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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 April 30, 2021
OR
    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)
___________________
Delaware26-1463205
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
1633 Broadway,38th Floor
New York,NY10019
(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 classTrading Symbol(s)Name of each exchange on which registered
Class A Common Stock, par value $0.001 per shareMDBThe 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 filerSmaller 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 June 1, 2021, there were 62,140,090 shares of the registrant’s Class A common stock, par value $0.001 per share, outstanding.



Table of Contents
 
Page




PART I—FINANCIAL INFORMATION
ITEM 1.    FINANCIAL STATEMENTS.
MONGODB, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
(unaudited)
April 30, 2021January 31, 2021
Assets
Current assets:
Cash and cash equivalents $407,055 $429,697 
Short-term investments 527,988 528,045 
Accounts receivable, net of allowance for doubtful accounts of $4,404 and $6,024 as of April 30, 2021 and January 31, 2021, respectively
100,646 135,176 
Deferred commissions 39,595 36,619 
Prepaid expenses and other current assets
20,738 12,350 
Total current assets 1,096,022 1,141,887 
Property and equipment, net 60,906 62,364 
Operating lease right-of-use assets45,019 34,587 
Goodwill 57,775 55,830 
Acquired intangible assets, net27,493 26,275 
Deferred tax assets 1,006 997 
Other assets
89,406 85,555 
Total assets
$1,377,627 $1,407,495 
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable $4,358 $4,144 
Accrued compensation and benefits 59,482 70,210 
Operating lease liabilities6,432 2,343 
Other accrued liabilities 27,369 56,440 
Deferred revenue
231,040 221,404 
Total current liabilities 328,681 354,541 
Deferred tax liability, non-current 73 773 
Operating lease liabilities, non-current
45,835 39,095 
Deferred revenue, non-current
17,263 16,547 
Convertible senior notes, net
1,192,488 937,729 
Other liabilities, non-current
61,651 59,129 
Total liabilities
1,645,991 1,407,814 
Commitments and contingencies (Note 7)
Temporary equity, convertible senior notes 4,714 
Stockholders’ deficit:
Class A common stock, par value of $0.001 per share; 1,000,000,000 shares authorized as of April 30, 2021 and January 31, 2021; 62,195,644 shares issued and 62,096,273 shares outstanding as of April 30, 2021; 60,997,822 shares issued and 60,898,451 shares outstanding as of January 31, 2021
62 61 
Additional paid-in capital 680,413 932,332 
Treasury stock, 99,371 shares (repurchased at an average of $13.27 per share) as of April 30, 2021 and January 31, 2021
(1,319)(1,319)
Accumulated other comprehensive loss(760)(704)
Accumulated deficit
(946,760)(935,403)
Total stockholders’ deficit
(268,364)(5,033)
Total liabilities, temporary equity and stockholders’ deficit
$1,377,627 $1,407,495 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
1

MONGODB, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(unaudited)
Three Months Ended April 30,
20212020
Revenue:
Subscription
$174,570 $124,856 
Services
7,078 5,473 
Total revenue
181,648 130,329 
Cost of revenue:
Subscription
45,402 30,625 
Services
9,126 7,052 
Total cost of revenue
54,528 37,677 
Gross profit
127,120 92,652 
Operating expenses:
Sales and marketing
97,890 69,125 
Research and development
64,751 45,632 
General and administrative
25,925 19,935 
Total operating expenses
188,566 134,692 
Loss from operations
(61,446)(42,040)
Other income (expense):
Interest income
173 2,727 
Interest expense
(3,658)(13,795)
Other expense, net
(437)(625)
Loss before provision for (benefit from) income taxes
(65,368)(53,733)
Provision for (benefit from) income taxes
(1,376)234 
Net loss
$(63,992)$(53,967)
Net loss per share, basic and diluted
$(1.04)$(0.94)
Weighted-average shares used to compute net loss per share, basic and diluted
61,361,670 57,649,524 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
2

MONGODB, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(in thousands)
(unaudited)
Three Months Ended April 30,
20212020
Net loss
$(63,992)$(53,967)
Other comprehensive income (loss), net of tax:
Unrealized gain on available-for-sale securities 34 848 
Foreign currency translation adjustment
(90)(75)
