monday.com (MNDY) Q2 2025 Earnings Call Transcript | The Motley Fool

Image source: The Motley Fool. Date Monday, Aug. 11, 2025 at 8:30 a.m. ET Call participants Co-Chief Executive Officer & Co-Founder - Roy Mann Co-Chief Executive Officer & Co-Founder - Eran Zinman Chief Financial Officer - Eliran Glazer Takeaways Revenue -- $299 million, representing 27% year-over-year growth. Enterprise Segment Growth -- Record net new adds of customers paying over $100,000 annually, reinforcing upmarket success. monday CRM Annual Recurring Revenue -- Reached $100 million, marking rapid adoption of the CRM product. Non-GAAP Operating Margin -- 15% for the quarter, showing improved operational efficiency. Overall Net Dollar Retention (NDR) -- 111%, with management expecting NDR to remain stable for the remainder of the year; previous quarter was 112% due to lapping a 2024 price increase. Head Count -- 2,867 employees, an increase of 172 from the prior quarter; management expects 30% head count growth in 2025, with deceleration in the second half. Gross Margin -- 90% non-GAAP, with long-term expectations in the high 80s range. Net Income -- $58.3 million, up from $49.3 million in the prior year’s quarter. Diluted Net Income Per Share -- $1.09 on 53.3 million diluted shares outstanding. Adjusted Free Cash Flow -- $64.1 million and a 21% margin; total cash and equivalents at quarter end were $1.59 billion, up from $1.53 billion sequentially. AI Engagement -- 46 million AI-driven actions executed on the platform since launch; AI actions grew by nearly 20 million in the quarter. AI Monetization -- Growth in accounts exceeding the 500 free AI credit limit, driving incremental revenue beginning in early 2025. Guidance-Q3 2025 Revenue -- $311 million to $313 million, representing 24%-25% growth year over year; non-GAAP operating income guidance of $34 million to $36 million, and an operating margin of 11%-12%. Guidance-Full Year 2025 -- Revenue of $1.224 billion to $1.229 billion (approximately 26% growth); non-GAAP operating income of $154 million to $158 million; operating margin around 13%; adjusted free cash flow of $320 million to $326 million with a 26%-27% margin. Research & Development Expense -- $59.2 million or 20% of revenue, an increase from 16% in the prior year’s quarter. Sales & Marketing Expense -- $139.2 million or 47% of revenue, down from 51% in the prior year’s quarter. Management Hires -- Appointment of Harris Beber (Chief Marketing Officer) and Adi Dar (Chief Customer Officer), both reflecting expansion of the executive team in support of enterprise and customer strategy. Need a quote from a Motley Fool analyst? Email [email protected] Risks Roy Mann said, "we do see some pressure from Google on the new side, though it's not something we didn't encounter before," indicating reduced SMB customer acquisition from Google channel changes. Eliran Glazer said, "We saw some weakness in the lower side of the business. Part of it is because of the Google changes, part of it is maybe some other trends that are kind of." Eliran Glazer said, "the number came down from $112 million to $111 million. And we believe this is going to be stabilized...

Preview: ~500 words