MongoDB, Inc.

Thank you for standing by, and welcome to MongoDB's first quarter fiscal year 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone. I would now like to hand the call over to Brian Dinu with ICR. Please go ahead.

All right. Thank you, Lateef. Good afternoon, and thank you for joining us today to review MongoDB's first quarter fiscal 2024 financial results, which we announced in our press release issued after the close of market today. Joining me on the call today are Dave Itacheria, President and CEO of MongoDB, and Michael Gordon, MongoDB's COO and CFO. During this call, we will make forward-looking statements, including statements related to our market and future growth opportunities, the benefits of our product platform, our competitive landscape, customer behaviors, our financial guidance, and our planned investments. These statements are subject to a variety of risks and uncertainties, including the results of operations and financial conditions that could cause actual results to differ materially from our expectations. For discussion of the material risks and uncertainties that could affect our actual results, please refer to the risk described in our annual report on Form 10-K for the year ended January 31st, 2023, filed with the SEC on March 17th, 2023. Any forward-looking statements made in this call reflect our views only as of today, and we undertake no obligation to update them except as required by law. Additionally, we will discuss non-GAAP financial measures on this conference call. Please refer to the tables in the earnings release on the investor relations portion of our website for reconciliation of these measures to their most directly comparable GAAP financial measures. With that, I'd like to turn the call over to Dave.

