Driven by its latest financial results and guidance that significantly surpassed market expectations, shares of database platform leader MongoDB Inc. (MDB.US) surged sharply in after-hours trading on Thursday. This performance not only indicates robust enterprise demand but also further suggests that market concerns about artificial intelligence (AI) disrupting the software industry are subsiding.
For the first quarter of fiscal year 2027 (ended April 30), MongoDB reported adjusted earnings per share of $1.32, significantly exceeding the analyst consensus estimate of $1.19 and representing a 32% increase from $1.00 in the same period last year. Revenue for the quarter grew 25% year-over-year to $687.6 million, also notably surpassing market expectations of approximately $665 million.
More encouraging for the market was MongoDB's forward-looking guidance. The company forecasts second-quarter adjusted earnings per share between $1.58 and $1.61, with revenue projected in the range of $729 million to $734 million. The midpoints of both guidance ranges are well above analyst estimates of $1.29 per share and $701 million in revenue. Concurrently, MongoDB raised its full-year outlook. The company increased its full-year adjusted earnings per share guidance from a prior range of $5.75-$5.93 to $5.95-$6.14. The full-year revenue guidance was raised from $2.86-$2.90 billion to $2.92-$2.96 billion, exceeding the previous market consensus of $5.92 per share and $2.9 billion in revenue.
Buoyed by these results, MongoDB's stock price soared over 25% at one point in Thursday's after-hours session. During the regular trading day, the stock had already climbed nearly 11%, closing at $325.68. Since hitting a recent low of $215.68 on April 10, the stock has rallied more than 50%, although it remains down approximately 22% year-to-date.
The company attributed its strong performance and raised guidance to robust demand for its multi-cloud database service, Atlas. Financial reports show Atlas revenue grew 29% year-over-year for the quarter, maintaining a steady growth pace. Notably, AI-related business is emerging as a new growth driver. During the subsequent earnings conference call, management revealed that while large clients in traditional sectors like finance, technology, and media remain primary growth contributors, AI-related business is gaining momentum. Chief Financial Officer Michael Berry noted that early AI deployments and business from cutting-edge AI labs and AI-native companies constitute a "small but accelerating growth driver." Chief Executive Officer Chintan Desai emphasized that enterprises are putting agentic AI applications into production "and choosing MongoDB as the data platform to power those applications." Desai stated, "Our field teams continue to perform exceptionally well and are capturing strong end-user demand for the MongoDB platform across enterprise use cases and emerging AI opportunities." He further added that the recent expansion of the leadership team in product and sales enables the company to move faster and expressed confidence in its ability to drive durable, long-term growth.
MongoDB's impressive quarterly report is part of a broader recovery wave in the software sector. Recently, peers such as Snowflake (SNOW.US) and Datadog (DDOG.US) have also reported strong earnings. After a prolonged sell-off fueled by fears of AI disruption, software stocks are showing clear signs of recovery. The iShares Expanded Tech-Software Sector ETF (IGV.US), which tracks the software sector, has rebounded 28% since April 10, reaching its highest level since January, though it is still down 10% year-to-date.
Barclays analyst Raimo Lenschow pointed out in a client note that while Atlas revenue growth did not accelerate as it did for Snowflake or Datadog, the raised full-year revenue guidance makes this quarterly report a "very credible" start to the company's new fiscal year. He deemed the results "very solid," sufficient to drive the stock higher, and maintained an "Overweight" rating on MongoDB.
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