SEC Filing | MongoDB, Inc.

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mdb-20220731

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

___________________

FORM 10-Q

___________________

(Mark One)

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 31, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38240

___________________

MONGODB, INC.

(Exact Name of Registrant as Specified in its Charter)

___________________


Delaware		26-1463205
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
1633 Broadway,	38th Floor
New York,	NY	10019
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: 646-727-4092

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.001 per share

MDB

The Nasdaq Stock Market LLC

(Nasdaq Global Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	þ	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

As of August 30, 2022, there were 68,707,084 shares of the registrant’s common stock, par value $0.001 per share, outstanding.

Table of Contents


		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements	1
	Unaudited Condensed Consolidated Balance Sheets as of July 3 1 , 2022 and January 31, 2022	1
	Unaudited Condensed Consolidated Statements of Operations for the three and six months ended July 3 1 , 2022 and 2021	2
	Unaudited Condensed Consolidated Statements of Comprehensive Loss for the three and six months ended July 3 1 , 2022 and 2021	3
	Unaudited Condensed Consolidated Statements of Stockholders’ Equity (Deficit)	3
	Unaudited Condensed Consolidated Statements of Cash Flows for the six months ended July 31, 2022 and 2021	6
	Notes to Condensed Consolidated Financial Statements (unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4.	Controls and Procedures	34

PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	35
Item 1A.	Risk Factors	35
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	66
Item 3.	Defaults Upon Senior Securities	66
Item 4.	Mine Safety Disclosures	66
Item 5.	Other Information	66
Item 6.	Exhibits	67
Signatures		68

Table of Contents

PART I—FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

MONGODB, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands of U.S. dollars, except share and per share data)

(unaudited)


	July 31, 2022		January 31, 2022
Assets
Current assets:
Cash and cash equivalents	$	651,420	$	473,904
Short-term investments	1,144,192		1,352,019
Accounts receivable, net of allowance for doubtful accounts of $4,960 and $4,966 as of July 31, 2022 and January 31, 2022, respectively	213,267		195,383
Deferred commissions	72,069		63,523
Prepaid expenses and other current assets	27,566		32,573
Total current assets	2,108,514		2,117,402
Property and equipment, net	61,604		62,625
Operating lease right-of-use assets	46,418		41,745
Goodwill	57,779		57,775
Acquired intangible assets, net	16,018		20,608
Deferred tax assets	2,163		1,939
Other assets	159,102		147,494
Total assets	$	2,451,598	$	2,449,588
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	7,303	$	5,234
Accrued compensation and benefits	83,806		112,568
Operating lease liabilities	9,163		8,084
Other accrued liabilities	73,916		48,848
Deferred revenue	350,709		352,001
Total current liabilities	524,897		526,735
Deferred tax liability, non-current	95		81
Operating lease liabilities, non-current	40,437		38,707
Deferred revenue, non-current	24,462		23,179
Convertible senior notes, net	1,138,200		1,136,521
Other liabilities, non-current	55,339		57,665
Total liabilities	1,783,430		1,782,888
Commitments and contingencies (Note 7)

Stockholders’ equity:
Common stock, par value of $0.001 per share; 1,000,000,000 shares authorized as of July 31, 2022 and January 31, 2022; 68,785,903 shares issued and 68,686,532 shares outstanding as of July 31, 2022; 67,543,731 shares issued and 67,444,360 shares outstanding as of January 31, 2022	69		67
Additional paid-in capital	2,059,405		1,860,514
Treasury stock, 99,371 shares (repurchased at an average of $13.27 per share) as of July 31, 2022 and January 31, 2022	(1,319)		(1,319)
Accumulated other comprehensive loss	(4,194)		(2,928)
Accumulated deficit	(1,385,793)		(1,189,634)
Total stockholders’ equity	668,168		666,700
Total liabilities and stockholders’ equity	$	2,451,598	$	2,449,588

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

MONGODB, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands of U.S. dollars, except share and per share data)

(unaudited)


