MongoDB delivers a beat&raise Q3 print, but shares slide on call commentary

Investing.com -- MongoDB (NASDAQ:MDB) on Monday reported a better-than-expected quarterly profit and revenue. Shares of the database software maker initially surged in extended trading but later reversed course, declining by roughly 3% after the earnings call.

Revenue for the third quarter ended Oct. 31 rose 22% to $529.4 million, topping analysts' expectations of $497.65 million, while non-GAAP earnings per share (EPS) came in at $1.16, comfortably beating estimates of 67 cents.

“MongoDB's third-quarter results were significantly ahead of expectations on the top and bottom line, driven by better-than-expected EA performance and 26% Atlas (NYSE:ATCO) revenue growth," said Chief Executive Officer, Dev Ittycheria. 

"We continue to see success winning new business due to the superiority of MongoDB's developer data platform in addressing a wide variety of mission-critical use cases"

According to UBS analysts, the strong revenue growth was driven by several large multi-year on-premise deals "with material up-front" revenue recognition.

"Excluding these deals, revs landed just slightly better than expected ($514m versus our $510m estimate)," analysts highlighted. "Combined with language about a more muted-
than-normal 2Q-to-3Q usage improvement, we’re not surprised that the stock is flat/down."

For fiscal 2025, MongoDB raised its guidance, expecting EPS in the range of $3.01 to $3.03, up from $2.33 to $2.47, and above the consensus estimate of $2.48.

Revenue is projected to range between $1.973 billion and $1.977 billion, up from the previous forecast of $1.92 billion to $1.93 billion, and compared to $1.93 billion expected by analysts. 

"We believe results highlight improving execution, which combined with a stronger focus on higher growth potential enterprise customers, an expanding set of core and emerging growth drivers, and growth/ margin accretive investments," Stifel analysts commented.

This, they believe, "should enable Mongo to sustain 20%+ revenue growth and incremental levels of profitability/cash-flow in coming years."

The company also announced that Chief Operating Officer and Chief Financial Officer Michael Gordon will step down at the end of January. Gordon will transition to an advisory role to ensure a smooth handover.

MongoDB has started the search for a new CFO and will consider both internal and external candidates. If a successor is not named by Feb. 1, Serge Tanjga, senior vice president of finance, will take over as interim CFO.

Pratyush Thakur contributed to this report.