Other comprehensive income (loss)
(56)773 
Total comprehensive loss
$(64,048)$(53,194)
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
3

MONGODB, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)
(in thousands, except share data)
(unaudited)
Class A Common Stock
Additional Paid-In Capital
Treasury Stock
Accumulated Other Comprehensive Loss
Accumulated Deficit
Total Stockholders’ Deficit
Shares
Amount
Balances as of January 31, 202160,898,451 $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 2024 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, 202162,096,273 $62 $680,413 $(1,319)$(760)$(946,760)$(268,364)
Class A and
Class B
Common Stock
Additional Paid-In Capital
Treasury Stock
Accumulated Other Comprehensive Income
Accumulated Deficit
Total Stockholders’ Equity (Deficit)
Shares
Amount
Balances as of January 31, 202057,382,543 $57 $752,127 $(1,319)$225 $(668,232)$82,858 
Cumulative effect of accounting change
— — — — — (227)(227)
Stock option exercises
373,394 1 2,994 — — — 2,995 
Repurchase of early exercised options
(79)— — — — — — 
Vesting of early exercised stock options
— — 42 — — — 42 
Vesting of restricted stock units
241,569 — — — — — — 
Stock-based compensation
— — 30,567 — — — 30,567 
Conversion of 2024 convertible senior notes8 — — — — — — 
Unrealized gain on available-for-sale securities
— — — — 848 — 848 
Foreign currency translation adjustment
— — — — (75)— (75)
Net loss
— — — — — (53,967)(53,967)
Balances as of April 30, 202057,997,435 $58 $785,730 $(1,319)$998 $(722,426)$63,041 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4

MONGODB, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended April 30,
20212020
Cash flows from operating activities
Net loss
$(63,992)$(53,967)
Adjustments to reconcile net loss to net cash provided by (used) in operating activities:
Depreciation and amortization
3,251 2,864 
Stock-based compensation
50,914 30,567 
Amortization of debt discount and issuance costs
1,427 12,023 
Amortization of finance right-of-use assets
994 994 
Amortization of operating right-of-use assets
1,522 1,372 
Deferred income taxes
(1,585)(290)
Accretion of discount on short-term investments
1,527 (193)
Unrealized foreign exchange loss315  
Change in operating assets and liabilities:
Accounts receivable
35,145 3,637 
Prepaid expenses and other current assets
(9,027)234 
Deferred commissions
(5,882)(3,063)
Other long-term assets
23 (170)
Accounts payable
224 219 
Accrued liabilities
(17,152)(2,779)
Operating lease liabilities
(1,027)(1,126)
Deferred revenue
9,749 3,349 
Other liabilities, non-current
3,791 451 
Net cash provided by (used in) operating activities 10,217 (5,878)
Cash flows from investing activities
Purchases of property and equipment
(627)(1,505)
Acquisition, net of cash acquired
(4,469) 
Investment in non-marketable securities(936) 
Proceeds from maturities of marketable securities
100,000 165,000 
Purchases of marketable securities
(101,479)(160,283)
Net cash provided by (used in) investing activities
(7,511)3,212 
Cash flows from financing activities
Payments of issuance costs for convertible senior notes
 (4,154)
Proceeds from exercise of stock options, including early exercised stock options
3,539 3,000 
Repurchase of early exercised stock options
 (1)
Principal repayments of finance leases
(1,199)(1,135)
Repayments of convertible senior notes attributable to principal
(27,594) 
Net cash used in financing activities (25,254)(2,290)
Effect of exchange rate changes on cash, cash equivalents and restricted cash
(94)(593)
Net decrease in cash, cash equivalents and restricted cash (22,642)(5,549)
Cash, cash equivalents and restricted cash, beginning of period
430,222 706,706 
Cash, cash equivalents and restricted cash, end of period
$407,580 $701,157 
Supplemental cash flow disclosure
Cash paid during the period for:
Income taxes, net of refunds
$995 $553 
Interest expense
$819 $884 
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
$407,055 $700,645 
Restricted cash, non-current
525 512 
Total cash, cash equivalents and restricted cash
$407,580 $701,157 
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5

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 its software, the Company provides post-contract support, training and consulting services for its offerings. The Company’s fiscal year ends January 31.
