MongoDB has elevated its full-year outlook and has announced fiscal third-quarter results that surpassed expectations. Nonetheless, the database software company anticipates a slowdown in consumption for its Atlas cloud platform for the quarter currently in progress, resulting in a drop in its shares early Tuesday. The adjusted earnings are now projected to be between $3.01 and $3.03 per share for fiscal 2025, a significant increase from the earlier guidance that ranged from $2.33 to $2.47.
The revenue forecast is set between $1.97 billion and $1.98 billion compared to prior estimates of $1.92 billion to $1.93 billion. The consensus on FactSet anticipates a non-GAAP EPS of $2.82 and revenue of $1.96 billion. The growth in consumption for MongoDB's cloud-based developer data platform, Atlas, is expected to experience a "typical seasonal slowdown" in the fourth quarter, attributed to moderating application usage during the holiday season.
Chief Financial Officer Michael Gordon indicated during an earnings call, "Since Atlas consumption remained lower on a year-over-year basis in the third quarter, we expect to see continued deceleration of Atlas year-over-year growth in the fourth quarter." Shares of the company saw an increase of nearly 2% at the close of trading on Monday but fell 2.9% during premarket activity on Tuesday. Projected adjusted EPS for the ongoing quarter is estimated to land between $0.62 and $0.65, with revenue anticipated to be in the range of $515 million to $519 million.
Wall Street is currently projecting a non-GAAP EPS of $0.63 along with a revenue of $516.7 million. Gordon noted, "We expect to see a sequential decline in non-Atlas revenue in the fourth quarter, which is contrary to our normal pattern. The reason for this is that we experienced a significant additional benefit from multi-year deals in the third quarter, which we do not expect to recur in the fourth quarter." For the three-month period ending in October, MongoDB reported an adjusted EPS rose to $1.16 compared to $0.96 during the same timeframe last year, exceeding the Street’s estimated figure of $0.69.
Revenue surged 22% year over year to $529.4 million, outperforming analysts' $497.2 million estimate. Subscription revenue saw a 22% increase, reaching $512.2 million, while services experienced an 18% growth to reach $17.2 million. The Atlas platform grew 26% year over year and now accounts for 68% of total revenue, up from 66% in the third quarter of fiscal 2024.
The overall customer base expanded to over 52,600 by the end of October, compared to more than 50,700 at the end of July. In a notable leadership transition, Gordon is set to step down from his dual roles as CFO and chief operating officer at the end of fiscal year 2025. MongoDB has initiated a search for a new CFO and will consider both internal and external candidates.
Serge Tanjga, Senior Vice President of Finance, will serve as interim CFO starting February 1 if a successor to Gordon has not been appointed by that time..