MongoDB (MDB) likely to post a narrower loss in Q3 on Dec 9

MongoDB Inc. (NASDAQ: MDB) is set to report its third-quarter 2020 earnings results on Monday, December 9, after the market close. The bottom line will be hurt by higher costs and expenses but is likely to be narrower than the analysts’ expectations due to growth in the top line.

The sales of subscriptions remained primarily the major contributor to revenue. The company also generates revenue from services, which consist primarily of fees associated with consulting and training services. MongoDB continues to invest in services organizations as this helps to drive customer retention and expansion.

Read: Zscaler Q1 earnings review

The company plans to continue to invest heavily to grow its business to take advantage of the opportunity from the database software market, which is large and growing, rather than optimizing for profitability or cash flow in the near term. MongoDB has made substantial investments in developing its platform and expanding its sales and marketing footprint.

MongoDB has been keen on growing its customer base and continues to invest heavily in the sales and marketing efforts for driving customer acquisition. The company believes that its existing customers are likely to continue their subscriptions due to the economic attractiveness of its subscription-based model.

Analysts expect the company to report a loss of $0.28 per share on revenue of $99.79 million for the third quarter. In comparison, during the previous year quarter, MongoDB posted a loss of $0.30 per share on revenue of $60.25 million. The company has surprised investors by beating analysts’ expectations in all of the past four quarters.

Read: Elastic Q2 earnings review

For the second quarter, MongoDB reported a wider loss due to higher costs and expenses despite a 67% growth in the top line. Subscription revenue rose 71% year-over-year and services revenue grew 15%. MongoDB Atlas’ revenue comprised 37% of total revenue and increased by 240% year-over-year. At quarter-end, the company had over 15,000 customers.

For the third quarter of 2020, MongoDB expects revenue in the range of $98-100 million and adjusted loss per share in the range of $0.29-0.27. For the fiscal year 2020, the company expects revenue in the range of $390-395 million and adjusted loss per share in the range of $1.11-1.06.

We’re on Flipboard! Follow us to receive the latest stock market, earnings, and financial news at your fingertips