2. Summary of Significant Accounting Policies
Basis of Presentation
The accompanying interim condensed consolidated balance sheet as of April 30, 2021, the interim condensed consolidated statements of stockholders’ equity (deficit) for the three months ended April 30, 2021 and 2020, the interim condensed consolidated statements of operations and of comprehensive loss for the three months ended April 30, 2021 and 2020 and the interim condensed consolidated statements of cash flows for the three months ended April 30, 2021 and 2020 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 April 30, 2021, its statements of stockholders’ equity (deficit) as of April 30, 2021 and 2020, its results of operations and of comprehensive loss for the three months ended April 30, 2021 and 2020 and its statements of cash flows for the three months ended April 30, 2021 and 2020. The financial data and the other financial information disclosed in the notes to these interim condensed consolidated financial statements related to the three-month periods are also unaudited. The results of operations for the three months ended April 30, 2021 are not necessarily indicative of the results to be expected for the fiscal year ending January 31, 2022 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, 2021 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, 2021 (the “2021 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, 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, fair value of common stock prior to the initial public offering, 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 has resulted in a global slowdown of economic activity that is likely to continue to decrease demand for a broad variety of goods and services, including from the Company’s customers, while also disrupting sales channels and marketing activities for an unknown period of time. The Company currently expects its revenue to continue to be negatively impacted by the slowdown in activity and other challenges associated with the ongoing COVID-19 pandemic in the near-term.
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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 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.
Related Party Transactions
All contracts with related parties are executed in the ordinary course of business. There were no material related party transactions in the three months ended April 30, 2021 and 2020. As of April 30, 2021 and January 31, 2021, there were no material amounts payable to or amounts receivable from related parties.
Significant Accounting Policies
There have been no changes to the Company’s significant accounting policies as described in the Company’s 2021 Form 10-K other than as a result of the Company’s adoption of the new accounting guidance related to convertible instruments, effective February 1, 2021, as discussed in “Recently Adopted Accounting Pronouncements—Convertible Senior Notes” below.
Recently Adopted Accounting Pronouncements
Convertible Senior Notes. In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06—Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”). The new standard simplifies the accounting for convertible instruments by eliminating the conversion option separation model for convertible debt that can be settled in cash and by eliminating the measurement model for beneficial conversion features. Convertible instruments that continue to be subject to separation models are (1) those with conversion options that are required to be accounted for as bifurcated derivatives and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. Additionally, among other changes, the new guidance eliminates some of the conditions for equity classification for contracts in an entity’s own equity, thereby making it easier for equity contracts to qualify for the derivative scope exception. The new standard also requires entities to use the if-converted method for all convertible instruments in the diluted earnings per share calculation and include the effect of share settlement for instruments that may be settled in cash or shares, except for certain liability-classified share-based payment awards.
The Company early adopted ASU 2020-06 as of February 1, 2021 using the modified retrospective transition method. Upon adoption of ASU 2020-06, the Company is no longer recording the conversion feature of its convertible senior notes in equity. Instead, the Company combined the previously separated equity component with the liability component, which together is now classified as debt, thereby eliminating the subsequent amortization of the debt discount as interest expense. Similarly, the portion of issuance costs previously allocated to equity was reclassified to debt and amortized as interest expense. Accordingly, the Company recorded a decrease to accumulated deficit of $52.6 million, a decrease to additional paid-in capital of $309.4 million, a decrease to temporary equity of $4.7 million and an increase to convertible senior notes, net of $261.5 million. There was an immaterial benefit from the reversal of the deferred tax liability associated with the convertible senior notes upon the adoption of ASU 2020-06. Prior period financial statements were not restated.
Also upon adoption, the Company is no longer utilizing the treasury stock method for earnings per share purposes. Instead, the Company is applying the if-converted method when reporting the number of potentially dilutive shares of common stock. Although the required use of the if-converted method will not impact the diluted net loss per share as long as the Company is in a net loss position, the Company is required to include disclosures of all the underlying shares regardless of the average stock price for the reporting period.
The Company’s convertible senior notes are classified as non-current liabilities until the reporting period date is within one year of maturity of the convertible senior notes or when the Company has received a redemption request, but settlement will occur after the reporting period date. Under such circumstances, the carrying amount of the convertible senior notes, net of the associated unamortized debt issuance costs, is classified as a current liability.
