MongoDB (NASDAQ:MDB) continued its incredible run with a strong second-quarter earnings report that, once again, handily beat analyst expectations. Revenue soared 61.5% on the back of even stronger 63% subscription growth.

That's a large acceleration over the previous quarter's 49% overall growth and 53% subscription growth. Maintaining those growth rates would have been impressive, but to accelerate them by 1,000 basis points is truly remarkable.

Some other eye-popping numbers: The net expansion rate, which measures increased spending by existing customers, was over 120% for the 14th consecutive quarter. Total customers increased by over 1,000 in the quarter, to over 7,400, which is up 72% from the previous year. Revenue for the company's newer Atlas product -- a database-as-a-service offering -- saw a 400% year-over-year increase. Atlas now makes up 18% of the company's revenue versus 14% last quarter and 5% a year ago.

With numbers like that, it's no wonder MongoDB stock has more than tripled since its IPO less than one year ago. But is the stock's run sustainable? 

A man in a suit rides a white arrow up to a blue sky.

How high can MongoDB go? Image source: Getty Images.

Shiny new toys for developers

For those new to MongoDB, the first thing to know is that the MongoDB database is built upon a different technological architecture (document-based) than the traditional relational database (row-and-column). The document-based standard has become very attractive to developers because it allows them to create applications more quickly and easily than before.

MongoDB continued that developer-friendly ethos last quarter with the introduction of the "Stitch" feature on the new MongoDB 4.0 software. Stitch allows for "serverless" applications, which enable developers to build value-added code without also having to write a lot of tedious back-end code for an application server. Traditionally, an application would have to reside inside a server in a data center somewhere, so querying a database with an application formerly needed to go through that intermediate step. With Stitch, however, the application server isn't needed and the application code can be utilized by a client directly with the MongoDB database. 

In today's faster-and-faster-paced world, speed is paramount, and CEO Dev Ittycheria says the Stitch feature will act as a "lubricant" for developers to build applications more quickly.

Customer wins

Features like Stitch, as well as so-called ACID compliance, are leading to more and more big customer wins for the company. On its conference call with analysts, MongoDB identified a wide slew of new customers, ranging from cryptocurrency exchange Coinbase to a major international bank to a healthcare analytics company to a leading flower-delivery service.

Citing new customer Royal Caribbean, management said: "One of the exciting aspects of this win is that it was driven by the e-commerce team inside Royal Caribbean's marketing organization, who, within three months, went from having zero MongoDB experience to launching a mission-critical application on Atlas." While just one example, Royal Caribbean's use case certainly gives investors a snapshot of the sea change going on in the database market right now.

Investing to capitalize

Of course, MongoDB still is unprofitable, posting an operating loss of $21.6 million in the quarter, but that's due to the company pushing hard to seize this current opportunity. Ittycheria added, "close to my four-year anniversary, I would say the antipathy towards the legacy vendors has never been higher."

In that light, MongoDB should (and is) spending all it can to win over new customers and the existing customers of legacy databases. Databases are very "sticky," in that customers really don't want to have to transfer all their data to a new vendor, so as the leading document-based database, MongoDB is correct to invest in that leadership position. 

To that end, the company raised $254 million by issuing a convertible bond in June, helping to increase the company's cash position to $523.2 million.

A growth darling

High-growth software companies have been doing quite well lately, but MongoDB may be the most compelling of the bunch. With a great product, a large market opportunity, as well as the ammunition to take advantage, MongoDB has momentum that should continue for the foreseeable future.

Billy Duberstein owns shares of MongoDB. His clients may own shares of some of the  companies mentioned. The Motley Fool owns shares of and recommends MongoDB. The Motley Fool has a disclosure policy.