Monday.com Joins Growing List of Tech Firms Citing AI in Workforce Restructuring

Monday.com, the Israeli work management software firm, has announced a significant workforce reduction, becoming the latest technology company to frame job cuts within a broader strategic pivot to artificial intelligence. The company stated it will lay off approximately 20% of its staff, or just over 600 employees, as part of a restructuring plan aimed at creating a “leaner, more focused operating model” to support its “AI-driven growth strategy.” This move follows a pattern seen across the tech sector in 2026, where companies are simultaneously announcing layoffs and massive investments in AI infrastructure and development.

Key takeaways

• Monday.com is laying off over 600 employees, citing a strategic shift to an “AI-driven growth strategy” and a need for a leaner operating model, while still projecting up to 20% revenue growth for 2026.
• U.S. tech companies have cut nearly 140,000 jobs since the start of the year, with giants like Amazon, Oracle, Meta, and Microsoft accounting for almost 50,000 of those reductions as they invest hundreds of billions into AI data centers.
• Financial Times analysis reveals that companies citing AI as a factor in layoffs have underperformed the Nasdaq by almost 10% in the 30 trading days following their announcements, suggesting market skepticism.
• Despite widespread cuts, the labor market is shifting rather than collapsing, with AI-focused firms like Anthropic and OpenAI hiring rapidly, and companies like Meta moving thousands of employees into new AI-focused roles.
• Other major tech firms, including Microsoft, Oracle, GitLab, Google, Intuit, Cisco, and Cloudflare, have all announced significant layoffs this year with AI cited as a contributing or enabling factor in their restructuring plans.

The AI Restructuring Wave

The announcement from Monday.com is part of a broader industry trend. According to a Financial Times analysis, U.S. tech companies have slashed nearly 140,000 jobs since the start of 2026. A significant portion of these cuts—almost 50,000—come from tech behemoths Amazon, Oracle, Meta, and Microsoft, all of whom are funneling hundreds of billions of dollars into building out AI data center capacity. Monday.com’s co-founder, Eran Zinman, emphasized in a memo to employees that the layoffs “was not made to reduce costs or replace people with AI,” but rather to adapt the organization to an AI-first vision established about a year ago. The company expects restructuring charges of $45 million to $55 million.

Other companies have made similar moves. Microsoft cut about 4,800 roles, primarily in its Xbox unit, with its CFO noting a year-over-year decline in headcount as the company focuses on “building high-performing teams” amid rising AI investment. Oracle disclosed it reduced its workforce by 21,000 employees over the past 12 months, explicitly linking the reductions to the “adoption and deployment of AI technologies.” GitLab laid off roughly 350 workers to fund AI infrastructure investment, citing “agentic workloads” that are “pushing competitors to the brink.”

Shifting, Not Just Shrinking, Workforces

The narrative is not solely one of job elimination. The FT notes that while some roles are being cut, the tech labor market is undergoing a significant shift. AI-focused companies like Anthropic and OpenAI are on hiring sprees, absorbing talent from elsewhere in the sector. Furthermore, within large companies making cuts, headcount is often being reallocated. Meta provided a prime example earlier this year, laying off about 8,000 employees while simultaneously moving roughly 7,000 others into new AI-focused roles. IBM has also stated it is tripling entry-level hiring for AI and hybrid-cloud roles even as it makes other reductions.

This pattern of restructuring extends across the industry. Intuit announced plans to cut about 3,000 jobs to reduce complexity and reallocate resources toward AI. Cisco is cutting nearly 4,000 jobs to realign resources around “silicon, optics, security and AI,” with its CFO stating the move was not primarily savings-driven. Google has been conducting rolling cuts within its Cloud division through performance reviews and reorganizations, with external estimates suggesting between 1,500 and 3,000+ engineers have been affected in 2026, even as Cloud revenue surges.

Why it matters

The wave of layoffs linked to AI investment highlights a pivotal and painful transition within the technology industry. Companies are aggressively reallocating capital and human resources from established business units toward what they perceive as the foundational technology of the next decade. However, the Financial Times finding that companies citing AI in layoffs underperform the market afterward indicates investor wariness about whether these moves represent genuine strategic pivots or merely convenient narratives for cost-cutting. The simultaneous boom in hiring at pure-play AI firms underscores that demand for AI talent is intense, but the skills required are changing rapidly, leaving many existing tech workers displaced. This restructuring phase will likely define the competitive landscape for years, separating companies that successfully integrate AI from those that struggle to adapt.