Shares of database software company MongoDB (MDB) jumped 16.5% in the afternoon session after the company reported a "beat and raise" quarter. First quarter results beat analysts' expectations for revenue, gross margin, free cash flow, and earnings per share. Guidance was also strong. Revenue guidance for the next quarter exceeded expectations. The full year guidance was raised and also came in ahead of Consensus. The profitability guidance was similarly impressive as operating income guidance for the next quarter and full year came in ahead. The company touched on the current AI trend noting that "...MongoDB's developer data platform is well positioned to benefit from the next wave of AI applications in the years to come". Overall it was a strong quarter for the company with solid results and impressive guidance.
What is the market telling us:
MongoDB's shares are very volatile and over the last year have had 62 moves greater than 5%. But moves this big are very rare even for MongoDB and that is indicating to us that this news had a significant impact on the market's perception of the business. The previous big move was about one month ago, when the company gained 6.09% on the news that stocks, especially tech names, rebounded after Microsoft and Alphabet reported strong Q1 results, which surpassed top and bottom-line estimates to kickstart the new earnings season. Cloud services continued to be in high demand as Microsoft's cloud unit (Microsoft Azure) reported solid growth despite negative channel feedback and fears of cost optimization by customers, setting a positive tone for other companies in the cloud space. Google Cloud also beat estimates and Search growth was healthy, a good sign for the macro since advertising is a leading indicator.
MongoDB is up 101% since the beginning of the year. Investors who bought $1,000 worth of MongoDB's shares 5 years ago would now be looking at an investment worth $7,930.
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