	Three Months Ended July 31,				Six Months Ended July 31,
	2022		2021		2022		2021
Revenue:
Subscription	$	291,607	$	191,381	$	566,188	$	365,951
Services	12,053		7,366		22,919		14,444
Total revenue	303,660		198,747		589,107		380,395
Cost of revenue:
Subscription	71,435		50,955		136,004		96,357
Services	16,842		9,747		30,488		18,873
Total cost of revenue	88,277		60,702		166,492		115,230
Gross profit	215,383		138,045		422,615		265,165
Operating expenses:
Sales and marketing	181,598		109,377		331,866		207,267
Research and development	108,037		72,396		204,409		137,147
General and administrative	40,591		28,803		77,123		54,728
Total operating expenses	330,226		210,576		613,398		399,142
Loss from operations	(114,843)		(72,531)		(190,783)		(133,977)
Other income (expense):
Interest income	1,680		157		2,304		330
Interest expense	(2,429)		(2,556)		(4,882)		(6,214)
Other income (expense), net	(224)		(665)		1,397		(1,102)
Loss before provision for income taxes	(115,816)		(75,595)		(191,964)		(140,963)
Provision for income taxes	3,049		1,538		4,195		162
Net loss	$	(118,865)	$	(77,133)	$	(196,159)	$	(141,125)
Net loss per share, basic and diluted	$	(1.74)	$	(1.22)	$	(2.88)	$	(2.26)
Weighted-average shares used to compute net loss per share, basic and diluted	68,334,464		63,426,694		68,025,687		62,411,295

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

MONGODB, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands of U.S. dollars)

(unaudited)


	Three Months Ended July 31,				Six Months Ended July 31,
	2022		2021		2022		2021
Net loss	$	(118,865)	$	(77,133)	$	(196,159)	$	(141,125)
Other comprehensive income (loss), net of tax:
Unrealized income (loss) on available-for-sale securities	1,163		(86)		(1,201)		(52)
Foreign currency translation adjustment	(678)		566		(65)		476
Other comprehensive income (loss)	485		480		(1,266)		424
Total comprehensive loss	$	(118,380)	$	(76,653)	$	(197,425)	$	(140,701)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

MONGODB, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

(in thousands of U.S. dollars, except share data)

(unaudited)


	Common Stock			Additional Paid-In Capital		Treasury Stock		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders’ Equity
	Shares	Amount
Balances as of January 31, 2022	67,444,360	$	67	$	1,860,514	$	(1,319)	$	(2,928)	$	(1,189,634)	$	666,700
Cumulative effect of accounting change	—	—		—		—		—		—		—
Stock option exercises	235,517	—		1,656		—		—		—		1,656
Vesting of early exercised stock options	—	—		—		—		—		—		—
Vesting of restricted stock units	381,178	1		—		—		—		—		1
Stock-based compensation	—	—		83,566		—		—		—		83,566
Conversion of convertible senior notes	8	—		1		—		—		—		1
Unrealized loss on available-for-sale securities	—	—		—		—		(2,364)		—		(2,364)
Foreign currency translation adjustment	—	—		—		—		613		—		613
Net loss	—	—		—		—		—		(77,294)		(77,294)
Balances as of April 30, 2022	68,061,063	$	68	$	1,945,737	$	(1,319)	$	(4,679)	$	(1,266,928)	$	672,879
Stock option exercises	163,986	—		1,332		—		—		—		1,332
Vesting of restricted stock units	388,483	1		—		—		—		—		1
Stock-based compensation	—	—		96,554		—		—		—		96,554
Conversion of convertible senior notes	18	—		5		—		—		—		5
Issuance of common stock, net of issuance costs	—	—		—		—		—		—		—
Issuance of common stock under the Employee Stock Purchase Plan	72,982	—		15,777		—		—		—		15,777
Unrealized gain on available-for-sale securities	—	—		—		—		1,163		—		1,163
Foreign currency translation adjustment	—	—		—		—		(678)		—		(678)
Net loss	—	—		—		—		—		(118,865)		(118,865)
Balances as of July 31, 2022	68,686,532	$	69	$	2,059,405	$	(1,319)	$	(4,194)	$	(1,385,793)	$	668,168

