Why MongoDB Stock Was Soaring Today

What happened

Shares of MongoDB (MDB 3.02%), a maker of database software, were surging today after the company turned in better-than-expected results in its fourth-quarter earnings report.

As of 1:09 p.m. ET on Wednesday, the stock was up 18.1%.

Image source: Getty Images.

So what

Revenue in the quarter jumped 56% to $266.5 million, which was well ahead of estimates at $241.7 million. Revenue from MongoDB Atlas, its cloud-based database software that has driven much of the company's growth in recent years, was up 85% and made up 58% of the company's total revenue.

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NASDAQ: MDB

MongoDB

Today's Change

(-3.02%) $-7.29

Current Price

$233.99

Key Data Points

Market Cap

$19B

Day's Range

$233.45 - $238.51

52wk Range

$140.78 - $444.72

Volume

27K

Avg Vol

1.9M

Gross Margin

71.31%

Customer count in the quarter increased from 24,800 a year ago to 33,000, with essentially all of that growth coming from Atlas. Customers with annualized recurring revenue of more than $100,000 increased from 975 to 1,307, showing that customers are ramping up their spending and it's attracting larger companies.

MongoDB is also seeing strong traction with large cloud infrastructure partners like Microsoft Azure, Alphabet's Google Cloud, and Amazon Web Services, as it said deals sourced by cloud vendors increased by more than 80%.

On the bottom line, its adjusted loss per share narrowed from $0.33 to $0.09, which was ahead of the analyst consensus for a $0.23 loss per share.

Now what

Looking ahead to fiscal 2023, MongoDB expects revenue of $263 million to $267 million for the first quarter, representing 46% growth at the midpoint and ahead of the consensus at $253.4 million. On the bottom line, it forecast a loss between $0.08 and $0.12 per share, compared to Wall Street expectations of a loss of $0.17.

For the full year, it guided for revenue of $1.15 billion to $1.18 billion, equal to 33% growth and in line with analyst estimates. It also forecast an adjusted loss between $0.29 and $0.51 a share, compared to the average estimate for a per-share loss of $0.60.

MongoDB stock is expensive trading at a price-to-sales ratio around 20 based on this year's forecast, but with Atlas sales nearly doubling, the cloud stock deserves a premium.