign their businesses around generative AI.
Many vendors have launched AI assistants over the past two years, and the focus is now moving beyond assistants toward autonomous AI agents that can carry out tasks with limited human involvement. This shift requires new products, different engineering priorities, and in some cases, different organizational structures.
For enterprise software companies, success is no longer measured only by how well they help employees organize work. Increasingly, the goal is now to build platforms where AI performs a growing share of the work itself while employees supervise and guide the process.
The positive market reaction suggests investors are rewarding companies that make that transition early, even when it comes with difficult decisions such as significant workforce reductions.