Table of Contents

MONGODB, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) (continued)

(in thousands of U.S. dollars, except share data)

(unaudited)


	Common Stock			Additional Paid-In Capital		Treasury Stock		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders’ Equity (Deficit)
	Shares	Amount
Balances as of January 31, 2021	60,898,451	$	61	$	932,332	$	(1,319)	$	(704)	$	(935,403)	$	(5,033)
Cumulative effect of accounting change	—	—		(309,381)		—		—		52,635		(256,746)
Stock option exercises	483,787	1		3,539		—		—		—		3,540
Vesting of early exercised stock options	—	—		10		—		—		—		10
Vesting of restricted stock units	341,939	—		—		—		—		—		—
Stock-based compensation	—	—		50,914		—		—		—		50,914
Conversion of convertible senior notes	372,096	—		2,999		—		—		—		2,999
Unrealized gain on available-for-sale securities	—	—		—		—		34		—		34
Foreign currency translation adjustment	—	—		—		—		(90)		—		(90)
Net loss	—	—		—		—		—		(63,992)		(63,992)
Balances as of April 30, 2021	62,096,273	$	62	$	680,413	$	(1,319)	$	(760)	$	(946,760)	$	(268,364)
Stock option exercises	282,519	—		2,206		—		—		—		2,206
Vesting of restricted stock units	362,342	—		—		—		—		—		—
Stock-based compensation	—	—		57,705		—		—		—		57,705
Conversion of convertible senior notes	844,194	1		56,682		—		—		—		56,683
Issuance of common stock, net of issuance costs	2,500,000	3		889,181		—		—		—		889,184
Issuance of common stock under the Employee Stock Purchase Plan	45,261	—		12,963		—		—		—		12,963
Unrealized loss on available-for-sale securities	—	—		—		—		(86)		—		(86)
Foreign currency translation adjustment	—	—		—		—		566		—		566
Net loss	—	—		—		—		—		(77,133)		(77,133)
Balances as of July 31, 2021	66,130,589	$	66	$	1,699,150	$	(1,319)	$	(280)	$	(1,023,893)	$	673,724

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

MONGODB, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands of U.S. dollars)

(unaudited)


	Six Months Ended July 31,
	2022		2021
Cash flows from operating activities
Net loss	$	(196,159)	$	(141,125)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	7,745		6,622
Stock-based compensation	180,120		108,619
Amortization of debt issuance costs	1,685		2,319
Amortization of finance right-of-use assets	1,987		1,988
Amortization of operating right-of-use assets	4,458		3,232
Deferred income taxes	(302)		(2,378)
Accretion of discount on short-term investments	4,076		2,994

Gain on non-marketable securities	(1,694)		—
Unrealized foreign exchange (gain) loss	(1,144)		1,044
Change in operating assets and liabilities:
Accounts receivable	(19,480)		16,323
Prepaid expenses and other current assets	4,908		(5,849)
Deferred commissions	(16,555)		(16,456)
Other long-term assets	(862)		(52)
Accounts payable	2,161		447

Accrued liabilities	(201)		1,467
Operating lease liabilities	(4,549)		(2,595)
Deferred revenue	331		9,791
Other liabilities, non-current	378		4,068
Net cash used in operating activities	(33,097)		(9,541)
Cash flows from investing activities
Purchases of property and equipment	(5,152)		(2,332)
Acquisition, net of cash acquired	—		(4,469)
Investment in non-marketable securities	(1,119)		(1,136)
Proceeds from maturities of marketable securities	400,000		275,000
Purchases of marketable securities	(197,614)		(403,986)
Net cash provided by (used in) investing activities	196,115		(136,923)
Cash flows from financing activities

Proceeds from exercise of stock options	2,988		5,745
Proceeds from issuance of common stock, net of issuance costs	—		889,564
Proceeds from the issuance of common stock under the Employee Stock Purchase Plan	15,777		12,963
Principal repayments of finance leases	(1,882)		(2,415)

