Monday.com is the latest tech company to blame AI for layoffs — here are 20 others | TechCrunch

Monday.com disclosed on July 22, 2026, via SEC Form 6-K that it is eliminating approximately 630 positions — roughly one in five of its 3,000 employees worldwide — making the Israeli workplace software company the latest entry on a list that now covers at least 21 major tech firms citing AI as justification for mass layoffs in 2026. The restructuring will cost between $45 million and $55 million in charges, according to TechTimes, and represents what co-CEOs Roy Mann and Eran Zinman called "the most painful decision we have made since founding monday.com." It is also, increasingly, the most familiar kind of announcement in enterprise software.

What's Converging

The scale of AI-attributed workforce reductions in 2026 has crossed into statistically notable territory. TechCrunch's running tally of companies that have explicitly cited AI in layoff announcements now lists 21 firms, with cuts at Amazon, Meta, Microsoft, and Oracle alone accounting for roughly 50,000 of an estimated 140,000 U.S. tech job losses so far this year. Separately, outplacement firm Challenger, Gray & Christmas tracked 101,743 U.S. layoff announcements through June in which AI was cited as a contributing factor — approximately 23 percent of every job cut across the entire economy. Layoffs.fyi data cited by TechCrunch's July 22 report puts the AI-blame rate even higher, finding that a record 78 percent of companies have named AI refocus as a reason for letting workers go this year.

The pattern of who goes first is becoming legible. Cloudflare cut 20 percent of its staff and specifically targeted what internal observers described as "measurers" — middle management, finance, legal, and internal audit functions — roles that involve assembling and interpreting information rather than producing it directly. Block went further: founder Jack Dorsey announced a 40 percent workforce reduction and stated publicly that within a year, most companies would reach the same conclusion he had. GitLab framed its 14 percent headcount reduction as the beginning of what it called a "generational rebuild" of infrastructure to support agentic workloads. The common thread is not just cost reduction — it is an architectural claim that human coordination layers can be replaced or dramatically compressed by AI agents operating at scale.

What makes this wave distinctive, and worth watching more carefully, is a Financial Times analysis covering all 21 companies in TechCrunch's list: firms that cited AI when announcing layoffs underperformed the Nasdaq by approximately 10 percent in the 30 days following their announcements. That is not the market rewarding bold AI pivots. It is the market expressing skepticism about whether the narrative being offered maps to actual value creation. Not every company is simply cutting costs — Meta moved roughly 7,000 workers into AI-focused roles while cutting 8,000 others, and IBM replaced 200 HR positions with AI agents while publicly calling the shift a redeployment, not a reduction. But the market's aggregate reaction suggests investors are not yet convinced the arithmetic adds up.

The Specific Development

Monday.com's situation carries a specific and unusually concrete catalyst. In early February 2026, CNBC reporters with no coding background used Anthropic's Claude Code to build a functioning replica of Monday.com's core product in under an hour for less than $15. The demonstration circulated widely in enterprise software circles and accelerated a stock selloff already underway: MNDY shares fell more than 50 percent year-to-date in 2026 and roughly 75 percent from their 52-week high, according to Briefs.co. That context is important because it reframes the "AI-driven growth strategy" framing offered by the co-CEOs. The restructuring is partly a response to an existential commoditization threat, not purely an opportunity-driven pivot.

Co-CEO Eran Zinman published a letter to employees that Business Insider obtained and reported on, in which he wrote that the company had "entered a new era where AI is transforming the role of software, creating the greatest opportunity our industry has ever seen," and that without fundamental operational change, Monday.com would not be able to compete. Multiple sources covering the announcement — TechCrunch, Briefs.co, and TechTimes — all note that the company explicitly stated the cuts are not about replacing workers with AI or reducing costs as a primary goal. Rather, Zinman told employees that nearly all the savings from the layoffs would be redirected into product development, AI infrastructure, and long-term expansion. The company's AI Work Platform, which already includes a no-code app builder, a customizable AI agent, workflow automation tooling, and a report-generating chatbot, is where that investment is headed. TechTimes notes that the co-CEOs pointed to Monday.com's proprietary data infrastructure — internally called mondayDB — as the moat they believe cannot be replicated by a CNBC reporter with a credit card and Claude.

Our read is that the gap between "not a cost-cutting move" and "we expect restructuring charges of up to $55 million" is doing significant rhetorical work here. Whether the reinvestment claims hold is something analysts will be checking against earnings reports over the next two quarters. The briefs.co piece reporting 620 employees affected versus TechTimes and TechCrunch reporting 630 is a minor discrepancy, likely reflecting different cut-off dates for the headcount figure from Monday.com's 2025 annual report, which listed 3,155 total employees.

What's Likely Next

The 30-to-90-day question for Monday.com specifically is whether the AI Work Platform can demonstrate revenue acceleration that the workforce reduction narrative alone has not produced. The co-CEOs raised their operating margin forecast to 15 percent as part of the restructuring announcement, according to TechTimes — that is the number analysts will hold them to. If Q3 results show the AI platform driving net new enterprise contract growth rather than simply reducing the cost base of the existing business, the stock underperformance pattern the FT identified may reverse. If they show the same or shrinking revenue with a leaner cost structure, the market will read it as what it looks like: a company defending its margins against a commoditization threat it could not outrun.

For the broader list of 21 companies, the follow-on question is whether the talent being cut is actually being absorbed productively or simply removed from the market. TechCrunch's primary analysis notes that Anthropic and OpenAI have been actively recruiting from the displaced pool — which is either a healthy signal that AI is creating new roles elsewhere in the ecosystem, or evidence that the companies building the automation tools are consolidating talent away from the companies whose labor they are replacing. Analysts tracking the SaaS sector, which Briefs.co describes using the term "SaaSpocalypse," will be watching whether the enterprise software segment as a whole can stabilize its growth rates by the end of 2026, or whether the commoditization pressure signaled by a $15 Claude Code demo continues to compress multiples across the category.

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