MongoDB Stock Slips Pre-Market Despite Q3 Earnings Beat On CFO’s Exit: Retail Holds On

Shares of MongoDB fell as much as 8% in pre-market trading despite reporting strong third-quarter results and raising its full-year outlook on news that the company’s COO and CFO, Michael Gordon, would be stepping down. 

According to an ongoing poll on Stocktwits, most users find the development “very concerning.”

Stocktwits Poll on MongoDB's CFO, COO Exit on Dec 10 as of 7:00 a.m. ET | Source: Stocktwits

The company announced it has initiated a search for a new CFO, considering both internal and external candidates. 

Serge Tanjga, MongoDB's president of finance, will serve as interim CFO starting Feb. 1 if a permanent replacement is not found by then.

The data development, storage, and management platform reported adjusted earnings of $1.16 per share, surpassing analysts' estimates of $0.68. 

Revenue came in at $529.4 million, marking a 22% year-over-year (YoY) growth and exceeding forecasts of $497.24 million.

“We continue to see success winning new business due to the superiority of MongoDB’s developer data platform in addressing a wide variety of mission-critical use cases,” Chief Executive Dev Ittycheria said in a statement.

For the full fiscal year, MongoDB raised its revenue guidance to a range of $1.973 billion to $1.977 billion, up from its previous outlook of $1.92 billion to $1.93 billion. 

Full-year adjusted earnings per share are now expected to range between $3.01 and $3.03, compared to the earlier projection of $2.33 to $2.47.

However, the company noted potential headwinds in Q4. Non-Atlas revenue is projected to decline sequentially due to significant multi-year deals closed in Q3 that won't repeat. 

Meanwhile, Atlas consumption is expected to slow YoY in Q4, reflecting a seasonal drop in application usage during the holidays.

Moreover, MongoDB is redirecting its go-to-market resources from mid-market customers to enterprise accounts. This strategic shift is expected to reduce mid-market customer additions and slow overall direct sales growth.

MongoDB Sentiment and Message Volume on Dec 9 as of 7:00 a.m. ET | Source: Stocktwits

Retail sentiment around the stock saw an uptick to ‘extremely bullish’ (93/100) from ‘bullish a day ago, along with an increase in chatter to ‘extremely high,’ marking the highest activity on the ticker this year. 

While MongoDB shares gained as much as 6% after hours on Monday, some users speculated that Oracle's disappointing earnings, reported earlier Tuesday, might be weighing on MongoDB's stock performance. Oracle's dominance in the database market could lead to broader sector concerns.

Overall, the stock is down nearly 9% so far this year. 

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