Israel’s Monday.com lays off 20% of its employees as AI changes how work gets done

Israeli workplace software company Monday.com is cutting as many as 620 employees, or 20 percent of its workforce, as it remodels its strategy and operations to adapt to the era of artificial intelligence and automation.

About 350 employees in Tel Aviv are expected to be affected by the downsizing plan. Monday.com employs about 3,000 people globally, of which about half are located in Tel Aviv. In a letter sent to employees on Wednesday, Monday.com promised to provide those affected with a “generous support package.”

“This is the most painful decision we have made since founding Monday.com — yet we are certain it is the right one. We made it. We own it. And we take full responsibility for it,” Monday.com co-founders Roy Mann and Eran Zinman wrote in a letter to employees. “This decision was not made to reduce costs or replace people with AI.”

“We see internal AI adoption as an accelerator of our growth. This change was made to adapt the company to our new vision of doing the work with AI and not just managing it,” Mann and Zinman said.

The developer of a workplace collaboration and management platform said the layoffs come after months of restructuring to transition to a flatter company with reduced management layers and more autonomous teams as AI transforms the role of software and reshapes the industry.

“We entered a new era where AI is transforming the role of software, creating the greatest opportunity our industry has ever seen,” said Mann and Zinman. “The organization we built for our previous chapter is not the organization that fits the new AI era.”

“Without a fundamental change in how we operate, we will not be able to compete,” they emphasized.

Founded in 2012, Monday.com has built a software platform for users to manage all of their work tasks from one centralized hub, including project management, marketing campaigns and customer and sales management projects.

“Over the past nine months, we have shifted our core vision, moving from managing work to doing the work for our customers, with people and AI agents working together in one workspace,” Mann and Zinman said.

Monday.com went public on the Nasdaq stock exchange in June 2021 at a valuation of about $6.8 billion, the second-highest valuation ever for an Israeli tech firm via an IPO process. The work management software company’s shares have plunged more than 50% since the start of 2026, pushing its market cap down to $3.1 billion.

Monday.com’s move comes as local tech firms, including Wix, Rapyd and Amdocs, embarked in recent weeks on a wave of layoffs to tighten operations, cut costs, and reorganize their staff amid pressure to adapt to the new automation era, and as the strength of the shekel is making operations in Israel more expensive.

“The current wave of layoffs reflects a broader transformation in the technology sector rather than a cyclical slowdown,” said Tal Aspir, head of the AI Lab at the BDO consulting firm. “For years, growth was measured by rapid hiring and expansion.”

“Today, the focus has shifted toward operational efficiency, profitability and the ability to scale through technology rather than headcount, and AI is accelerating this transition,” Aspir added.

Aspir noted that as more companies redesign their operating models around AI and automation, demand for employees with digital, analytical and AI-related capabilities will increase while routine roles, such as basic data entry, first-tier customer support, manual QA testing, and bookkeeping, will continue to shrink.

“As these routine positions rely on predictable, rule-based tasks and repetitive document or ticket processing, they are easily streamlined or fully replaced by AI and automated workflows,” said Aspir. “As a result, human involvement in these traditional functions is rapidly shrinking in favor of higher-level analytical oversight.”