Income Taxes. In December 2019, the FASB issued ASU 2019-12—Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The amendments in ASU 2019-12 simplify the accounting for income taxes by removing
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

certain exceptions to the general principles in Topic 740. The amendments also improve consistent application and simplification of GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The Company adopted ASU 2019-12 effective February 1, 2021 and the adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements.
3. Fair Value Measurements
The following tables present information about the Company’s financial assets and liabilities that have been measured at fair value on a recurring basis as of April 30, 2021 and January 31, 2021 and indicate the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):
Fair Value Measurement as of April 30, 2021
Level 1
Level 2
Level 3
Total
Financial Assets:
Cash and cash equivalents:
Money market funds $279,453 $ $ $279,453 
Short-term investments:
U.S. government treasury securities
527,989   527,989 
Total financial assets
$807,442 $ $ $807,442 
Fair Value Measurement as of January 31, 2021
Level 1
Level 2
Level 3
Total
Financial Assets:
Cash and cash equivalents:
Money market funds $330,109 $ $ $330,109 
Short-term investments:
U.S. government treasury securities
528,045   528,045 
Total financial assets
$858,154 $ $ $858,154 
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 April 30, 2021 and January 31, 2021. As of April 30, 2021 and January 31, 2021, gross unrealized gains and losses for cash equivalents and short-term investments were not material. Accordingly, the Company concluded that an allowance for credit losses was unnecessary for short-term investments as of April 30, 2021. Gross realized gains and losses were immaterial for each of the three month periods ended April 30, 2021 and 2020.
Convertible Senior Notes
In addition to its cash, cash equivalents and short-term investments, 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 April 30, 2021 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 April 30, 2021 and January 31, 2021, the total amount of non-marketable equity securities included in other assets on the Company’s condensed consolidated balance sheets was $1.4 million and $0.5 million. During the three months ended April 30, 2021, the Company invested an additional $0.9 million in cash in non-marketable equity securities. 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 2021 Form 10-K for further information. The Company classifies these assets as Level 3 within the fair value hierarchy only if an impairment or observable price changes in orderly transactions are recognized on these non-marketable equity securities during the period. 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
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

investments and the stage of operational development of the entities. For the three months ended April 30, 2021, there have been no adjustments to the carrying values of the Company’s non-marketable securities as a result of impairment or observable price changes.
4. Goodwill and Acquired Intangible Assets, Net
During the three months ended April 30, 2021, the Company made an acquisition for total cash consideration of $9.0 million, of which $4.5 million was the purchase price to be allocated and $4.5 million will be recognized as post-combination compensation expense. For accounting purposes, this business combination was deemed immaterial. The Company allocated $3.4 million to the acquired developed technology intangible asset based on fair value to be amortized over its economic useful life of five years. The Company also recorded $1.9 million to goodwill, which included a tax benefit associated with the acquisition due to the release of the valuation allowance of $0.8 million. The gross carrying amount and accumulated amortization of the Company’s intangible assets are as follows (in thousands):
April 30, 2021
Gross Carrying ValueAccumulated AmortizationNet Book Value
Developed technology$38,100 $(18,377)$19,723 
Customer relationships15,200 (7,430)7,770 
Total$53,300 $(25,807)$27,493 
January 31, 2021
Gross Carrying ValueAccumulated AmortizationNet Book Value
Developed technology$34,700 $(16,955)$17,745 
Customer relationships15,200 (6,670)8,530 
Total$49,900 $(23,625)$26,275 
Acquired intangible assets are amortized on a straight-line basis. As of April 30, 2021, the weighted-average remaining useful lives of identifiable, acquisition-related intangible assets was 3.3 years for developed technology and 2.6 years for customer relationships. Amortization expense of intangible assets was $2.2 million for the three months ended April 30, 2021. 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 condensed consolidated statements of operations.
As of April 30, 2021, future amortization expense related to the intangible assets is as follows (in thousands):
Years Ending January 31,
Remainder of 2022$6,885 
20239,180 
20248,505 
20252,130 
2026680 
2027113 
Total$27,493 
5. Convertible Senior Notes
In June 2018, the Company issued $250.0 million aggregate principal amount of 0.75% convertible senior notes due 2024 in a private placement and, in July 2018, the Company issued an additional $50.0 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 “2024 Notes”). The 2024 Notes are senior unsecured obligations of the Company and interest is payable semiannually in arrears on June 15 and December 15 of each year, beginning on December 15, 2018, at a rate of 0.75% per year. The 2024 Notes will mature on June 15, 2024, unless earlier converted, redeemed or repurchased. The total net proceeds from the offering, after deducting initial purchase discounts and debt issuance costs, were approximately $291.1 million.
