monday.com (NASDAQ:MNDY) shares plunged about 18% premarket Monday despite delivering a Q2 beat on both revenue and profit. The work management software maker posted $299 million in revenue, up 27% year-over-year, and non-GAAP EPS of $1.09, up 16% both topping analyst expectations.
Co-Founders Roy Mann and Eran Zinman called it another strong quarter with growing demand from enterprise customers. Net dollar retention came in at 111%, and 117% for customers spending over $100,000 in ARR.
Still, Citi’s Steven Enders said the company’s guidance came in more cautious than hoped. Management nudged its 2025 revenue outlook to $1.224 billion$1.229 billion from $1.220 billion$1.226 billion, EBIT to $154 million$158 million from $144 million$150 million, and free cash flow to $320 million$326 million from $310 million$316 million. Analysts noted the bump was smaller than the Q2 beat and likely conservative.
For Q3, revenue is expected at $311 million$313 million, roughly in line with consensus. Investors appear to be reacting to the tempered guidance rather than the solid quarter, sending the stock sharply lower.
This article first appeared on GuruFocus.