MongoDB Stock Drops Despite Surpassing Q3 Earnings Expectations
New York, Wednesday, 11 December 2024.
MongoDB’s stock fell 17% as investors reacted to CFO’s departure and recent stock rally, despite reporting a 22% revenue increase and exceeding earnings forecasts.
Strong Financial Performance
MongoDB (NASDAQ: MDB) reported impressive third-quarter results on December 9, 2024, with revenue reaching $529.4 million, marking a 22% increase year-over-year [1][3]. The company significantly exceeded analyst expectations, posting adjusted earnings of $1.16 per share, well above the projected 67 cents [1]. MongoDB’s cloud service, Atlas, demonstrated robust growth with a 26% year-over-year increase, now representing 68% of total revenue [2].
Market Response and Leadership Changes
Despite the strong performance, MongoDB’s stock fell 17% to close at $290.90 on December 10, 2024 [1]. The decline came amid news of CFO Michael Gordon’s planned departure on January 31, 2025, after nearly a decade with the company [2]. According to William Blair analyst Jason Ader, the sell-off was attributed to both the CFO’s departure and a recent strong stock rally [1]. Serge Tanjga has been named interim CFO starting February 1, 2025, if a permanent replacement is not found [1].
Customer Growth and Future Outlook
MongoDB’s customer base expanded significantly, reaching over 52,600 customers as of October 31, 2024 [3]. The company has provided optimistic guidance for the upcoming quarter, projecting revenue between $515 million and $519 million, surpassing analyst expectations of $509 million [1]. CEO Dev Ittycheria emphasized the company’s position in AI development, stating, ‘MongoDB is in a great position to be a central pillar of the emerging AI tech stack’ [3].
Strategic Shifts and Market Position
The company is strategically reallocating resources to focus on enterprise growth, potentially leading to slower direct sales customer growth in the mid-market segment [5]. MongoDB maintains strong partnerships with major cloud providers, particularly with AWS and Azure [2]. The company’s gross profit reached $405.7 million in Q3, maintaining a healthy gross margin of 77% [2], demonstrating its robust market position despite recent stock volatility.