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MongoDB (MDB) Q2 Loss Narrower Than Expected, Revenues Rise

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MongoDB (MDB - Free Report) incurred second-quarter fiscal 2022 adjusted loss of 24 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 41 cents per share. However, the figure was wider than the loss of 22 cents per share reported in the year-ago quarter.

Revenues of $198.7 million surged 43.7% year over year and also comfortably surpassed the consensus mark by 8.9%.

MongoDB’s subscription revenues contributed 96.3% of revenues and totaled $191.4 million, up 44.5% year over year. Moreover, services revenues grew 26.9% year over year to $7.4 million, representing 3.7% of revenues.

MongoDB, Inc. Price, Consensus and EPS Surprise

MongoDB, Inc. Price, Consensus and EPS Surprise

MongoDB, Inc. price-consensus-eps-surprise-chart | MongoDB, Inc. Quote

User Base Jumps

MongoDB added 2,200 customers sequentially to reach 29,000 at the end of the quarter under review. Of this, more than 3,600 were direct-sales customers.

The company’s Atlas revenues soared 83% year over year, representing 56% of total revenues. Atlas had more than 27,500 customers at the end of the reported quarter, adding 2,200 customers sequentially.

The company ended the quarter with 1,126 customers, with at least $100,000 in ARR and annualized MRR, compared with 819 in the year-ago quarter.

Non-GAAP Operating Details

In the reported quarter, gross margin contracted 20 basis points (bps) on a year-over-year basis to 71.9%.

Research and development (R&D) expenses climbed 37% to $46.2 million. Sales and marketing (S&M) expenses increased 43.3% to $87.5 million. Moreover, general and administrative (G&A) expenses increased 37.6% to $20.7 million.

As a percentage of revenues, R&D expenses contracted 110 bps to 23.2%. G&A expenses declined 50 bps to 10.4%. As a percentage of revenues, S&M expenses decreased 10 bps on a year-over-year basis to 44%.

Loss from operations widened to $11.5 million from the year-ago quarter loss of $10.2 million.

Balance Sheet & Cash Flow

As of Jul 31, 2021, MongoDB had $1.8 billion in cash, cash equivalents, and short-term investments compared with $935.6 million as of Apr 30, 2021.

During the three months ended Jul 31, 2021, MongoDB used $19.8 million of cash in operations, $1.7 million of cash in capital expenditures, and $1.2 million of cash in principal repayments of finance leases, leading to a negative free cash flow of $22.7 million, compared with a negative free cash flow of $15.0 million in the year-ago period.

Key Q2 Highlights

During the reported quarter, the company launched a number of significant product enhancements including the general availability of MongoDB 5.0 with native time series support and a preview of serverless databases in MongoDB Atlas at a two-day developer event, MongoDB.live.

MangoDB continued the evolution of its industry-leading application data platform with enhancements to Atlas Search, Atlas Data Lake, and Realm, MongoDB's end-to-end mobile data solution.

Guidance

For third-quarter fiscal 2022, MongoDB expects revenues between $202 million and $204 million.

Non-GAAP loss from operations is anticipated to be in the range of $23-$25 million. Non-GAAP net loss per share is estimated between 39 cents and 42 cents per share.

For fiscal 2022, MongoDB expects revenues between $805 million and $811 million.

Non-GAAP loss from operations is estimated to be in the range of $62-$67 million. Non-GAAP net loss per share is expected between $1.13 and $1.20 per share.

Zacks Rank & Stocks to Consider

Currently, MangoDB carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology sector include Microsoft (MSFT - Free Report) , Cadence Design Systems (CDNS - Free Report) , and Texas Instruments (TXN - Free Report) , all carrying a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The long-term earnings growth rate for Microsoft, Cadence Design, and Texas Instruments is currently pegged at 11.09%, 11.68%, and 9.33%, respectively.