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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.
On January 14, 2020, in connection with the issuance of the 2026 Notes, the Company used a portion of the net proceeds to repurchase $210.0 million aggregate principal amount of the 2024 Notes (the “2024 Notes Partial Repurchase”) leaving $90.0 million aggregate principal outstanding on the 2024 Notes immediately after the exchange. The 2024 Notes Partial Repurchase were not pursuant to a redemption notice and were individually privately negotiated transactions. The 2024 Notes Partial Repurchase and issuance of the 2026 Notes were deemed to have substantially different terms due to the significant difference between the value of the conversion option immediately prior to and after the exchange, and accordingly, the 2024 Notes Partial Repurchase was accounted for as a debt extinguishment.
Refer to Note 6, Convertible Senior Notes, in the Notes to Consolidated Financial Statements included in Part II, Item 8 of the Company’s 2021 Form 10-K for further information on the 2024 Notes, the 2026 Notes and the 2024 Notes Partial Repurchase.
During the three months ended April 30, 2021, the conditional conversion feature of the 2024 Notes and the 2026 Notes was triggered as the last reported sale price of the Company's Class A common stock was more than or equal to 130% of the applicable conversion price for each of the series of convertible senior notes for at least 20 trading days in the period of 30 consecutive trading days ending on April 30, 2021 (the last trading day of the fiscal quarter) and therefore the 2024 Notes and the 2026 Notes are currently convertible, in whole or in part, at the option of the holders from May 1, 2021 through July 31, 2021. Whether the 2024 Notes or 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 months ended April 30, 2021, the Company converted $30.6 million aggregate principal amount of the 2024 Notes to certain holders. Pursuant to the Company’s adoption of ASU 2020-06, there was no gain nor loss recognized upon these conversions. The difference between the settlement consideration and the liability component of the redeemed 2024 Notes was recorded to additional paid-in capital on the Company’s condensed consolidated balance sheet. Although the Company used $27.6 million of cash to repay a portion of the principal upon redemption, the Company may continue to elect to repay the 2024 Notes and the 2026 Notes in cash, shares of the Company’s Class A common stock or a combination of both cash and shares with respect to future conversions of the 2024 Notes and the 2026 Notes.
The net carrying amounts of the liability component of the 2024 Notes and the 2026 Notes were as follows (in thousands):
April 30, 2021
2024 Notes2026 Notes
Principal$59,405 $1,150,000 
Unamortized debt issuance costs(931)(15,986)
Net carrying amount (1)
$58,474 $1,134,014 
(1) The net carrying amount was increased on February 1, 2021 as a result of the adoption of ASU 2020-06. Refer to Note 2, Summary of Significant Accounting Policies, in this Quarterly Report on Form 10-Q for further information.
As of April 30, 2021, the total estimated fair values (Level 2) of the outstanding 2024 Notes and the 2026 Notes were approximately $260.5 million and $1.79 billion, respectively. The fair values were determined based on the closing trading price per $100 of the 2024 Notes and 2026 Notes as of the last day of trading for the period. The fair values of the 2024 Notes and 2026 Notes are primarily affected by the trading price of the Company’s Class A common stock and market interest rates.
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following table sets forth the interest expense related to the 2024 Notes and 2026 Notes (in thousands):
Three Months Ended April 30,
20212020
2024 Notes
2026 Notes
2024 Notes
2026 Notes
Contractual interest expense$132 $718 $169 $719 
Amortization of debt discount (1)
  970 10,547 
Amortization of issuance costs (1)
87 837 65 441 
Total (1)
$219 $1,555 $1,204 $11,707 
(1) The decrease in total interest expense for the period ended April 30, 2021 was due to the derecognition of the unamortized debt discount, partially offset by the increase in the amortization of issuance costs previously recognized in equity. These changes were the result of the Company’s adoption of ASU 2020-06, as of February 1, 2021, as described in Note 2, Summary of Significant Accounting Policies.
Capped Calls
In connection with the pricing of the 2024 Notes and 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 corresponds 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.
