Morningstar

MongoDB Earnings: Accelerating Revenue Growth Drives Outsize Operating Leverage

We’ve raised our fair value estimate of MongoDB stock.

Logo and signage at the headquarters of document-oriented database company MongoDB in the Silicon Valley town of Palo Alto, California.
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Securities in This Article
MongoDB Inc Class A
(MDB)

Key Morningstar Metrics for MongoDB

What We Thought of MongoDB’s Earnings

MongoDB MDB reported another breakout quarter, with total revenue up 19% and Atlas revenue expanding 30% year over year. On top of the rolling 12-month customer addition approaching 10,000 for the first time, management shared that major customers are “getting bigger and growing for longer.”

Why it matters: We are amazed by MongoDB’s pace of achieving operating leverage. Despite the growth of the fully managed Atlas service dragging gross margin, the company’s non-GAAP operating margin is on track to improve nearly 300 basis points for fiscal 2026.

  • Bottom-up adoption among database engineers provides an effective self-serve marketing motion, freeing MongoDB’s marketing resources for big accounts. We think vector search’s availability in the free community edition should further boost near-term growth potential for customer count.

The bottom line: We raise our fair value estimate for no-moat MongoDB to $303 per share from $244 after integrating higher margin and revenue outlooks. Shares remain overvalued following our fair value adjustment.

  • We think the stock’s 22% after-hours jump rightfully reflects investors’ enthusiasm for MongoDB’s near-term outperformance. However, the current price is charting a perfect growth path well beyond the 2020s, requiring significant AI workload capture.
  • A review of recent DB-Engines ranking trends shows that PostgreSQL’s popularity outweighs MongoDB on both 1-year and 3-year marks, which continues to impair our conviction about the sustainability of MongoDB’s growth in the long term.

Coming up: Management provided a sanguine fourth-quarter outlook; raised full-year revenue outlook by over $100 million to $2.437 billion and earnings per share outlook by over $1.00 to $4.78 at the midpoint.

  • While the company did not offer explicit fiscal 2027 guidance, management expressed confidence in continued strategic investment driven by positive revenue growth for the new fiscal year.

Editor’s Note: This analysis was originally published as a stock note by Morningstar Equity Research.

The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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