Stock prices for technology company MongoDB dropped dramatically on Tuesday, falling 27% to reach their lowest point in six months after the firm released disappointing financial projections and showed sluggish growth in its cloud database services.
The company’s Atlas cloud platform, which is positioned to benefit from the expanding use of artificial intelligence technology, saw revenue increase by 29% during the fourth quarter that concluded on January 31. This represented a decline from the 30% growth rate recorded in the prior quarter, and UBS financial analysts noted that MongoDB failed to provide a clear reason for this weaker performance.
Barclays analysts commented on the mixed results, stating: “Q4 was more mixed with a slightly lower Atlas beat level and below consensus FY27 guidance. Some of this could well be conservatism but in this tape, investors don’t have a lot of patience.”
Following the earnings announcement, more than 19 out of 42 financial analysts who track the company reduced their target prices for MongoDB stock, according to LSEG market data. These analysts also expressed concerns about the uncertain future growth prospects for the Atlas platform.
These disappointing results reflect broader challenges facing the software industry, where company stocks have taken significant hits in recent months due to concerns that AI tools developed by emerging companies like Anthropic might threaten traditional revenue sources.
If the stock losses continue, MongoDB could lose approximately $6 billion from its total market value of $26.45 billion.
Despite the cloud service concerns, MongoDB’s total revenue of $695 million exceeded analyst predictions, which had averaged $667.2 million according to LSEG compiled data.
For the upcoming first quarter, the company projected adjusted earnings between $1.15 and $1.19 per share, falling short of the $1.20 average estimate from Wall Street analysts.