Repayments of convertible senior notes attributable to principal	—		(27,594)


Net cash provided by financing activities	16,883		878,263
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(2,395)		(502)
Net increase in cash, cash equivalents and restricted cash	177,506		731,297
Cash, cash equivalents and restricted cash, beginning of period	474,420		430,222
Cash, cash equivalents and restricted cash, end of period	$	651,926	$	1,161,519
Supplemental cash flow disclosure
Cash paid during the period for:
Income taxes, net of refunds	$	4,233	$	2,362
Interest expense	$	2,925	$	3,281





Reconciliation of cash, cash equivalents and restricted cash within the condensed consolidated balance sheets, end of period, to the amounts shown in the statements of cash flows above:
Cash and cash equivalents	$	651,420	$	1,160,996
Restricted cash, non-current	506		523
Total cash, cash equivalents and restricted cash	$	651,926	$	1,161,519

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

MONGODB, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Description of Business

MongoDB, Inc. (“MongoDB” or the “Company”) was originally incorporated in the state of Delaware in November 2007 under the name 10Gen, Inc. In August 2013, the Company changed its name to MongoDB, Inc. The Company is headquartered in New York City. MongoDB is the leading modern, general purpose database platform. The Company’s robust platform enables developers to build and modernize applications rapidly and cost-effectively across a broad range of use cases. Organizations can deploy the Company’s platform at scale in the cloud, on-premise or in a hybrid environment. In addition to selling subscriptions to its software, the Company provides post-contract support, training and consulting services for its offerings. The Company’s fiscal year ends on January 31.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying interim condensed consolidated balance sheet as of July 31, 2022, the interim condensed consolidated statements of stockholders’ equity (deficit) for the three and six months ended July 31, 2022 and 2021, the interim condensed consolidated statements of operations and of comprehensive loss for the three and six months ended July 31, 2022 and 2021 and the interim condensed consolidated statements of cash flows for the six months ended July 31, 2022 and 2021 are unaudited. The interim unaudited condensed consolidated financial statements have been prepared on a basis consistent with the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to state fairly the Company’s financial position as of July 31, 2022, its statements of stockholders’ equity (deficit) as of July 31, 2022 and 2021, its results of operations and of comprehensive loss for the three and six months ended July 31, 2022 and 2021 and its statements of cash flows for the six months ended July 31, 2022 and 2021. The financial data and the other financial information disclosed in the notes to these interim condensed consolidated financial statements related to the three- and six-month periods are also unaudited. The results of operations for the three and six months ended July 31, 2022 are not necessarily indicative of the results to be expected for the fiscal year ending January 31, 2023 or for any other future year or interim period.

The interim unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and accounts have been eliminated. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the applicable rules and regulations of the Securities and Exchange Commission. The condensed balance sheet data as of January 31, 2022 was derived from the Company’s audited financial statements, but does not include all disclosures required by U.S. GAAP. Therefore, these interim unaudited condensed consolidated financial statements and accompanying footnotes should be read in conjunction with the Company’s annual consolidated financial statements and related footnotes included in its Annual Report on Form 10-K for the fiscal year ended January 31, 2022 (the “2022 Form 10-K”).

Use of Estimates

The preparation of the interim unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Such estimates include, but are not limited to, revenue recognition, allowances for doubtful accounts, the incremental borrowing rate related to the Company’s lease liabilities, stock-based compensation, legal contingencies, fair value of acquired intangible assets and goodwill, useful lives of acquired intangible assets and property and equipment, fair value of non-marketable securities and accounting for income taxes. The Company bases these estimates on historical and anticipated results, trends and various other assumptions that it believes are reasonable under the circumstances, including assumptions as to future events.

The ongoing COVID-19 pandemic and global macroeconomic conditions, including rising interest rates and inflation, continue to impact demand and supply for a broad variety of goods and services, including demand from the Company’s customers, while also disrupting sales channels and marketing activities for an unknown period of time.

