Monday.com Cut 20% of Its Staff as Revenue Grew 22%

Monday.com Laid Off One in Five Employees During Its Best Quarter Ever

Monday.com’s Q2 2026 revenue came in at $364.6 million, up 22% year-over-year. Its non-GAAP quarterly operating profit was the highest in the company’s history. Then, in July, it cut roughly 20% of its entire workforce—a reduction that strips out about $100 million in annual costs.

Announcements like this usually come attached to expectations that profits will rise. But the market moved the other way. Monday.com’s stock has fallen about 51% in 2026, trading around $90 in early September—down from a peak of $220 a year earlier.

What the market saw wasn’t the scale of the cuts but where they landed. The jobs eliminated were concentrated in roles without sales quotas—specifically, the teams handling small customers and self-serve channels. Enterprise sales and product teams were spared. Which teams a company keeps and which it erases is a more accurate signal than next quarter’s guidance. Sure enough, the company’s own Q3 growth forecast came in at 16-17%, below the 22% it had just posted.

Same Layoffs, Opposite Market Reactions

Chegg also cut costs. Its Q2 2026 non-GAAP¹ operating expenses fell to $32.3 million—nearly half of what they were a year earlier. That let it post adjusted EBITDA² of $9.05 million even in a quarter when revenue dropped 50.7%. The layoffs behind it were larger in scale: 248 employees in May 2025, then 388 more in October—45% of the workforce that remained. Its stock trades in the $1 range, with a market cap of about $125 million as of late April.

Workday cut people too. Headcount went from 21,070 at the end of January to 20,896 by the end of July, while its non-GAAP operating margin guidance rose from 30% to 31%. CEO Aneel Bhusri said he wants to keep headcount essentially frozen next fiscal year.

All three companies cut people the same way—but where that cutting sits is different. Behind Chegg’s layoffs is a -51% revenue line; behind Workday’s is a still-intact 12-13% growth forecast. The former is a company resizing itself to shrinking revenue; the latter is a company stacking margin on top of revenue that’s still growing. On paper, both are cost cuts. In meaning, they’re opposites.

What saved NCsoft wasn’t layoffs — it was new releases

The domestic case makes this distinction even clearer.

In 2024, NCsoft posted its first annual operating loss since going public — ₩109.2 billion (~$78.5M). It then moved into large-scale restructuring. Headquarters staff, once close to 5,000, fell to 3,100 by February 2025. Roughly 800–900 employees left through voluntary retirement, and another 1,000 or so were transferred to spun-off subsidiaries.

Profits exploded in Q2 2026. Revenue hit ₩770.5 billion (~$554M), up 101% year-on-year; operating profit reached ₩173.9 billion (~$125M), up 1,053%; and the operating margin stood at 23%. 18 months separate the end of the layoffs from the arrival of the profits.

What filled that gap was new releases. Of the ₩343.8 billion (~$247M) in Q2 PC game revenue, a single title — Lineage Classic — accounted for ₩185.5 billion (~$133M). Cutting fixed costs did widen the margin, but it wasn’t the layoffs that doubled revenue.

Layoffs can manufacture profit, but they can’t manufacture revenue. Cutting costs leaves more profit on the same revenue — but that math only holds if revenue stays intact. When revenue itself is collapsing, as with Chegg, the savings don’t turn into profit; they turn into borrowed time.

South Korea’s Banking Sector Is Entering the Third Category

Right now, the sector cutting staff on the largest scale in Korea is banking. As of reporting in June 2026, voluntary retirements at the top 5 banks hit 2,470 — the highest number on record. Domestic branches now total 3,749, down 94 in just one year, and the decline looks even steeper when set against the 4,425 branches at the end of 2020. The age range targeted for voluntary retirement has also dropped as low as people in their 40s.

Now AI is entering the picture. KB Financial Group, one of Korea’s largest banking groups, is pushing ahead with a plan to deploy some 300 AI agents across 59 key business areas group-wide. If past headcount cuts were concentrated in branch counters and simple clerical roles being consolidated away, the outlook now is that the scope will widen to specialized headquarters functions like asset management, loan underwriting, and strategic planning.

This follows the same pattern as monday.com. Here, location matters more than scale as a signal. Cutting tellers at branch counters and cutting staff in headquarters underwriting units mean the company is giving up on different things. The former is about closing a channel; the latter is a decision to hand judgment itself over to a machine.

There’s one more thing worth flagging. The recent earnings of Korean companies that announced a swing to profitability also mostly mix in cost-side factors. Wanted Lab, a Korean recruiting platform, posted 2Q26 revenue of ₩11.7 billion (~$8.7M), up 32% from the prior quarter, and turned profitable — but the reporting attributed this to a combination of hiring-market recovery, growth in AI training programs, and an improved cost structure. Kmong, a Korean freelance marketplace, similarly swung to a consolidated 2025 operating profit of ₩3.8 billion (~$2.8M), a result driven jointly by B2B growth and management efficiency gains. And yet, when these stories get reported, they’re usually reduced to one line: the result of an AI transition.

Three Things to Check When Reading an Earnings Report

Putting these cases together narrows down what to look for in a layoff announcement to three items.

First, check whether the revenue outlook went up or down after the layoffs. monday.com had just posted 22% growth, then lowered its guidance for the next quarter to 16–17%. If a company cuts costs and lowers its revenue plan at the same time, that’s not efficiency — it’s winding down part of the business.

Second, check which roles were cut and which were kept. What’s kept tells you the direction the company has decided to go. monday.com kept enterprise, and the bank cut branch staff before headquarters staff.

