MongoDB, Inc. (MDB): A Bull Case Theory

We came across a bullish thesis on MongoDB, Inc. on Compounding Your Wealth’s Substack by Sergey. In this article, we will summarize the bulls’ thesis on MDB. MongoDB, Inc.'s share was trading at $295.70 as of August 27^th. MDB’s forward P/E was 102.04 according to Yahoo Finance.

MongoDB delivered a strong second quarter of FY25, reporting $591 million in revenue, up 24% year-over-year and above guidance, with non-GAAP EPS of $1.00 that beat estimates by 54%. Operating margin expanded to 14.7%, while free cash flow margin improved to 11.8%, underscoring the scalability of its model. Atlas remained the growth engine, generating $438 million in revenue, up 27% year-over-year, and accounting for 74% of total revenue. Net new ARR surged 76% to $169 million, supported by strong consumption and robust enterprise adoption. Customer count grew to nearly 60,000, including 2,564 customers contributing over $100,000 in ARR, reflecting deepening penetration across large enterprises despite a modest decline in direct sales accounts.

Notable customer wins included a global automaker managing connected vehicles at scale, Deutsche Telekom consolidating systems for 30 million subscribers, and Agibank migrating to Atlas to achieve fivefold performance gains at lower costs. Product innovation continued with MongoDB 8.0, stream processing capabilities, and Vector Search, which is gaining traction in AI-native workloads such as autonomous driving and semantic search. The Voyage AI acquisition further strengthened MongoDB’s role at the intersection of enterprise data and AI by embedding embedding models directly into the platform.

While non-Atlas subscription revenue faces mid-single-digit declines and stock-based compensation remains high at 24% of revenue, Atlas growth is offsetting headwinds. Management raised FY26 revenue guidance to $2.34–$2.36 billion and operating margin to 14%, highlighting confidence in sustained growth. With Atlas accelerating, expanding platform differentiation, and a rising AI opportunity, MongoDB is positioned for durable long-term momentum.

Previously we covered a bullish thesis on MongoDB, Inc. (MDB) by TechFundies in March 2025, highlighting Atlas as the core growth driver, strong recurring revenue, and upside from improving margins and AI adoption. The stock has appreciated roughly 51% since then, reflecting Atlas’ momentum. The thesis still stands as the platform scales. Sergey shares a similar view but emphasizes record ARR growth and AI-driven expansion.

MongoDB, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 72 hedge fund portfolios held MDB at the end of the first quarter which was 70 in the previous quarter. While we acknowledge the potential of MDB as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.

Disclosure: None.