Monday.com's third-quarter results have outperformed Wall Street's estimates, although the project management software provider experienced a downturn in enterprise customer acquisitions in a tumultuous macro environment. For the September quarter, adjusted earnings reached $0.85 per share, an increase from $0.64 the previous year and surpassing the consensus estimate of $0.63 from Capital IQ.
The company's revenue saw a substantial rise of 33%, amounting to $251 million, exceeding analysts' expectations of $246.3 million. The number of paid customers with over $50,000 in annual recurring revenue surged by 40% year-on-year, totaling 2,907 by the end of September. Moreover, the count for clients generating more than $100,000 in annual recurring revenue increased by 44%.
The overall net dollar retention rate stood at an impressive 111%. Despite these positive metrics, the acquisition of pure enterprise customers faced challenges due to slower hiring and sales activities in a sluggish macro environment, as stated by CFO Eliran Glazer during the earnings conference call. Co-CEO Eran Zinman mentioned in a discussion with analysts, "We do see a little bit less customer adds, but that's part of our price increase and product strategy that we focus not just on small and medium businesses but also on large enterprises." In Monday's trading, the firm's US-listed stock experienced a 16% decline. Looking ahead to the full year of 2024, the company anticipates revenue to be in the range of $964 million to $966 million, an increase from its previous projections of $956 million to $961 million.
The market is expecting revenue of $960.3 million, with adjusted operating income projected between $121 million and $123 million, compared to an earlier forecast of $100 million to $105 million. For the current three-month period, Monday.com expects revenue to fall between $260 million and $262 million, indicating annual growth of 28% to 29%.
Analysts predict revenue of $261 million. Glazer remarked, "There are still macro headwinds to a certain extent in some areas of the market. There is some cautious spending environment with many of our customers." Additionally, the company has appointed Adi Dar as the new chief operating officer, taking over from Yoni Osherov, who will resign as chief revenue officer at the end of December.
Dar previously held the position of chief executive at Elbit Systems' electro-optics subsidiary, ELOP. The company is actively seeking a successor to Osherov..