Monday.com Shares Drop as Investors Grow Cautious on HR Tech

Investor anxiety over AI-driven work platforms deepens as growth fails to calm market fears

The turbulence in the HR technology sector is intensifying. Monday.com, a leading work management and productivity platform, delivered better-than-expected fourth-quarter results for 2025, reporting adjusted earnings of $1.04 per share and revenue of nearly $334 million, up sharply from a year earlier. Yet despite beating forecasts for four consecutive quarters, the company’s stock has fallen more than 33% since the start of the year.

The sharp decline signals a broader market reassessment of HR and SaaS platforms closely tied to AI-powered productivity tools. Investors appear concerned not about current performance, but about future demand and rising customer acquisition costs.

During the company’s earnings call, Co-CEO Roy Mann acknowledged ongoing challenges. “No-touch channels continue to operate in a choppy demand environment,” he said, noting that attracting and expanding smaller, self-serve customers has become more expensive and less profitable.

The pressure is not limited to one company. Workday, another major HR software provider, recently announced layoffs affecting 2% of its workforce and has seen its stock decline significantly over the past year. The company is also facing legal scrutiny related to AI hiring practices, allegations it denies.

Experts suggest the situation reflects a wider debate around a possible “AI bubble.” Randy Goebel, a computing science professor at the University of Alberta, warns that investor enthusiasm may be outpacing practical value. For HR leaders, the message is clear: adopt AI carefully, focus on measurable outcomes, and avoid overcommitting in an overheated market.