Monday.com faces securities class action over growth, AI, and enterprise claims

The securities class action against monday.com turned the company’s growth story into a credibility test. The case, Potter v. monday.com Ltd., No. 26-cv-01956, filed in the Southern District of New York, alleges that executives overstated the company’s revenue outlook, AI-driven investments, enterprise adoption and multi-product integration while failing to disclose pressures that were building beneath the surface.

For employees, that matters well beyond the courtroom. The filing says monday.com was facing slower new-customer growth, weaker expansion inside existing accounts and longer enterprise sales cycles, all of which cut against the company’s earlier $1.8 billion revenue target for 2027. The lead-plaintiff deadline is May 11, 2026, but the bigger issue for teams in engineering, product and sales is whether the company can keep converting its AI pitch into repeatable revenue at the pace investors were told to expect.

The complaint centers on a Feb. 9 disclosure, when monday.com said it would stop discussing its previously provided 2027 targets and instead focus on 2026 outlook. That reset followed a quarter in which the company reported $333.9 million in revenue for the fourth quarter of 2025, up 25% year over year, and full-year 2025 revenue growth of 27%. On the same call, monday.com said monday vibe was the fastest product in company history to top $1 million in annual recurring revenue.

Those numbers are precisely why the lawsuit lands with force. As of Dec. 31, 2025, monday.com said it had more than 250,000 paying customers, 4,281 enterprise customers generating more than $50,000 in ARR, and customers above that threshold accounted for 41% of total ARR. Customers with more than $500,000 in ARR grew from 50 to 87 over the prior 12 months. The company also said net dollar retention for customers with more than $50,000 in ARR was 116% in the fourth quarter.

The company had been leaning hard into that story throughout 2025. In the third quarter, monday.com said new products accounted for more than 10% of total ARR, and more than 60,000 apps had been built on monday vibe in about three months. That makes the February guidance reset more than a routine earnings adjustment. It raises the question of whether the company’s AI and enterprise push was advancing as quickly as management had implied, or whether the market was seeing the best-case version of the roadmap.

Monday.com filed its 2025 annual report on Form 20-F on March 13, 2026, after the earnings reset. Now the evidence that matters most is clear: customer expansion, product adoption, disclosure language and management consistency. If those pieces do not line up, the story on MNDY is no longer just about growth. It is about whether the market was sold a faster climb than the business could sustain.