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MongoDB (NASDAQ:MDB) Beats Expectations in Strong Q2, Stock Soars


Kayode Omotosho /
2021/09/02 4:08 pm EDT
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Database software company MongoDB (MDB) reported strong growth in the Q2 FY2022 earnings announcement, with revenue up 43.7% year on year to $198.7 million. MongoDB made a GAAP loss of $77.1 million, down on its loss of $64.5 million, in the same quarter last year.

Is now the time to buy MongoDB? Access our full analysis of the earnings results here, it's free.

MongoDB (MDB) Q2 FY2022 Highlights:

  • Revenue: $198.7 million vs analyst estimates of $184.1 million (7.9% beat)
  • EPS (non-GAAP): -$1.22 vs analyst estimates of -$0.40
  • Revenue guidance for Q3 2022 is $203 million at the midpoint, above analyst estimates of $198.2 million
  • The company lifted revenue guidance for the full year, from $777.5 million to $808 million at the midpoint, a 3.92% increase
  • Free cash flow was negative $22.6 million, down from positive free cash flow of $8.39 million in previous quarter
  • Customers: 29,000, up from 26,800 in previous quarter
  • Gross Margin (GAAP): 69.4%, in line with previous quarter

"MongoDB's second quarter results were exceptionally strong across the board, highlighted by Atlas revenue growth of 83%. Our performance reflects the desire of nearly every business to use a modern application data platform that enables them to accelerate the pace of their digital innovation agenda," said Dev Ittycheria, President and Chief Executive Officer of MongoDB.

Started in 2007 by the team behind Google’s ad platform DoubleClick, MongoDB offers database-as-a-service that helps companies store large volumes of semi-structured data.

There are many types of databases and they each have their tradeoffs and can be useful for different purposes, but the overall need to store data has been growing consistently for many years.

Sales Growth

As you can see below, MongoDB's revenue growth has been very strong over the last year, growing from quarterly revenue of $138.2 million, to $198.7 million.

MongoDB Total Revenue

And unsurprisingly, this was another great quarter for MongoDB with revenue up an absolutely stunning 43.7% year on year. On top of that, revenue increased $17 million quarter on quarter, a very strong improvement on the $10.6 million increase in Q1 2022, and a sign of acceleration of growth.

Analysts covering the company are expecting the revenues to grow 27.7% over the next twelve months, although we would expect them to review their estimates once they get to read these results.

There are others doing even better than MongoDB. Founded by ex-Google engineers, a small company making software for banks has been growing revenue 90% year on year and is already up more than 400% since the IPO in December. You can find it on our platform for free.

Customer Growth

You can see below that MongoDB reported 29,000 customers at the end of the quarter, an increase of 2,200 on last quarter. That's in line with the customer growth we have seen over the last couple of quarters, suggesting that the company can maintain its current sales momentum.

MongoDB Customers

Key Takeaways from MongoDB's Q2 Results

Since it has still been burning cash over the last twelve months it is worth keeping an eye on MongoDB’s balance sheet, but we note that with a market capitalization of $25.4 billion and more than $1.81 billion in cash, the company has the capacity to continue to prioritise growth over profitability.

We were impressed by how strongly MongoDB outperformed analysts’ revenue expectations this quarter. And we were also excited to see the really strong revenue growth. Overall, we think this was a really good quarter, that should leave shareholders feeling very positive. The company is up 5.63% on the results and currently trades at $425 per share.

MongoDB may have had a good quarter, so should you invest right now? It is important that you take into account its valuation and business qualities, as well as what happened in the latest quarter. We look at that in our actionable report which you can read here, it's free.

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The author has no position in any of the stocks mentioned.