Database specialist MongoDB (MDB +3.25%) gave investors plenty to be happy about on Dec. 1 when it delivered a stellar report for its fiscal 2026 third quarter. Share prices of the company are up by more than 23% since that report revealed surging revenue, robust cloud growth, expanding profitability, and an impressive increase in the full-year guidance.
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Several prominent Wall Street analysts, including Hannah Rudolf of Piper Sandler, Mike Cikos of Needham, and Blair Abernethy of Rosenblatt, have also increased their price targets on the stock.
Financial performance and growth catalysts
In MongoDB's fiscal third quarter, which ended Oct. 31, revenue rose 19% year over year to $628.3 million, while non-GAAP net income per share was $1.32, a dramatic improvement from its net loss per share of $1.16 in Q3 2024.
NASDAQ: MDB
Key Data Points
However, the bigger news regarded the growth of MongoDB's fully managed cloud database, Atlas. That segment's revenue soared 30% and now accounts for 75% of overall revenue. After a few quarters of slower expansion, Atlas saw accelerated usage among both self-serve and enterprise customers. Demand for deploying AI-related workloads such as Vector Search and Voyage embeddings on Atlas was also strong, as it has cut latency and operational spend for enterprise clients. This helped tilt MongoDB's sales mix toward higher-margin and recurring revenue streams.
MongoDB's profitability also improved: Non-GAAP operating margin rose 1 percentage point to 20% in the quarter. Free cash flow soared by 300% year over year to $140 million. The company also added 2,600 new customers, exiting the quarter with a customer count of 62,500.
Management now expects fiscal 2026 revenue to land in the range of $2.434 billion to $2.439 billion, up from a prior guidance range of $2.34 billion to $2.36 billion, and non-GAAP operating income of $436.4 million to $440.4 million, up from previous guidance of $321 million to $331 million. Those boosts signal that the company experienced solid demand trends and has clearer revenue visibility, both of which are impressive in the current volatile macroeconomic environment.