Third, check where the savings went. monday.com said it would put a substantial portion of its $100 million back into AI and product; Workday redirected it to margins; Chegg used it to preserve cash. Same amount saved, but this is where the divergence in what each company plans to do next shows up.

There’s also the opposite direction. Duolingo’s Q2 2026 revenue grew 18.3%, but earnings per share fell from $0.91 to $0.66. That’s the result of deliberately spending more to acquire users. The market punished this choice too, but at least the numbers make clear what the company is trying to do.

Oswarld’s Lens

This piece started from a suspicion: that most of this earnings season’s profits came from headcount cuts. I checked, and for the most part, that suspicion was right. But that doesn’t necessarily mean it’s a bad sign — where the cuts landed told me far more than whether cuts happened at all.

Even in consulting, when I’m working on organizational design, the material I trust most is what’s left on the org chart. Plenty of documents declare what a company plans to do, but none spell out what it’s decided not to do. That decision only shows up in the empty space where a team used to be. When monday.com erased its small-business customer organization and kept its enterprise organization intact, the company announced a strategy without holding a strategy announcement.

So when I read layoff news, I don’t look at the headcount first. I look at what the people who were cut used to do.

This is also why the language Korean companies are using right now bothers me. Explaining a layoff as “efficiency gains from AI adoption” ties cause and effect together in one neat sentence — but the actual cause is often something else entirely. monday.com’s cuts didn’t happen because AI took over the work — they happened because the small-business segment wasn’t performing. Once you write down “AI” as the cause, nobody has to examine why that business was lost in the first place.

I’ll leave one thing open. Every case discussed so far is a reaction measured within a quarter or two of the cuts. Whether a company like Workday can keep growing with a frozen headcount hasn’t been proven yet, and whether the cash Chegg has left over can build a new business is still an open question. Right now, all we can point to is a direction.

Closing

To sum up: layoffs change margins, but they don’t change the direction of revenue. That direction is already written into what the company chose to keep, and the reorganization notice usually says so before the press release does. Next time you see layoff news in an earnings report, try placing the headcount number next to the revenue outlook and what’s left of the org chart.

There’s probably a team in your own organization, Reader, that has disappeared in the last few years. If the work that team used to do hasn’t landed on anyone else’s desk, the company has decided to stop doing that work.

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💬 Has a team or role disappeared recently at your company or in your industry? Let us know in the comments where that work ended up.

📨 If someone around you is drawing up a reorg or headcount plan, send them this piece. Deciding where before deciding how much is the right order of operations.

References & Further Reading

Primary sources

• monday.com, “monday.com Announces Second Quarter 2026 Results”, August 2026. ··· Lets you compare revenue growth against next-quarter guidance within a single document
• Investing.com, “monday.com Q2 2026 Earnings Call Transcript”, August 2026. ··· Management walks through which roles were cut and where the savings are being reinvested
• Chegg, “Chegg Reports First Quarter 2026 Earnings”, May 6, 2026. ··· The primary-source numbers behind how profit margins held up in a quarter when revenue was cut in half
• CNBC, “Workday’s Q1 Earnings and Headcount Plans”, May 21, 2026. ··· Covers the hiring-freeze comments alongside the upward revision to margin guidance
• Korea Economic Daily, “NCsoft’s First Loss Since Listing and Major Restructuring”, February 12, 2025. ··· Lays out, in hard numbers, how headquarters staff shrank from 5,000 to 3,100
• ZDNet Korea, “NCsoft’s Q2 Operating Profit Jumps 1,053%”, August 11, 2026. ··· Identifies which single game actually drove the profit surge
• Newsway, “Younger Bankers Amid a Wave of Voluntary Retirements: How AI Is Reshaping the Financial Sector’s Workforce Divide”, June 24, 2026. ··· Covers the scale of voluntary retirement programs — known in Korea as huimang toejik, or “hoped-for retirement,” a common euphemism for buyout-based layoffs — at the five major banks, alongside their AI-agent rollout plans
• Venture Square, “Recruitment Rebounds, AX Revenue Adds In: Wanted Lab’s Q2”, August 2026. ··· A rare piece of reporting that doesn’t pin the swing to profitability on a single cause

Background

• Platum, “Kmong Turns Profitable Across Both Consolidated and Standalone Operating Income in 2025”, February 11, 2026. ··· A case where B2B growth and efficiency gains worked together
• Duolingo, “Q2 2026 Shareholder Letter”, August 5, 2026. ··· Shows, in hard numbers, what it looks like to choose investment over near-term profit

Related Past Issues

• People Who Get Laid Off Share a Common Trait (Issue 145)
• Is 92% Productivity Real Performance, or Just Acting? (Issue 223)

The author is Oswarld (Kwangseob Ahn). Current roles: Adjunct Professor at Sejong University, Strategy Consultant at INLEVEL9. Career, research, books, and recent work are kept current on the About page. Latest · July 2026: HEMA-2: A Consolidation-Aware Tri-Memory Architecture with Multi-Channel Scheduling for Lifelong Conversational AI.

📝 Glossary

Footnotes

1. Non-GAAP: Results calculated by excluding items like stock-based compensation or acquisition-related amortization — non-cash or one-time items. Because each company sets its own criteria, the scope varies from firm to firm. ↩

2. Adjusted EBITDA: Earnings before interest, taxes, depreciation, and amortization, further adjusted for one-time items. It approximates operating cash flow but differs from net income — and it’s also the metric where cost cuts like layoffs show up fastest. ↩