8-K: MongoDB Reports 13% Revenue Growth in Q2 Fiscal 2025, Driven by Strong Atlas Performance

• MongoDB announced its financial results for the second quarter of fiscal year 2025, ending July 31, 2024.
• Total revenue reached $478.1 million, a 13% increase compared to the same quarter last year.
• Subscription revenue was $463.8 million, also up 13% year-over-year, while services revenue decreased by 1% to $14.3 million.
• MongoDB Atlas revenue grew by 27% year-over-year and now accounts for 71% of total revenue.
• The company's customer base expanded to over 50,700 as of July 31, 2024.
• Gross profit was $349.9 million, with a gross margin of 73%, down from 75% in the prior year.
• Non-GAAP gross profit was $360.8 million, with a non-GAAP gross margin of 75%, compared to 78% in the prior year.
• The loss from operations was $71.4 million, compared to a loss of $49.0 million in the same quarter last year.
• Non-GAAP income from operations was $52.5 million, down from $79.1 million year-over-year.
• Net loss was $54.5 million, or $0.74 per share, compared to a net loss of $37.6 million, or $0.53 per share, in the prior year.
• Non-GAAP net income was $59.0 million, or $0.70 per share, compared to $76.7 million, or $0.93 per share, in the prior year.
• MongoDB had $2.3 billion in cash, cash equivalents, short-term investments, and restricted cash as of July 31, 2024.
• The company used $4.0 million of cash in operations, capital expenditures and finance leases, resulting in negative free cash flow, compared to negative free cash flow of $27.3 million in the year-ago period.

Score: 6

Explanation: The document presents mixed results. While revenue growth and Atlas performance are positive, the increase in losses and decrease in profitability metrics temper the overall sentiment. The company is growing but at a cost.

• MongoDB's total revenue increased by 13% year-over-year, reaching $478.1 million.
• MongoDB Atlas revenue saw a significant 27% year-over-year growth, now contributing 71% of total revenue.
• The company's customer base grew to over 50,700.
• Free cash flow improved significantly, moving from negative $27.3 million to negative $4.0 million year-over-year.
• The launch of the MongoDB AI Applications Program (MAAP) provides a comprehensive AI technology stack for customers.
• MongoDB Atlas Vector Search continues to be recognized as a leading vector database.
• The company received multiple partner awards from AWS and Microsoft, highlighting its strong relationships with hyperscalers.

• Gross margin decreased from 75% to 73% year-over-year.
• Loss from operations increased to $71.4 million from $49.0 million in the prior year.
• Non-GAAP income from operations decreased to $52.5 million from $79.1 million year-over-year.
• Net loss increased to $54.5 million, or $0.74 per share, from $37.6 million, or $0.53 per share, in the prior year.
• Non-GAAP net income decreased to $59.0 million, or $0.70 per share, from $76.7 million, or $0.93 per share, in the prior year.

• The company's ability to retain customers and expand their usage of software and services is crucial.
• Ongoing military conflicts and economic downturns could negatively impact the business.
• Failure to meet publicly announced guidance or expectations could affect investor confidence.
• Increased competition in the database market poses a risk to MongoDB's growth.
• The company must effectively manage its growth and recruit and retain qualified personnel.
• The price volatility of MongoDB's common stock is a risk factor.
• The company's history of losses is a risk factor.

MongoDB is providing revenue guidance of $493.0 million to $497.0 million for the third quarter of fiscal 2025 and $1.92 billion to $1.93 billion for the full fiscal year 2025. Non-GAAP income from operations is expected to be between $57.0 million and $60.0 million for Q3 and between $187.0 million and $195.0 million for the full year. Non-GAAP net income per share is projected to be $0.65 to $0.68 for Q3 and $2.33 to $2.47 for the full year.

• Dev Ittycheria, President and Chief Executive Officer of MongoDB, stated that the company delivered healthy second quarter results, highlighted by strong new workload acquisition and better-than-expected Atlas consumption trends.
• He also mentioned that MongoDB is well positioned to help customers incorporate generative AI into their business and modernize their legacy application estate.

The results reflect the ongoing demand for modern database solutions and the increasing adoption of cloud-based services. MongoDB's focus on AI and its partnerships with major cloud providers position it well in the competitive landscape. The company's growth in Atlas revenue indicates a strong shift towards cloud-based database solutions, which is a broader trend in the industry.

• MongoDB's 27% year-over-year growth in Atlas revenue is strong compared to the overall database market growth, which is estimated to be in the mid-teens.
• Competitors like Databricks and Snowflake have also shown strong growth in cloud-based data services, but MongoDB's focus on developer experience and its document-oriented database approach differentiates it.
• The company's customer growth to over 50,700 is a positive sign, indicating a broad adoption of its platform.
• The decrease in gross margin from 75% to 73% is a point of concern, as it suggests increased costs or pricing pressures, which is a common challenge in the cloud services industry.
• The negative free cash flow of $4.0 million, while an improvement, still indicates that the company is not yet generating positive cash flow from its operations, which is typical for growth-stage companies.

• Shareholders may be concerned about the increased losses and decreased profitability, but encouraged by the revenue growth and Atlas performance.
• Employees may be impacted by the company's financial performance and future growth plans.
• Customers will benefit from the continued development of the MongoDB platform and its AI capabilities.
• Suppliers and creditors will be impacted by the company's financial health and ability to meet its obligations.

• MongoDB will host a conference call on August 29, 2024, to discuss the financial results and business outlook.
• The company will continue to focus on expanding its customer base and driving adoption of its Atlas platform.
• MongoDB will continue to invest in its AI capabilities and partnerships with major cloud providers.

• July 31, 2024: End of the second quarter of fiscal year 2025.
• August 29, 2024: Date of the press release announcing Q2 fiscal 2025 financial results and conference call.