Thanks, Brian, and thank you to everyone for joining us today. I'm pleased to report that we had another strong performance in the first quarter and we continue to execute well despite challenging market conditions. I will start by reviewing our first quarter results before giving you a broader company update. But first, I would like to personally invite all of you to the investor session at mongodb.local New York City to be held at the Javits Center on June 22nd. Please email ir at mongodb.com if you are interested in attending. Now, turning to our results. We generated revenue of $368 million, a 29% year-over-year increase and above the high end of our guidance. Atlas revenue grew 40% year-over-year, representing 65% of revenue, and we had another strong quarter of customer growth, ending the quarter with over 43,100 customers. Overall, we delivered a strong Q1. We had a very healthy quarter of new business acquisition. We added approximately 2,300 customers during the quarter, the highest number in over two years, including over 300 new direct sales customers with notable strength in our enterprise channel. Our ongoing new business success is due to the mission criticality of our platform and sharp execution by our go-to-market teams who are navigating a difficult selling environment by remaining laser focused on our North Star acquiring new workloads. In fact, this quarter we acquired a record number of new workloads from our existing customers. Moving on to Atlas consumption trends, Q1 consumption was ahead of our expectations, but remains below the levels we saw prior to the macro slowdown that began last year. Michael will share more detail on this. Finally, retention rates remain strong in Q1, reinforcing the enduring value in our platform. We are pleased with our results this quarter, especially given the difficult macro environment. It's clear customers continue to scrutinize their technology investments and must decide which technologies are a must-have versus merely a nice-to-have. We believe that our Q1 performance and continued new business strength demonstrate that MongoDB is clearly a must-have for customers. In today's digital economy, most companies express their business strategy through software. They use software to deliver their core value proposition, provide customers with great experiences, and drive operational efficiency. MongoDB is an essential platform in this drive for innovation, making us a critical investment priority. Our customers, ranging from the largest companies in the world to cutting-edge startups, use our developer data platform to develop and run mission-critical applications. As these applications become successful, customers spend more with MongoDB. In other words, their spend on our platform is directly aligned with their usage of their underlying application, therefore the value they derive from it. While the growth rate of existing applications can vary based on a number of factors, including macro conditions, the relationship between application usage growth and MongoDB spend has remained consistent. We believe this is a testament to how well our value proposition is aligned to our customers' success. Thinking about our long-term opportunity, I feel exceptionally confident about our core underlying growth driver, the need for companies to use software as a competitive advantage. Customers have ever-increasing expectations for better products, services, and experiences, and companies rely on custom-built software to deliver these expectations better and faster than their competition. As I've said many times in the past, a durable competitive advantage is built through custom software. It cannot be obtained with an off-the-shelf product. Since most companies understand that they and their competition are all differentiating themselves through software, the speed of software development becomes existential. A McKinsey report found that companies that score in the top quartile of developer velocity generate revenue growth that is four to five times faster than companies in the bottom quartile. MongoDB is built for speed. We believe AI will be the next frontier of developer productivity and will likely lead to a step function increase in software development velocity. We know that most organizations have a huge backlog of projects they would like to take on, but they just don't have the development capacity to pursue. As developer productivity meaningfully improves, companies can dramatically increase their software ambitions and rapidly launch many more applications to transform their business. Consequently, the importance of development velocity to remain competitive will be even more pronounced. Said another way, if you are slow, then you are obsolete. Moreover, the shift to AI will favor modern platforms that offer a rich and sophisticated set of capabilities delivered in a performant and scalable way. We are observing an emerging trend where customers are increasingly choosing Atlas as a platform to build and run new AI applications. For example, in Q1, more than 200 of the new Atlas customers were AI or ML companies. Well-financed startups like Hugging Face, Techion, OneAI, and Neuro are examples of companies using MongoDB to help deliver the next wave of AI-powered applications to their customers. We also believe that many existing applications will be re-platformed to be AI-enabled. This will be a compelling reason for customers to migrate from legacy technologies to MongoDB. To summarize, AI is just the latest example of a technology that promises to accelerate the production of more applications and greater demand for operational data stores, especially the ones best suited for modern data requirements such as MongoDB. We look forward to telling you more at our investor session on June 22nd. Now I'd like to spend a few minutes reviewing the adoption trends of MongoDB across our customer base. MongoDB's developer data platform continues to gain momentum as customers across industries and around the world are running their mission-critical projects on Atlas. Organizations including Anywhere Real Estate, GE Healthcare, and Intuit are leveraging the power of our developer data platform. GE Healthcare has turned to MongoDB's developer data platform to manage the lifecycle of its IoT devices, imaging, ultrasound, and other patient care devices from deployment to retirement. They selected Atlas for its effective management, scalability, built-in security, and multi-cloud support. GE Healthcare's use of Atlas helps healthcare providers enhance productivity by reducing the complexity and time required to manage databases, resulting in an 83% decrease in data retrieval time and enabling faster deployment of IoT devices. Many customers are turning to MongoDB to free up their developers' time for innovation, enabling them to move faster and deliver better customer experiences while driving cost savings. This includes China Mobile, Tata Digital, and Grant Thornton International. China Mobile provides mobile voice and multimedia services via its nationwide mobile telecom network across mainland China and Hong Kong. It is the world's largest mobile network operator by total number of subscribers. The telecom leader is using MongoDB to support one of its largest and most critical push services, which sends out billing details to more than 1 billion users every month. Prior to MongoDB, the tech team relied on Oracle, but as the user numbers increased, performance degraded. Despite large investments, it was still taking too long to do basic requests like finalize and deliver bills to users. As a result, China Mobile migrated the service to MongoDB after comprehensive testing and evaluation of alternatives. By taking advantage of MongoDB's native sharding, they were able to improve performance by 80% and go from 50 Oracle machines to just 12 machines for the same workload. The service now handles all current requirements and is set up to scale with future growth. Digital transformation is redefining how organizations operate, and MongoDB is helping customers on this journey by delivering the developer data platform that powers the migration from on-premises to the cloud. Companies including Shutterfly, Radial, and Bandigo and Adelaide Bank are examples of customers leveraging MongoDB in their transformations. A leader in the HR and job-finding tech space shifted from MongoDB Community to MongoDB Atlas during its journey to migrate its entire infrastructure from on-premises to the cloud. They selected MongoDB Atlas to give its developers full autonomy over their data, while freeing up the time they previously spent managing their database system to focus on innovation and improving the end-user experience. During their migration journey to Atlas, the company identified opportunities for significant infrastructure reduction and subsequent cost savings. the company has experienced 250% faster query performance and 300% faster write throughput on their applications built on Atlas. In summary, I am pleased with our first quarter results in a difficult macro environment, our ability to win new workloads remained strong, and Atlas consumption trends were better than expected. We also believe that AI will accelerate application development, which would further stimulate demand for MongoDB. We continue to invest to maximize our long-term growth opportunity. With that, here's Michael. Thanks, Dave.