Roy Mann moves more monday.com customers to seats plus AI usage fees

monday.com, the work management software company, reported third-quarter results on 9 November with $36m (£27m) of annual recurring revenue (ARR) from its AI products: AI credits, agents and the vibe app builder. On the earnings call that day, co-chief executive Roy Mann told analysts that “we’re gradually moving more customers to hybrid pricing, combining seats with usage-based AI consumption”.

Revenue for the three months to 30 September rose 19% year on year to $377.5m (£281.4m). Co-chief executive Eran Zinman said the AI figure was “led by growing use of AI credits”. Answering Tom Blakey of Cantor Fitzgerald, Zinman said AI ARR “is not incremental yet” and is counted inside the company’s overall ARR. The results release defines AI ARR to include stand-alone AI products, credit packages sold for a subscription term and the portion of subscription plans attributable to included AI credits.

One AI credit costs £0.00875

Credits are the unit monday.com uses to meter AI. A company blog post updated on 1 November says customers who joined on or after 6 May 2026 buy a minimum monthly allocation with their seats: 1,000 credits on the Basic plan, 2,000 on Standard and 3,000 on Pro, drawn from one pool shared across the account. The sterling pricing page lists those plans at £8, £11 and £17 per seat per month on annual billing.

One credit costs $0.01, or £0.00875 at the company’s sterling rate, and extra credits are sold in predefined buckets. By monday.com’s estimates, a simple agent task uses about 10 to 50 credits and an extra complex one 250 or more, while the AI notetaker uses 120 credits per meeting hour. Admins get alerts at 80% and 100% of the allocation. At the limit, some AI capabilities keep running for a short period before credit-consuming use is paused.

Mann said customers “pay for AI extra to their regular pricing”. Asked by Taylor McGinnis of UBS about credits and seats, he said AI spending is “generally an addition, and it’s recurring”. Zinman said customers found hybrid pricing harder to adopt at first and that it caused “a little bit of a longer sales cycle”.

Larger accounts use 4.4 times as much AI

Among customers paying more than $50,000 (£37,000) a year, “Over 30% of those accounts pay for AI credits and use it,” Zinman said. He put their adoption and use of AI at 4.4 times that of other customers. That group numbered 5,038 at 30 September, up 26% in a year, and accounts for 44% of ARR. Customers with more than 10 users grew 5% to 65,965.

The largest customer deployment has passed 87,000 seats, and monday agents have handled more than 6 million interactions in under two quarters, according to the results release. Zinman said the company recently launched Harmony, a voice AI agent platform for enterprise sales teams.

Zinman calls small-business churn ‘by design’

“SMB customer additions were lower, and SMB logo churn was higher,” Zinman said. “This is by design, and we expect it to continue.” He said some performance marketing budget is moving to events and field marketing, and that the company is adding sales staff. “We’re not abandoning the self-serve segment downmarket,” he said.

Chief revenue officer Casey George said the small-business segment “is more sensitive to some of the macro conditions in the economy”. Net dollar retention was 108% across all customers and 114% in the larger-account group. Zinman said sales cycles are longer “as customers take a closer look at how AI fits into their business”.

Headcount falls by 690 in one quarter

The restructuring dates from 22 July, when monday.com said in a filing with the US Securities and Exchange Commission that it would cut about 20% of its workforce to support a “leaner, more focused operating model”. Chief financial officer Eliran Glazer said headcount stood at 2,479 at the end of September, 690 lower than a quarter earlier. Third-quarter restructuring charges were $10m.

Glazer said savings of about $100m would be reinvested, part of it in hiring for the services function in 2027. Zinman described monday Frontier as “a new service organization built to help customers transform their business with AI”, staffed by forward-deployed engineers. George said the company has “a little bit of a RIF hangover”, using the abbreviation for a reduction in force.

monday.com’s European headquarters is in Fitzrovia, London, where it leased an 80,000 sq ft office in 2024. UKTN reported at the time that the site houses the company’s largest research and development operation outside Tel Aviv. The July filing gave no breakdown of the reduction by office.

monday.com expects fourth-quarter revenue of $380m–$382m, growth of about 14%, and a non-GAAP operating margin of about 18%. The third-quarter margin was 24%. The shares fell 7.26% to $81.55 in premarket trading on the day of the results, Investing.com reported. Asked by Arjun Bhatia of William Blair how long the transformation would take, Glazer said “it is not a change that will happen in a quarter. We are looking at that to continue into 2027.”