Estimates and assumptions about future events and their effects cannot be determined with certainty and therefore require the exercise of judgment. As of the date of issuance of these financial statements, the Company is not aware of any specific event or circumstance that would require the Company to update its estimates, assumptions and judgments or adjust

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MONGODB, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

the carrying value of its assets or liabilities. These estimates may change as new events occur and additional information is obtained and are recognized in the consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to the Company’s financial statements.

Significant Accounting Policies

There have been no changes to the Company’s significant accounting policies as described in the Company’s 2022 Form 10-K.

3. Fair Value Measurements

The following tables present information about the Company’s financial assets that have been measured at fair value on a recurring basis as of July 31, 2022 and January 31, 2022 and indicate the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):


	Fair Value Measurement as of July 31, 2022
	Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents:
Money market funds	$	520,528	$	—	$	—	$	520,528
Short-term investments:
U.S. government treasury securities	1,144,192		—		—		1,144,192
Total financial assets	$	1,664,720	$	—	$	—	$	1,664,720


	Fair Value Measurement as of January 31, 2022
	Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents:
Money market funds	$	331,221	$	—	$	—	$	331,221
Short-term investments:
U.S. government treasury securities	1,352,019		—		—		1,352,019
Total financial assets	$	1,683,240	$	—	$	—	$	1,683,240

The Company utilized the market approach and Level 1 valuation inputs to value its money market mutual funds and U.S. government treasury securities because published net asset values were readily available. The contractual maturity of all marketable securities was less than one year as of July 31, 2022 and January 31, 2022. As of July 31, 2022, unrealized losses on our U.S. government treasury securities were approximately $4.6 million. The increase in market interest rates as of July 31, 2022 has resulted in unrealized losses on these securities. The Company intends to hold these securities to maturity and, as a result, does not expect to realize these losses in its financial statements. The Company concluded that an allowance for credit losses was unnecessary for short-term investments as of July 31, 2022. Gross realized gains and losses were not material for each of the three- and six-month periods ended July 31, 2022 and 2021.

Convertible Senior Notes

The Company measures the fair value of its outstanding convertible senior notes on a quarterly basis for disclosure purposes. The Company considers the fair value of its convertible senior notes at July 31, 2022 to be a Level 2 measurement due to limited trading activity of the convertible senior notes. Refer to Note 5, Convertible Senior Notes, for further details.

Non-marketable Securities

As of July 31, 2022 and January 31, 2022, the total amount of non-marketable equity and debt securities included in other assets on the Company’s condensed consolidated balance sheets were $7.7 million and $4.8 million, respectively. During the six months ended July 31, 2022, the Company invested an additional $1.1 million of its cash in non-marketable equity securities. In addition, the Company recognized a gain on certain of these non-marketable securities of $1.7 million during the six months ended July 31, 2022. No gain or loss was recognized for the three and six months ended July 31, 2021.

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MONGODB, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Refer to Note 2, Summary of Significant Accounting Policies, in the Notes to Consolidated Financial Statements included in Part II, Item 8 of the Company’s 2022 Form 10-K for further information. The Company considers these assets as Level 3 within the fair value hierarchy. The estimation of fair value for these investments is inherently complex due to the lack of readily available market data and inherent lack of liquidity and requires the Company’s judgment and the use of significant unobservable inputs in an inactive market. In addition, the determination of whether an orderly transaction is for the identical or a similar investment requires significant management judgment, including understanding the differences in the rights and obligations of the investments, the extent to which those differences would affect the fair values of those investments and the stage of operational development of the entities.

