Snapshot
MongoDB, Inc. reported $591M of revenue in Q2 2026, up 23.7% year over year, with diluted EPS of $-0.58 and an operating margin of -11.0%.
- Revenue
- $591M
- YoY growth
- +23.7%
- Diluted EPS
- $-0.58
- Operating margin
- -11.0%
What management said
- •Looking statements, including statements related to our market and future growth opportunities, our opportunity to win new business, our expectations regarding.
- •Atlas consumption growth, the impact of non-Atlas business, and multi-year license revenue.
- •The long term opportunity of AI, our financial guidance and underlying assumptions, and our.
- •Please refer to the tables in the earnings release on the Investor Relations portion of our website for a reconciliation of these measures to the most directly comparable GAAP financial measure.
- •During our Dot Local conference, we'll spend the day discussing the investments we're making to drive durable growth and margin expansion and our view of the future.
- •We generated revenue of $591 million, up 24% year-over-year and above the high end of our guidance.
- •We delivered non-GAAP operating income of $87 million for a 15% non-GAAP operating margin, and we ended the quarter with over 59,900 customers.
- •Atlas performance was strong, accelerating to 29% year-over-year growth, up from 26% in Q1.
- •At the same time, we significantly outperformed on operating margin, demonstrating that we can drive durable revenue growth while expanding profitably.
- •With Atlas, Agibank gained a resilient, flexible system that handled rising demand and supported new services, delivering nearly five times better performance and 90% lower costs, all with no outages.
- •They now rely on Atlas to handle over 1 billion vectors and expect 10x growth in data usage by next year.
- •I'll begin with a detailed review of our second quarter results and then finish with our outlook for the third quarter and fiscal year 2026.
What went well
- •Total revenue was $591 million, up 24% year-over-year and above the high end of guidance.
- •Atlas revenue accelerated to 29% year-over-year growth, up from 26% in Q1, and now represents 74% of total revenue.
- •Non-GAAP operating income was $87 million for a 15% operating margin, compared to 11% in the year-ago period, driven mainly by revenue outperformance.
- •The company added approximately 2,800 customers sequentially to reach 59,900 total, and added over 5,000 customers over the last two quarters.
- •Operating cash flow of $72 million and free cash flow of $70 million were well above expectations, compared to -$1 million and -$4 million respectively a year ago.
- •Management raised full-year fiscal 2026 revenue guidance by $70 million and increased operating margin guidance by 150 basis points at the high end.
What went wrong
- •Gross margin declined to 74% from 75% in the year-ago period, driven by Atlas growing as a percent of the overall business.
- •Non-Atlas ARR grew only 7% year-over-year, single-digit growth that management acknowledged was not fully satisfying.
- •Direct sales customers declined by 200 sequentially to over 7,300 and were flat year-over-year, due to reallocating go-to-market resources from mid-market to enterprise.
- •A modest restructuring impacted less than 2% of employees and resulted in approximately $5 million of one-time charges.
Guidance changes
| Metric | Period | Previous | Current | Change |
|---|---|---|---|---|
| Full-year FY2026 revenue | FY2026 | prior guidance | raised by $70 million (including $38 million Q2 outperformance) | raised |
| Operating margin (high end) | FY2026 | prior guidance | raised by 150 basis points | raised |
| Atlas growth (second half) | H2 FY2026 | — | mid-20s % growth implied | — |
Performance breakdown
| Metric | YoY change | Reason |
|---|---|---|
| Total revenue | +24% | Strong broad-based demand, especially in larger U.S. customers, and above the high end of guidance. |
| Atlas revenue | +29% | Strong consumption consistent with last year's rates, a strong start to consumption in May, and broad-based strength especially in larger U.S. customers. |
| Non-Atlas ARR | +7% | Continued success selling incremental workloads into the existing EA customer base. |
| Operating margin | 15% vs 11% | Benefited mainly from revenue outperformance. |
| Net AR expansion rate | ~119% | Consistent with recent quarters. |
| $100K+ ARR customers | +17% | 2,564 customers with at least $100,000 in ARR. |
Earnings call themes & trends
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Atlas consumption | 26% growth in Q1 | 29% growth in Q2, accelerating | improving |
| Move up-market / higher-quality workloads | go-to-market reallocation to enterprise started in H2 last year | acquired workloads growing faster, bigger, and for longer than past workloads | improving |
| AI as a growth driver | thousands of AI-native customers being added | AI cohort still not material to growth; enterprise AI adoption real but early | stable/early |
| Multi-year deals | large multi-year deals in fiscal 2025 | more multi-year deals than expected, more widespread and not large; about half the non-Atlas outperformance | improving |
| Self-serve channel | ongoing optimization | accelerating despite move up-market, driven by data-driven experiments and SQL developer outreach | improving |
Q&A summary
What drove the strong sequential dollar adds and acceleration in Atlas in Q2?
Dev Ittycheria attributed it largely to workloads acquired over the past year, especially from the move up-market, which are growing faster and bigger than previous workloads, plus uptake of search and vector search and the many new customers added over the prior six months.
Is the AI cohort materially driving Atlas strength this quarter?
No. Ittycheria said that while thousands of AI-native customers are being added, the growth delivered this quarter was not material to that cohort; it was driven by the core business and core customer base.
How did Atlas consumption trends play out in the quarter?
Mike Berry said consumption grew 29% year-over-year, relatively consistent with last year, with a strong May and broad-based strength across geographies and segments, but notable strength in larger U.S. customers whose workloads are growing for longer and expanding more than in the past.
Was the multi-year deal outperformance due to customers renewing earlier (filling the divot)?
Berry said no, it did not fill the divot and there were no pull-forwards; it was good underlying ARR strength plus greater-than-expected multi-year across a good subset of customers, with no large multi-years involved.
Where is the most momentum in AI workloads and when will it contribute materially?
Ittycheria said customers are very interested in MongoDB's JSON architecture, integrated search/vector search, and embedded Voyage AI models, but enterprise AI uptake is still early, focused on productivity use cases; enduring value will come when customers build custom AI solutions, and it was a small part of growth this quarter.
How are you balancing growth investment with margin expansion?
Berry said the number one driver of margin expansion is revenue growth; the business model generates substantial gross profit when Atlas grows 20%+ and non-Atlas stays single-digit, funding investment in growth while the team reallocates spend away from areas not driving growth.