Casey, former EVP at Qlik, joins monday.com as Chief Revenue Officer. Strong Q1 revenue growth at $282 million, up 30%. Gross margin at 90%. Expecting revenue growth of 24-25% for Q2, 25-26% for full year 2025. Adjusted free cash flow goal of over $1 billion from ’23 to ’26.

monday.com’s success continues with momentum from 2024 into 2025. Confident in strategic initiatives despite macroeconomic uncertainty. NDR stable at 112%. Total employee headcount at 2,695, aiming to grow by 30% in 2025. Adjusted free cash flow of $109.5 million in Q1, on track to meet Investor Day goals.

Excitement as Casey joins monday.com, bringing expertise to accelerate enterprise growth. Q1 financials show solid revenue growth and improving efficiency. Revenue at $282 million, gross margin at 90%. Expecting revenue growth of 24-25% for Q2, 25-26% for full year 2025. Adjusted free cash flow target of over $1 billion by ’26. Casey, with expertise in selling to larger enterprises, joins the team to accelerate the upmarket motion. Q1 performance saw strong net customer adds due to increased performance marketing spend. Momentum remains high across products, with a focus on mid-market and enterprise segments. Net retention expected to stay around 112%.

AI actions adoption is growing exponentially, with customers seeing real business value. Monetization is in early stages, but correlation between usage and pricing is evident. FX impact in Q1 revenue was negative, but the assumption for the year is a less than 1% impact. Guidance remains conservative due to macroeconomic uncertainties.

Success in upmarket motion, especially with work management offering moving up. As work management moves upmarket, other solutions like CRM, service, and dev are also gaining traction. Work management is leading the way, but other solutions are on their own trajectory to enterprise success. The company is excelling in various product categories, with deep features catering to enterprise needs. Different products target distinct customer sizes, such as services for larger clients and CRM for SMBs. Plans include pushing products upmarket as capabilities grow, but uncertainties in the market warrant a cautious approach.

In terms of financial guidance, the company anticipates mid to high-single-digit customer growth year-over-year. Factors like FX impact, NDR slightly below 112%, and no revenue from AI in fiscal year 2025 are considered. A conservative outlook is adopted due to ongoing market uncertainties.

Across enterprise and SMB segments, trends remain consistent from Q1 into April. Strong demand persists in mid-market and SMB, with enterprise showing steady growth. Expansion is driven by both cross-sell and adding new apps, particularly in the monday service realm. Geo-wise, demand is healthy and consistent worldwide.

Expansion in larger customer cohorts continues, with a focus on adding seats rather than cross-selling. While cross-sell is increasing, major expansions stem from account growth within the platform. Linearity in the quarter and healthy demand across all regions are noted, with no significant geographic shifts observed.

Customer additions in dev have shown improvement in the first quarter, signaling positive momentum. The team is making progress with monday dev’s repositioning in the market, resulting in a favorable response from customers. In Q1, monday.com saw strong customer growth driven by performance marketing. Seasonality played a role, but new features and positive customer feedback contributed to progress. The team remains optimistic despite potential uncertainties affecting enterprise sales cycles. Hiring trends are strong, with a focus on enterprise sales reps and R&D to enhance product offerings.

The company plans to grow its headcount by 30% this year, with investments in enterprise sales and R&D. The focus is on upselling and expanding the customer base, aligning with strong return on investment. The use of Multi-Column Property (MCP) opens up new opportunities for customer interaction and platform development, with promising early results.

monday.com’s platform is evolving rapidly, with the MCP feature enabling better interaction and customization. Competition remains steady in the CRM space, with no significant changes in win rates or market dynamics. The company’s customer-centric approach and commitment to innovation continue to drive growth and success. Eliran Glazer, CEO of monday.com, highlights the company’s success in competing with players like Pipedrive, Zoho, SugarCRM, and HubSpot, particularly in the SMB mid-market. The platform’s flexibility and enterprise functionality drive customer preference. The company plans to target larger enterprises in the future as well.

During a Q&A session, analysts inquire about monday.com’s strong cash flow in Q1 and seasonal trends. Eliran Glazer explains that Q1 is typically their strongest quarter due to various factors like bonus payments, hiring results, and salary increases. The company expects this trend to continue throughout the year as per their guidance.

Analysts question Eliran Glazer about Net Dollar Retention (NDR) trends and underlying stability. He notes that price increases contributed 1-2% last year, leading to a more stable trend. The company sees potential for cross-selling monday services to larger enterprises, while CRM and dev products are still maturing for such clients.

Regarding NDR guidance, Eliran Glazer attributes the downtick to recent uncertainty and conservatism due to macroeconomic factors. The company remains cautious about how NDR will evolve throughout the year. This uncertainty is a significant factor impacting their guidance.

In response to concerns about European business growth deceleration, Eliran Glazer acknowledges challenges in the region compared to North America. While Europe’s growth is not as strong, the company is seeing stabilization and progress. Overall, they are pleased with the developments in Europe.

Analysts raise questions about monday.com’s geographic traction, particularly in Europe. Eliran Glazer notes challenges in the region but emphasizes the company’s progress and stabilization efforts. Despite some weaknesses compared to North America, monday.com remains optimistic about their European operations. Eliran Glazer, CFO of a company, addressed stability and growth projections for the mid-20s based on factors like NDR and customer growth. The conservative approach to guidance includes factors such as FX impact and customer expansion rather than growth. Headcount is expected to increase by 30%.

Roy Mann discussed the adoption of AI capabilities, specifically AI blocks, by tech-oriented champions within the customer base. The focus is on understanding use cases and rolling out templates to provide value to more customers. The strategy is to start with early adopters and gradually expand usage.

Eliran Glazer, responding to a question about the Investor Day model, stated that the company is still in the base case scenario based on core performance. There have been no signs of a weakening macro environment, and margins are expected to improve as previously guided. The company continues with a best-case scenario approach.

Eran Zinman discussed the hiring of Casey George as a major accelerator to the company’s enterprise strategy. George’s experience in both large enterprise and smaller companies, as well as managing a large customer base, made him a perfect fit to lead the go-to-market strategy. Partner strategy remains focused on reaching enterprise customers in new geographies and providing technical expertise through professional services. Partnerships are crucial for company growth, with continued investment and focus on industry-specific knowledge. Strategic alliances drive success in the market, emphasizing the importance of collaboration for long-term success.

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Read more at Yahoo Finance: monday.com (MNDY) Q1 2025 Earnings Call Transcript