4. Goodwill and Acquired Intangible Assets, Net

There were no material changes to goodwill carrying amounts during the six months ended July 31, 2022. The gross carrying amounts and accumulated amortization of the Company’s intangible assets were as follows (in thousands):


	July 31, 2022
	Gross Carrying Value		Accumulated Amortization		Net Book Value		Weighted-Average Remaining Useful Life (in years)
Developed technology	$	38,100	$	(26,052)	$	12,048	2.2
Customer relationships	15,200		(11,230)		3,970		1.3
Total	$	53,300	$	(37,282)	$	16,018


	January 31, 2022
	Gross Carrying Value		Accumulated Amortization		Net Book Value		Weighted-Average Remaining Useful Life (in years)
Developed technology	$	38,100	$	(22,982)	$	15,118	2.6
Customer relationships	15,200		(9,710)		5,490		1.8
Total	$	53,300	$	(32,692)	$	20,608

Acquired intangible assets are amortized on a straight-line basis. Amortization expense of intangible assets was $2.3 million and $4.6 million for the three and six months ended July 31, 2022, respectively, and $2.3 million and $4.5 million for the three and six months ended July 31, 2021, respectively. Amortization expense for developed technology was included as research and development expense in the Company’s condensed consolidated statements of operations. Amortization expense for customer relationships was included as sales and marketing expense in the Company’s interim unaudited condensed consolidated statements of operations.

As of July 31, 2022, future amortization expense related to the intangible assets is as follows (in thousands):


Years Ending January 31,
Remainder of 2023	$	4,590
2024	8,505
2025	2,130
2026	680
2027	113

Total	$	16,018

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MONGODB, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

5. Convertible Senior Notes

The net carrying amounts of the Company’s convertible notes were as follows for the periods presented (in thousands):


	July 31, 2022		January 31, 2022
	2026 Notes		2026 Notes
Principal	$	1,149,982	$	1,149,988

Unamortized debt issuance costs	(11,782)		(13,467)
Net carrying amount	$	1,138,200	$	1,136,521

As of July 31, 2022, the estimated fair value (Level 2) of the outstanding 2026 Notes (as defined herein), which is utilized solely for disclosure purposes, was approximately $1.8 billion. The fair value was determined based on the closing trading price per $100 of the 2026 Notes as of the last day of trading for the period. The fair value of the 2026 Notes is primarily affected by the trading price of the Company’s common stock and market interest rates.

In January 2020, the Company issued $1.0 billion aggregate principal amount of 0.25% convertible senior notes due 2026 in a private placement and, also in January 2020, the Company issued an additional $150.0 million aggregate principal amount of convertible senior notes pursuant to the exercise in full of the initial purchasers’ option to purchase additional convertible senior notes (collectively, the “2026 Notes”). The 2026 Notes are senior unsecured obligations of the Company and interest is payable semiannually in arrears on July 15 and January 15 of each year, beginning on July 15, 2020, at a rate of 0.25% per year. The 2026 Notes will mature on January 15, 2026, unless earlier converted, redeemed or repurchased. The total net proceeds from the offering, after deducting initial purchase discounts and estimated debt issuance costs, were approximately $1.13 billion.

Refer to Note 6, Convertible Senior Notes, in the Notes to Consolidated Financial Statements included in Part II, Item 8 of the Company’s 2022 Form 10-K for further information on the 2026 Notes.

During the three months ended July 31, 2022, the conditional conversion feature of the 2026 Notes was triggered as the last reported sale price of the Company's common stock was more than or equal to 130% of the conversion price for at least 20 trading days in the period of 30 consecutive trading days ending on July 31, 2022 (the last trading day of the fiscal quarter) and therefore the 2026 Notes are currently convertible, in whole or in part, at the option of the holders from August 1, 2022 through October 31, 2022. Whether the 2026 Notes will be convertible following such period will depend on the continued satisfaction of this condition or another conversion condition in the future.

During the three and six months ended July 31, 2022, certain holders elected to redeem an immaterial aggregate principal amount of the 2026 Notes. The Company elected to settle the redemption through the issuance of common stock. The Company may elect to repay the 2026 Notes in cash, shares of the Company’s common stock or a combination of both cash and shares with respect to future conversions of the 2026 Notes.

