MongoDB (MDB) is fully committed to breakthrough in the large and rapidly growing database market, which is being greatly boosted by artificial intelligence. MDB shares have doubled this year on the back of strong earnings and new product releases.
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New York-based Mongo DB’s open source platform helps developers build databases and apps designed to be fast, flexible, and scalable. In addition, powerful AI capabilities can be integrated, giving you a competitive edge.
“You can’t use off-the-shelf shrinkwrap software. It has to be customizable,” Ivan Finces, research director at Tigress Financial Partners, told Investors Business Daily. “MongoDB allows us to customize our AI tools and software to create a competitive advantage.”
Using generative AI, he added, businesses can identify patterns and customer reactions to uncover marketing and sales opportunities.
“Every company will be an AI company,” said Finess. “They will need to deploy some form of AI to unlock the value of the data they have.”
Huge Market Opportunity for MDB Stocks
Analysts say MongoDB’s market potential is huge. Market research firm IDC predicts that the database market will grow from $81 billion in 2023 to $136 billion in 2027. This also does not include generative AI effects.
“Underscoring the nascent nature of this opportunity, today less than 40% of Fortune 500 companies and less than 25% of Global 2000 companies are MongoDB customers,” said Jason Ader, MDB equity analyst at William Blair and Sebastian Nagy said in a recent memo to clients. . “Among these customers, MongoDB still has a small footprint.”
Michael Gordon, MongoDB’s chief operating officer and chief financial officer, says the company is “just getting started.”
“Our market share is approaching 2%,” Gordon told IBD in a statement. “We are in the midst of a massive technological change, especially with generative AI, which is accelerating the development of more applications and increasing the demand for operational data stores.”
He added, “Enterprises recognize the need to innovate rapidly to meet customer demand, and MongoDB Atlas is the ideal platform to achieve that goal.”
MongoDB’s main platform, Atlas, uses what is known as NoSQL. It is a document-based data model that creates unstructured, non-relational data documents. This provides capabilities such as real-time large data processing and AI integration.
Tech giant rival database
By comparison, traditional relational databases use Structured Query Language (SQL) to build tabular databases. Examples include: microsoft(MSFT) SQL Server, Oracle(ORCL) database, IBM(IBM) DB2, and independent MySQL.
MongoDB’s platform integrates with three major cloud providers: Amazon(AMZN) Amazon Web Services, Microsoft Azure and alphabetof (GOOGL) Google Cloud.
“We also offer the only true multi-cloud developer data platform that offers high performance and availability in over 110 cloud regions worldwide. Sovereignty requirements can be met more easily,” said Gordon of the company.
In early June, MongoDB reported strong earnings for the first quarter of fiscal year 2024, which ended April 30. Revenue increased 29% year-over-year to $386 million as Atlas usage increased. Atlas revenue increased his 40% and added 2,300 net new customers to him during the quarter. This is his highest increase in over two years here. It now accounts for 65% of total revenue.
MongoDB also raised its revenue and operating profit guidance for fiscal 2024. It now expects revenues of more than $1.5 billion and operating income of more than $110 million. Shares of MDB soared 33% on the news and have held off since then.
This came after a disappointing fourth quarter of fiscal year 2023. At that point, management downgraded its future outlook, citing slowing macro and customer demand. However, the trend seems to have reversed with MongoDB. Its “mission-critical” features underscore the non-discretionary nature of its platform.
MDB Stocks: Half of the Fortune 100 Are Customers
MongoDB has over 43,000 customers. They range in size from hot new AI startups to traditional enterprise customers. It is also spread across industries, with the financial sector accounting for the largest share. Other industries include healthcare, retail and manufacturing.
Over half of the Fortune 100 companies are MongoDB customers. Additionally, 19 of the top 20 rows in the US use MongoDB. In Europe, 8 of the top 10 banks use the company, and 6 out of 10 banks worldwide use its platform.
During fiscal 2023, three-quarters of the company’s annual recurring revenue came from enterprise-level customers. The rest were split between midmarket and self-service customers.
Top 100 customers generated 36% of annual recurring revenue. And 59% of the top 100 companies have used his MongoDB product for more than his 5 years.
Additionally, MongoDB’s large customer base has grown significantly over the last few years. The number of companies with recurring revenues exceeding $1 million increased from 42 in FY2019 to 213 in FY2023.
More business from existing customers
What makes MongoDB different is that its competitors are based on acquiring additional workflows such as database projects with existing customers. It’s not just about getting new customers.
“The number of million-dollar customers is growing significantly, but that customer group is coming to the platform from smaller entrees,” said Finesse, an MDB equity analyst at Tigress. rice field. “So they’re getting companies that start with, say, $50,000 a year (expenditure) and continue to grow. They’re not necessarily small, they’re big companies with smaller migration workflow businesses. There are also smaller companies,” which are growing. “
At its developer conference in June in New York, MongoDB announced a number of new products and features. Many are designed to help streamline AI integration.
Relational Migrator simplifies the process of switching from traditional relational databases to MongoDB’s document-based platform. This process automates and accelerates the conversion, reducing switching costs for companies.
Atlas Vector Search applies context and meaning to the data in your search, unlike traditional indexing that uses exact keywords. Atlas Stream Processing enables enterprises to process streaming data. This includes data from internet browsing, real-time inventory management, and credit card fraud prevention.
Other partnerships and new releases
The company also expanded its partnership with Google Cloud. We plan to accelerate the use of generative AI and create a new class of applications for developers.
Other releases included dedicated search notes, queryable encryption, time series, online archives, and data federation. The new AI Innovator Program will help start-ups and more established companies leverage and build on generative artificial intelligence.
“We believe recent advances in generative AI technologies like large-scale language models present great opportunities for MongoDB over time,” said Gordon of MongoDB. “As more applications are created, the demand for operational data stores like MongoDB will increase.”
“Furthermore, we expect most applications to add AI capabilities over time,” he said. It just means there are more possibilities,” he added.
The MDB stock holds the highest possible IBD Overall Rating of 99, which provides the stock’s overall rating. In addition, it has a relative strength rating of 97, indicating performance in the top 3% of all stocks over the past 12 months.
The MDB stock also appears on IBD’s Tech Leaders list, the IBD Leaderboard, and the IBD 50 list.
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