MongoDB's (NASDAQ:MDB) Q1 Sales Top Estimates But Stock Drops 23.4%

Anthony Lee /
2024/05/30 4:15 pm EDT

Database software company MongoDB (MDB) reported Q1 CY2024 results beating Wall Street analysts' expectations, with revenue up 22.3% year on year to $450.6 million. On the other hand, next quarter's revenue guidance of $462 million was less impressive, coming in 2% below analysts' estimates. It made a non-GAAP profit of $0.51 per share, down from its profit of $0.58 per share in the same quarter last year.

Is now the time to buy MongoDB? Find out by accessing our full research report, it's free.

MongoDB (MDB) Q1 CY2024 Highlights:

  • Revenue: $450.6 million vs analyst estimates of $439.9 million (2.4% beat)
  • EPS (non-GAAP): $0.51 vs analyst estimates of $0.37 (36.5% beat)
  • Revenue Guidance for Q2 CY2024 is $462 million at the midpoint, below analyst estimates of $471.5 million
  • The company dropped its revenue guidance for the full year from $1.92 billion to $1.89 billion at the midpoint, a 1.3% decrease
  • Gross Margin (GAAP): 72.8%, down from 73.5% in the same quarter last year
  • Free Cash Flow of $60.98 million, up 20.8% from the previous quarter
  • Customers: 49,200, up from 47,800 in the previous quarter
  • Billings: $413.1 million at quarter end, up 28.8% year on year
  • Market Capitalization: $24.5 billion

"MongoDB's delivered solid first quarter results, highlighted by 32% Atlas revenue growth. At the same time, we had a slower than expected start to the year for both Atlas consumption growth and new workload wins, which will have a downstream impact for the remainder of fiscal 2025," 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.

Data Storage

Data is the lifeblood of the internet and software in general, and the amount of data created is accelerating. As a result, the importance of storing the data in scalable and efficient formats continues to rise, especially as its diversity and associated use cases expand from analyzing simple, structured datasets to high-scale processing of unstructured data such as images, audio, and video.

Sales Growth

As you can see below, MongoDB's revenue growth has been impressive over the last three years, growing from $181.6 million in Q1 2022 to $450.6 million this quarter.

MongoDB Total Revenue

This quarter, MongoDB's quarterly revenue was once again up a very solid 22.3% year on year. However, the company's revenue actually decreased by $7.44 million in Q1 compared to the $25.06 million increase in Q4 CY2023. While we'd like to see revenue increase each quarter, management is guiding for growth to rebound in the next quarter and a one-off fluctuation is usually not concerning.

Next quarter's guidance suggests that MongoDB is expecting revenue to grow 9% year on year to $462 million, slowing down from the 39.6% year-on-year increase it recorded in the same quarter last year. Looking ahead, analysts covering the company were expecting sales to grow 14.5% over the next 12 months before the earnings results announcement.

When a company has more cash than it knows what to do with, buying back its own shares can make a lot of sense–as long as the price is right. Luckily, we’ve found one, a low-priced stock that is gushing free cash flow AND buying back shares. Click here to claim your Special Free Report on a fallen angel growth story that is already recovering from a setback.

Customer Growth

MongoDB reported 49,200 customers at the end of the quarter, an increase of 1,400 from the previous quarter. That's in line with the customer growth we observed last quarter but a bit below what we've typically seen over the last year, suggesting that sales momentum may be slowing a little.

MongoDB Customers

Key Takeaways from MongoDB's Q1 Results

It was good to see MongoDB beat analysts' revenue expectations this quarter. On the other hand, its full-year revenue guidance was dropped and came in below expectations. Its revenue guidance for next quarter also missed Wall Street's estimates. Overall, this was a bad quarter for MongoDB. The company is down 23.4% on the results and currently trades at $237.40 per share.

MongoDB may have had a tough quarter, but does that actually create an opportunity to invest right now? When making that decision, it's important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it's free.