Capped Calls

In connection with the pricing of the issuance of our convertible notes due June 15, 2024 (the “2024 Notes”) and the 2026 Notes, the Company entered into privately negotiated capped call transactions with certain counterparties (the “Capped Calls”). The Capped Calls associated with the 2024 Notes each have an initial strike price of approximately $68.15 per share, subject to certain adjustments, which corresponded to the initial conversion price of the 2024 Notes. These Capped Calls have initial cap prices of $106.90 per share, subject to certain adjustments.

The Capped Calls associated with the 2026 Notes each have an initial strike price of approximately $211.20 per share, subject to certain adjustments, which corresponds to the initial conversion price of the 2026 Notes. These Capped Calls have initial cap prices of $296.42 per share, subject to certain adjustments. The Company did not unwind any of its Capped Calls through July 31, 2022.

Refer to Note 6, Convertible Senior Notes, in the Notes to Consolidated Financial Statements included in Part II, Item 8 of the Company’s 2022 Form 10-K for further information on the Capped Calls and the 2024 Notes.

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MONGODB, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6. Leases

The Company has entered into non-cancelable operating and finance lease agreements, principally real estate for office space globally. The Company may receive renewal or expansion options, leasehold improvement allowances or other incentives on certain lease agreements. Lease terms range from one to 12 years and may include renewal options, which the company deems reasonably certain to be renewed. The exercise of the lease renewal option is at the company's discretion.

The Company entered into a new agreement to lease office space in Gurgaon, India for a term of five years with total estimated aggregate base rent payments of $7.0 million. This lease commenced and payments began in April 2022.

Lease Costs

The components of the Company’s lease costs included in its interim unaudited condensed consolidated statement of operations were as follows (in thousands):


	Three Months Ended July 31,				Six Months Ended July 31,
	2022		2021		2022		2021
Finance lease cost:
Amortization of finance lease right-of-use assets	$	993	$	994	$	1,987	$	1,988
Interest on finance lease liabilities	732		802		1,482		1,621
Operating lease cost	3,051		2,261		5,615		4,168
Short-term lease cost	605		133		1,142		199
Total lease cost	$	5,381	$	4,190	$	10,226	$	7,976

Balance Sheet Components

The balances of the Company’s finance and operating leases were recorded on the condensed consolidated balance sheet as follows (in thousands):


	July 31, 2022		January 31, 2022
Finance Lease:
Property and equipment, net	$	29,476	$	31,463
Other accrued liabilities (current)	5,331		4,511
Other liabilities, non-current	46,470		49,173
Operating Leases:
Operating lease right-of-use assets	$	46,418	$	41,745
Operating lease liabilities (current)	9,163		8,084
Operating lease liabilities, non-current	40,437		38,707

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MONGODB, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Supplemental Information

The following table presents supplemental information related to the Company’s finance and operating leases (in thousands, except weighted-average information):


	Six Months Ended July 31,
		2022			2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance lease		$	1,482		$	1,621
Operating cash flows from operating leases		5,706			3,626
Financing cash flows from finance lease		1,882			2,415
Right-of-use assets obtained in exchange for lease obligations:
Operating leases		$	9,649		$	12,073
Weighted-average remaining lease term as of period end (in years):
Finance lease		7.4			8.4
Operating leases		6.1			7.7
Weighted-average discount rate:
Finance lease		5.6		%	5.6		%
Operating leases		5.2		%	4.3		%

Maturities of Lease Liabilities

Future minimum lease payments under non-cancelable finance and operating leases on an annual undiscounted cash flow basis as of July 31, 2022 were as follows (in thousands):


Year Ending January 31,	Finance Lease		Operating Leases
Remainder of 2023	$	4,037	$	5,680
2024	8,073		11,885
2025	8,445		10,184
2026	8,711		7,904
2027	8,711		6,023
Thereafter	25,407		16,507
Total minimum payments	63,384		58,183
Less imputed interest	(11,583)		(8,583)
Present value of future minimum lease payments	51,801		49,600
Less current obligations under leases	(5,331)		(9,163)
Non-current lease obligations	$	46,470	$	40,437

7. Commitments and Contingencies

Non-cancelable Material Commitments

During the six months ended July 31, 2022, other than certain non-cancelable operating leases described in Note 6, Leases, there have been no material changes outside the ordinary course of business to the Company’s contractual obligations and commitments from those disclosed in the 2022 Form 10-K.

