Monday.com Revenues Rise 85%; Shares Rise 4% Pre-Market

Monday.com Ltd. (NASDAQ: MNDY) shares jumped almost 4% in the pre-market trading session on May 16, after the company delivered a first-quarter revenues beat and also raised its FY2022 guidance above the analyst expectations.

The Monday.com provides Work OS, a work operating system that is an open platform that helps organizations to build work management tools and software applications to manage their work.

Q1 Performance

Markedly, revenues jumped 84% year-over-year to $108.5 million and exceeded consensus estimates of $101.22 million.

The increase in revenues reflected a surge in customers with more than $50,000 Annual Recurring Revenue (ARR), which increased 187%, as well as a strong 150% retention rate for customers in the same category.

On the downside, the company reported an adjusted loss of $1.48 per share, much higher than the street’s estimated loss of $1.02. However, it was a significant improvement over the previous year’s loss of $3.52 per share.

Raised FY2022 Outlook

Based on robust Q1 revenues, management raised the financial guidance for FY2022.

For the full year, the company now forecast revenues to grow between 58% and 60%, and to be in the range of $488 to $492 million, higher than the prior-guided range of $470 million to $475 million.

However, the company forecasts reporting an operating loss of $139 million to $135 million with a negative operating margin of 28% to 27%.

For the fiscal second quarter, revenues are projected to grow between 66% to 69% to be in the range of $117 million to $119 million, higher than the consensus estimate of $110.88 million.

On the other hand, Q2 adjusted operating loss is expected to be around $35 million to $33 million with a negative operating margin of 30% to 28%.

CEO’s Comments

Monday.com founder and co-CEO, Roy Mann commented, “We are excited to take the next step in our product evolution with the introduction of monday Work OS products.”

He further added, “These new end-to-end products will provide our customers with more robust solutions containing advanced features and capabilities to address their specific needs.”

Wall Street’s Take

Overall, the stock has a Strong Buy consensus rating, based on 7 Buys and 1 Hold. The average Monday.com stock forecast of $250 implies 126.49% upside potential from current levels.

Monday.com Website Traffic

Notably, TipRanks’ Website Traffic Tool provided insight into Monday.com’s Q1 performance well ahead of its earnings.

According to the tool, in Q1,  Monday.com’s website traffic showed a 30.41% increase in total visits from the previous quarter, and more than 64% growth from the same quarter for the same period last year.

Key Takeaway

Clearly, monday.com continues to win large customers that drove robust Q1 revenues beat.

Robust top-line growth spurred by strong underlying demand, as well as outstanding retention rates, are paving the way for strong growth for the company in the longer term.

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