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01/11 11:09
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call indicates strong financial performance with a 22% revenue increase, significant Atlas growth, and improved operating margins. The share repurchase program is a positive catalyst. Although there are concerns about non-Atlas revenue decline and potential headwinds, the optimistic guidance and strategic focus on AI and customer growth mitigate these. The Q&A highlights confidence in Atlas growth and strategic initiatives, despite some vague responses. Overall, the positive financial metrics and shareholder return plan suggest a positive stock price movement.
Revenue $549 million, a 22% year-over-year increase, driven by strong performance in Atlas revenue which grew 26% year-over-year.
Atlas Revenue $549 million, representing 72% of total revenue, up from 70% in the previous year.
Non-GAAP Operating Income $87 million, a 16% non-GAAP operating margin, compared to a 7% operating margin in the year-ago period, benefiting from revenue outperformance and slower headcount additions.
Net Income $86 million or $1 per share, compared to $43 million or $0.51 per share in the year-ago period.
Gross Profit $407 million, representing a gross margin of 74%, down from 75% in the year-ago period, primarily due to Atlas growing as a percent of the overall business and the impact of the Voyage acquisition.
Operating Cash Flow $110 million, compared to $64 million in the year-ago period, driven by strong operating profit results and higher cash collections.
Free Cash Flow $106 million, compared to $61 million in the year-ago period, reflecting strong operating profit results.
Customer Growth Total customer count increased to over 57,100, up from over 49,200 in the year-ago period, driven primarily by Atlas.
Net ARR Expansion Rate Approximately 119%, consistent with recent quarters.
Cash and Cash Equivalents $2.5 billion at the end of the quarter.
Voyage AI Acquisition: MongoDB's recent acquisition of Voyage AI enhances its ability to serve the need for high-quality, context-rich unstructured data in AI applications.
Voyage 3.5 Release: The release of Voyage 3.5 significantly improves embedding models while reducing storage costs by over 80%, making it powerful and cost-effective at scale.
Customer Growth: MongoDB added approximately 2,600 new customers in Q1, bringing the total to over 57,100, driven primarily by Atlas.
Enterprise Focus: The company is reallocating resources to focus on the high end of the market, which is expected to fuel growth.
Self-Serve Channel Growth: Strong self-serve customer additions reinforce MongoDB's position as a preferred platform for developers.
Operational Efficiency: MongoDB is sharpening its focus on operating efficiency, regularly reassessing spending and reallocating resources to high conviction areas.
New Leadership: MongoDB hired a new leader for its application modernization program, enhancing its focus on modernizing legacy applications.
Share Repurchase Program: MongoDB announced an increase in its share repurchase program by $800 million, reflecting confidence in long-term business potential.
Market Positioning: MongoDB aims to become the standard platform for enterprises and the default choice for developers building new applications.
Market Risks: The company faces a dynamic and fast-changing macro environment that could impact its operations and financial condition.
Competitive Pressures: MongoDB is positioned against competitors who may be retrofitting their products to meet modern data needs, which could lead to performance bottlenecks and operational challenges.
Regulatory Issues: The company references potential risks and uncertainties related to its operations, which may include regulatory challenges, as indicated in their annual report.
Supply Chain Challenges: There is no specific mention of supply chain challenges in the transcript.
Economic Factors: The company noted some softness in consumption growth due to macroeconomic volatility, indicating that economic factors could affect future performance.
Investment Risks: The company is focused on reallocating resources to high conviction areas, which implies a risk in identifying the right investment opportunities.
Customer Retention: While retention rates are currently strong, any future decline could impact revenue growth.
Non-Atlas Revenue Decline: The company expects a high single-digit decline in non-Atlas subscription revenue, which could affect overall financial performance.
Headwinds from Multiyear License Revenue: An anticipated $50 million headwind from multiyear license revenue is expected to impact the second half of fiscal year '26.
Revenue Growth: Generated revenue of $549 million, a 22% year-over-year increase, above guidance.
Atlas Revenue: Atlas revenue grew 26% year-over-year, representing 72% of total revenue.
Customer Growth: Added approximately 2,600 customers, totaling over 57,100 customers.
AI Integration: Acquisition of Voyage AI enhances capabilities for AI applications, improving accuracy and reliability.
Application Modernization: Focus on modernizing legacy applications with new leadership and tooling.
Share Repurchase Program: Authorized an increase to the share repurchase program by $800 million, totaling $1 billion.
Q2 Revenue Guidance: Expect revenue in the range of $548 million to $553 million.
FY26 Revenue Guidance: Expect revenue in the range of $2.25 billion to $2.29 billion, an increase of $10 million from prior guidance.
Operating Margin Guidance: Raising operating margin guidance to 12% at the midpoint, up from 10%.
Non-Atlas Revenue Expectation: Expect non-Atlas subscription revenue to decline in the high single digits for the year.
Non-GAAP Net Income Guidance: Expect non-GAAP net income per share for FY26 to be in the range of $2.94 to $3.12.
Share Repurchase Program: The Board of Directors has authorized an increase to the share repurchase program, allowing for the repurchase of up to an additional $800 million of common stock. This is in addition to the previously authorized $200 million buyback, bringing the total authorization to $1 billion.
The earnings call highlights strong revenue growth, increased guidance, and a positive outlook for Atlas and non-GAAP operating margins. The company is also making strategic investments in AI and R&D, while maintaining efficiency. Share repurchases and cash flow improvements further enhance shareholder value. Despite risks like Atlas dependency and competitive pressures, the positive financial metrics and guidance outweigh these concerns, indicating a positive stock price reaction.
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