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MONGODB, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Legal Matters

From time to time, the Company has become involved in claims, litigation and other legal matters arising in the ordinary course of business, including intellectual property claims, labor and employment claims and breach of contract claims. For example, on March 12, 2019, Realtime Data LLC (“Realtime”) filed a lawsuit against the Company in the United States District Court for the District of Delaware alleging that the Company is infringing three U.S. patents that it holds: U.S. Patent No. 9,116,908, U.S. Patent No. 9,667,751 and U.S. Patent No. 8,933,825. On May 4, 2021, in a consolidated action that includes Realtime's case against MongoDB, the District Court granted certain defendants' motion to dismiss without prejudice, finding that the patents are invalid under 35 U.S.C. § 101. Realtime filed an amended complaint against the Company on May 18, 2021, and the Company moved to dismiss that amended complaint on June 29, 2021. On August 23, 2021, the District Court granted the Company's motion to dismiss. On August 25, 2021, Realtime filed a notice of appeal of the Delaware District Court’s order. Realtime filed its appellate brief on December 2, 2021 and the defendants (including MongoDB) filed a responsive brief on March 11, 2022. Realtime filed a reply brief on April 29, 2022. The oral argument has not yet been scheduled.

The Company investigates all claims, litigation and other legal matters as they arise. Although claims and litigation are inherently unpredictable, as of July 31, 2022 and January 31, 2022, the Company is currently not aware of any matters that, if determined adversely to the Company, would individually or taken together have a material adverse effect on its business, financial position, results of operations or cash flows. The Company accrues estimates for resolution of legal and other contingencies when losses are probable and estimable. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors.

Indemnification

The Company enters into indemnification provisions under its agreements with other companies in the ordinary course of business, including business partners, landlords, contractors and parties performing its research and development. Pursuant to these arrangements, the Company agrees to indemnify, hold harmless and reimburse the indemnified party for certain losses suffered or incurred by the indemnified party as a result of the Company’s activities. The terms of these indemnification agreements are generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable. The Company has never incurred costs to defend lawsuits or settle claims related to these indemnification agreements. As a result, the Company believes the fair value of these agreements is not material. The Company maintains commercial general liability insurance and product liability insurance to offset certain of the Company’s potential liabilities under these indemnification provisions.

The Company has entered into indemnification agreements with each of its directors and executive officers. These agreements require the Company to indemnify such individuals, to the fullest extent permitted by Delaware law, for certain liabilities to which they may become subject as a result of their affiliation with the Company.

8. Revenue

Disaggregation of Revenue

Based on the information provided to and reviewed by the Company’s Chief Executive Officer (“CEO”), its Chief Operating Decision Maker, the Company believes that the nature, amount, timing and uncertainty of its revenue and cash flows and how they are affected by economic factors is most appropriately depicted through the Company’s primary geographical markets and subscription product categories. The Company’s primary geographical markets are North and South America (“Americas”); Europe, Middle East and Africa (“EMEA”); and Asia Pacific. The Company also disaggregates its subscription products between its MongoDB Atlas-related offerings and other subscription products, which include MongoDB Enterprise Advanced.

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MONGODB, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following table presents the Company’s revenues disaggregated by primary geographical markets, subscription product categories and services (in thousands):


	Three Months Ended July 31,				Six Months Ended July 31,
	2022		2021		2022		2021
Primary geographical markets:
Americas	$	185,796	$	120,827	$	359,852	$	230,303
EMEA	84,627		57,582		166,596		112,307
Asia Pacific	33,237		20,338		62,659		37,785
Total	$	303,660	$	198,747	$	589,107	$	380,395

Subscription product categories and services:
MongoDB Atlas-related	$	193,354	$	111,756	$	363,349	$	205,267
Other subscription	98,253		79,625