MongoDB reported better-than-expected third-quarter results and provided an outlook for 4Q and fiscal 2021 that topped the Street’s estimates. Meanwhile, shares fell 2.5% in the extended trading on Tuesday as the software company posted a larger 3Q loss compared to the prior year.
MongoDB (MDB) reported a third-quarter loss of $0.31 per share, which came in better than analysts’ expectations of a loss of $0.44 per share. However, it widened from the year-ago quarterly loss of $0.26 per share.
The company’s 3Q revenues jumped 38% to $150.8 million and surpassed the consensus estimates of $138.7 million. Subscription revenues grew 39% year-over-year to $144.1 million, while service revenues grew 19% to $6.7 million.
The company’s CEO Dev Ittycheria said, “COVID-19 has further elevated the importance enterprises are placing on moving quickly to the cloud. With the recent announcement of multi-cloud clusters, MongoDB Atlas is the first cloud database to enable an application to run simultaneously across multiple cloud providers.” He added, “By using MongoDB, customers not only get an easy migration path to the cloud but also the ability to leverage the best capabilities of the major cloud providers and enable true platform independence.”
Looking ahead to 4Q, the company anticipates revenues to be in the range of between $155 million to $157 million, which is above the Street consensus of $146.1 million. Moreover, MongoDB projects a 4Q loss in the range of $0.39 to $0.40 per share, compared to analysts’ expectations of a loss of $0.43 per share.
As for fiscal 2021 (ending in Jan. 2021), the company expects revenues to generate between $574.4 million to $576.4 million, compared to analysts’ projections of $553.4 million. MongoDB expects to post a loss of between $1.04 to $1.07 per share in fiscal 2021, compared to the Street’s estimates for a loss of $1.22 per share. (See MDB stock analysis on TipRanks)
Ahead of the company’s 3Q results, Monness analyst Brian White maintained a Hold rating on the stock. In a research note to investors, the analyst said, “We believe the strong secular demand for next-gen databases remains firmly in place and MongoDB is well positioned to benefit from this trend, delivering another quarter of healthy revenue upside; however, valuation has become less compelling after a sharp rise in the stock this year.”
Meanwhile, the Street has a cautiously optimistic outlook on the stock. The Moderate Buy analyst consensus is based on 4 Buys and 2 Holds. With shares rallying 115% so far this year, the average price target now stands at $295.20 and implies upside potential of about 4.3% to current levels.
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