MongoDB boosts outlook on strong earnings and revenue momentum and its stock jumps

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Document database company MongoDB Inc. bumped up its full-year guidance for the second time this year after its second-quarter sales crushed Wall Street’s expectations, sending the company’s stock sky-high in extended trading.

The company reported earnings before certain costs such as stock compensation of exactly $1 per share, easily surpassing the Street’s forecast of just 66 cents. Meanwhile, it clocked in an impressive $591.4 million in sales during the quarter, up 24% from a year ago and trouncing the analyst consensus estimate of $478.1 million by a huge margin.

The strong results helped MongoDB edge closer to profitability, and it trimmed its net loss to $47 million in the quarter, down from a loss of $54.5 million in the year-ago period.

There were further positive numbers on show too. For instance, MongoDB reported subscription revenue of $572.4 million, up 23% from a year earlier, while services revenue came to $19 million, up 33%. During the quarter, it added more than 2,800 new customers, bringing its total client base to more than 59,900 as of July 31.

MongoDB is the creator of the document-oriented MongoDB database, which is used to power data-intensive applications. Its flagship product is the cloud-hosted MongoDB Atlas, which now accounts for the bulk of its revenue and continues to grow, though it also sells on-premises and mobile versions. All three are popular with developers thanks to their support for multiple data formats and ease of use.

Chief Executive Dev Ittycheria (pictured) hailed the company’s results, saying it delivered strong numbers across the board. “[This is] highlighted by Atlas revenue growth accelerating to 29%,” he said. “We also delivered meaningful margin outperformance as we executed on our plan to drive profitable growth.”

Holger Mueller of Constellation Research Inc. told SiliconANGLE that Atlas is the gift that keeps on giving for MongoDB, adding a record-breaking 5,000-odd new customers during the quarter. “This shows how attractive cloud databases are for enterprises that want to reduce complexity,” he said.

The analyst also praised MongoDB’s ongoing efforts to improve its profitability. “But perhaps it can do more, because at the current pace it’s probably still five-to-seven quarters away from driving a profit,” Mueller added. “It remains to be seen if MongoDB’s investors will be happy with that.”

The company said it’s now looking for full-year revenue of between $2.34 billion and $2.36 billion, up from an earlier range of $2.25 billion to $2.29 billion. In addition, the company raised its annual earnings forecast. Now it’s looking for a profit per share of between $3.64 and $3.73, up from its prior range of $2.94 to $3.12.

This is the second time MongoDB has raised its full-year guidance, after a similar revision three months earlier. Wall Street is eyeing total revenue of around $2.29 billion, and earnings of $3.11 per share.

MongoDB’s combination of solid earnings and revenue beat, explosive growth and strong guidance was well-received by investors. They cheered the company’s momentum, and its stock jumped 29% in extended trading. Update: Shares rose more than 32% in Wednesday trading.

On a conference call with analysts, Ittycheria also highlighted the company’s strong customer growth. He said MongoDB has added more than 5,000 new customers in the first half of the year, representing a new company record. Many of those new customers are using the company’s database to power artificial intelligence applications, he added.

For the current quarter, MongoDB anticipates earnings of around 76 to 79 cents per share on revenue of between $587 million and $592 million. Both numbers are far ahead of Wall Street’s expectations, with analysts targeting earnings of 69 cents on revenue of $581.3 million.

Despite today’s impressive gains after-hours, MongoDB’s stock still has a way to go, for it remains down just over 7% in the year to date.

Photo: SiliconANGLE