MongoDB Beats on Revenue With Smaller Loss on Top 

Database platform innovator MongoDB (NASDAQ: MDB) announced fiscal 2020 third-quarter performance after the market close on Dec. 9.

Revenue of $109.4 million was 52% higher than the same period last year and significantly surpassed the consensus estimate of $97.5 million.

Subscription revenue comprised 95% of the business and increased a robust 56% while services revenue advanced 8%.

The company posted a non-GAAP net loss of $14.6 million, or -$0.26 per share which was a bit narrower loss than the street’s -$0.28 forecast.

This was a wider loss compared to last year’s $6.9 million shortfall. Gross profit margin contracted 400 basis points versus last year to 71%.

President and CEO Dev Ittycheria commented, “MongoDB’s terrific third-quarter results are the latest example of how the powerful combination of our modern data platform and sophisticated go-to-market efforts are driving increased adoption by both new and existing customers.”

The company continued to add to its customer base reaching over 15,900 customers spanning more than 100 countries as of the end of October. The MongoDB database platform has received over 80 million downloads since its initial release a decade ago.

MongoDB is a tech company you want to own. Management continues to grow the business faster than the market expects through targeted R&D and investments in new functionality.

The stock is middle of the pack on multiples while growing revenue faster than average.

Forward Multiple vs Revenue Growth

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A high-quality stock playing off a strong trend in big data.

Buy and hold.

 

Atlas Holding the Weight of the MongoDB World

MongoDB also formed a new partnership with Aliyun, Alibaba’s cloud computing subsidiary that serves the parent company and other online businesses in China.

The MongoDB Atlas offering, the company’s flagship product representing 40% of the business, generated a remarkable 185% year-over-year revenue growth.

The fully-managed cloud database-as-a-service (DaaS) solution gives customers the ability to manage their data deployments on any cloud service provider including Microsoft Azure and Amazon’s AWS.

Atlas has grown into a $175 million-plus run-rate business over the last three years.

Ittycheria continued, “As we look ahead, Atlas’s growing scale provides a tremendous opportunity to develop even closer relationships with our customers and enhance our value proposition. Our focus is to continue delivering new innovations on our data platform, while ensuring our go-to-market efforts make it increasingly easy for customers to consume Atlas.”

MongoDB also formed a new partnership with Aliyun, Alibaba’s cloud computing subsidiary that serves the parent company and other online businesses in China. MongoDB has enjoyed a strong following among developers in the region who with the new alliance can now access the authorized database service for the first time.

 

Strong Outlook Sends Shares Higher

Management also issued upbeat fourth-quarter and full-year guidance. It expects fourth-quarter revenue of $109 million to $111 million and full year fiscal 2020 revenue of $407.2 million to $409.2 million. This represents a considerable improvement over the consensus outlook of $106 million for the fourth quarter and $394 million for the year.

The company’s fourth quarter EPS estimate of -$0.29 to -$0.27 was slightly better than the -$0.30 consensus. It is forecasting a net loss per share of $1.04 to $1.02 which is also better than the -$1.07 that analysts expected.

The stock is reacting positively to the report jumping more than 7% in after-hours trading to $140.75

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