According to a recent report, the global database-as-a-service market grew to $12.8 billion in 2020. The market is expected to grow 20% through 2026. MongoDB (Nasdaq: MDB), a leading player in the market, recently reported its second-quarter results that continued to surpass market expectations. Its stock surged 25% to a 52-week high following the results.

MongoDB’s Financials

MongoDB’s revenues for the second quarter grew 44% to $198.7 million, ahead of the market’s forecast of $157 million. Adjusted loss of $0.24 per share was also ahead of the Street’s forecast of a loss of $0.39 per share.

By segment, Subscription revenues grew 44% to $191.4 million, and services revenues grew 27% to $7.4 million.

For the third quarter, MongoDB expects revenues of $202-$204 million with a net loss of $0.42-$0.39 per share. It expects to end the year with revenues of $805-$811 million and a net loss of $1.20-$1.13 per share. The market was looking for revenues of $184.2 million for the quarter with a net loss of $0.39 per share and revenues of $786.06 million for the year with a net loss of $1.29 per share.

MongoDB’s Product Upgrades for Atlas

During the quarter, MongoDB announced a series of product enhancements including the launch and general availability of MongoDB 5.0 with new native time series support, the preview of serverless databases in MongoDB Atlas, and new updates to Atlas Search, Atlas Data Lake, and Realm.

New features to MongoDB 5.0 include native time-series collections, clustered indexing, and window function to make building and running apps like IoT and financial analytics easier, faster, and cheaper, as well as enriching enterprise data with time-series measurements. It also provides developers with future-proof application compatibility with versioned API. The solution decouples the application lifecycle from the database lifecycle, thus giving developers the assurance that their application code will continue to run unchanged with no interruption, even when the database continues to get upgraded and improved. It also brings strong data privacy controls to multi-cloud clusters through always-on auditing and certificate rotation that helps users maintain a strict security posture with no interruption to applications.

Within its Atlas product, Atlas Search now includes Function Scoring that allows users to apply mathematical formulas on fields within documents to influence their relevance. Users can define collections of synonyms for a particular search index. They can also use Realm to store game data, like scores and player stats, and sync it automatically across devices. MongoDB Charts is now integrated with Atlas Data Lake so that users can easily visualize data stored in Amazon AWS without any data movement to help users to discover deeper insights in real-time. MongoDB recently got FedRAMP ready status for MongoDB Atlas for Government. The certification will help MongoDB expand its presence within the government sector.

According to a study by Gartner earlier this year, 75% of all databases are expected to be deployed or migrated to a cloud platform by 2022. The cloud database subsegment is estimated to grow at 18% CAGR over the period 2020 through 2025. MongoDB’s Atlas focuses on this niche and has seen rapid growth over the past few years. Atlas revenue grew 83% in Q2, accounted for 56% of revenues, and is operating at a run rate of $0.5 billion. Analysts estimate MongoDB’s market share in the NoSQL market to be within the 15%-20% range. It is a competitive market with players like Oracle NoSQL, Cassandra, and Couchbase, to name a few. But market reviews suggest that MongoDB wins the developers over by enabling them to develop faster ML and AI applications.

Its stock is currently trading at $507.41 with a market capitalization of $32.8 billion. It touched a 52-week high of $508.97 last week following its results. It was trading at a 52-week low of $200.50 in September last year.