MongoDB MDB is building a durable revenue foundation through its subscription-based business model, supported by growing Atlas consumption and Enterprise Advanced (EA) adoption. In the second quarter of fiscal 2027, subscription revenues increased 31% year over year to $747.1 million, accounting for nearly 97% of total revenues of $771.8 million.
Atlas remains the primary growth engine, with revenues increasing approximately 29% year over year for the fifth consecutive quarter, driven by strong enterprise consumption. MongoDB's net annual recurring revenue (ARR) expansion rate improved to 122% from 119% a year earlier. Nearly 3,000 customers generated at least $100,000 in ARR, representing 17% year-over-year growth.
Meanwhile, EA and Other subscription revenues increased 36% year over year, supported by strong demand across financial services, technology and the public sector. EA and Other ARR grew 11%, marking the third consecutive quarter of double-digit growth. Subscription gross margin improved to 78.3%, benefiting from a higher EA revenue mix. Remaining performance obligations also surged 91% to $1.52 billion, strengthening future revenue visibility.
However, fluctuating Atlas consumption, quarter-to-quarter changes in usage and unpredictable multiyear EA contract timing could create revenue volatility. Competition and customer spending optimization remain additional challenges.
Nevertheless, expanding enterprise adoption, steady Atlas consumption and growing EA contributions reinforce MongoDB's subscription-driven business model, providing a solid foundation for sustainable revenue growth.
How Are MongoDB’s Database Rivals Challenging Its Growth?
Amazon AMZN competes with MongoDB through AWS DocumentDB and DynamoDB, which provide managed database services for scalable enterprise applications. Amazon DocumentDB supports MongoDB-compatible APIs, offering an alternative for businesses already operating within the AWS ecosystem. Amazon also benefits from its extensive cloud infrastructure and integrated services, potentially challenging MongoDB's Atlas adoption and consumption-based subscription growth.
Oracle ORCL competes with MongoDB through its enterprise database portfolio and cloud offerings. Oracle AI Database 26ai combines relational and JSON data management with native vector search, supporting transactional and AI-driven applications. Oracle's established enterprise relationships and integrated cloud infrastructure strengthen its competitive position, potentially challenging MongoDB's subscription revenue expansion and penetration of mission-critical enterprise workloads.
MDB’s Share Price Performance, Valuation & Estimates
Shares of MDB have declined 12.8% year to date, significantly underperforming the broader Zacks Computer and Technology sector's 17% growth.
MDB’s YTD Price Performance
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From a valuation standpoint, MDB stock is currently trading at a forward 12-month Price/Sales ratio of 8.58X compared with the Internet – Software industry’s 4.23X. MDB has a Value Score of F.
MDB’s Valuation
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The Zacks Consensus Estimate projects 2026 earnings of $6.50 per share, representing a substantial 30.78% year-over-year growth. The earnings estimates have been revised upward over the past 30 and 60 days.
Image Source: Zacks Investment Research
MongoDB currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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