Refer to Note 6, Convertible Senior Notes, in the Notes to Consolidated Financial Statements included in Part II, Item 8 of the Company’s 2021 Form 10-K for further information on the Capped Calls.
6. Leases
Finance Lease
In December 2017, the Company entered into a lease agreement for 106,230 rentable square feet of office space (the “Premises”) to accommodate its growing employee base in New York City. The Company received delivery of the Premises on January 1, 2018 to commence construction to renovate the Premises. Total estimated aggregate base rent payments over the initial 12-year term of the lease are $87.3 million and payments began in July 2019. The Company has the option to extend the term of the lease by an additional 5 years.
Operating Leases
The Company has entered into non-cancelable operating leases, primarily related to rental of office space expiring through 2032. The Company recognizes operating lease costs on a straight-line basis over the term of the agreement, taking into account adjustments for market provisions such as free or escalating base monthly rental payments or deferred payment terms such as rent holidays that defer the commencement date of the required payments. The Company may receive renewal or expansion options, leasehold improvement allowances or other incentives on certain lease agreements.
The Company entered into a new agreement to lease approximately 16,000 square feet of office space in Palo Alto for a term of eight years with one option to extend for an additional five years. The total estimated aggregate base rent payments are $14.2 million with payments beginning four months subsequent to the commencement date, which was April 13, 2021.
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Lease Costs
The components of the Company’s lease costs included in its condensed consolidated statement of operations were as follows (in thousands):
Three Months Ended April 30,
20212020
Finance lease cost:
Amortization of finance lease right-of-use assets$994 $994 
Interest on finance lease liabilities819 884 
Operating lease cost1,907 1,823 
Short-term lease cost66 793 
Total lease cost$3,786 $4,494 
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):
April 30, 2021January 31, 2021
Finance Lease:
Property and equipment, net$34,444 $35,437 
Other accrued liabilities (current)4,297 4,900 
Other liabilities, non-current53,087 54,356 
Operating Leases:
Operating lease right-of-use assets$45,019 $34,587 
Operating lease liabilities (current)6,432 2,343 
Operating lease liabilities, non-current45,835 39,095 
Supplemental Information
The following table presents supplemental information related to the Company’s finance and operating leases (in thousands, except weighted-average information):
Three Months Ended April 30,
20212020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance lease$819 $884 
Operating cash flows from operating leases1,506 1,297 
Financing cash flows from finance lease1,199 1,135 
Right-of-use assets obtained in exchange for lease obligations:
Operating leases$11,924 $23,375 
Weighted-average remaining lease term (in years):
Finance lease8.79.7
Operating leases7.98.7
Weighted-average discount rate:
Finance lease5.6 %5.6 %
Operating leases4.3 %5.0 %
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Maturities of Lease Liabilities
Future minimum lease payments under non-cancelable finance and operating leases on an annual undiscounted cash flow basis as of April 30, 2021 were as follows (in thousands):
Year Ending January 31,
Finance Lease
Operating Leases
Remainder of 2022$5,382 $6,153 
20238,0739,656
20248,0738,778
20258,4457,729
20268,711 6,219 
Thereafter
34,11823,354
Total minimum payments
72,802 61,889 
Less imputed interest
(15,418)(9,622)
Present value of future minimum lease payments
57,384 52,267 
Less current obligations under leases
(4,297)(6,432)
Non-current lease obligations
$53,087 $45,835 
7. Commitments and Contingencies
Non-cancelable Material Commitments
During the three months ended April 30, 2021, 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 2021 Form 10-K.
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 (“Realtime”) filed a lawsuit against the Company (the “Realtime Lawsuit”) 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 (the “908 Patent”), U.S. Patent No. 9,667,751 (the “751 Patent”) and U.S. Patent No. 8,933,825 (the “825 Patent”). The patent infringement allegations in the lawsuit relate to data compression, decompression, storage and retrieval. Realtime seeks monetary damages and injunctive relief. On May 4, 2021, in a separate action involving the same three Patents, the District Court granted the 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 intends to respond in due course. 
The Company investigates all claims, litigation and other legal matters as they arise. Although claims and litigation are inherently unpredictable, 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. Although the results of claims and litigation are inherently unpredictable, the Company believes that there was less than a reasonable possibility that the Company had incurred a material loss with respect to such loss contingencies, as of April 30, 2021 and January 31, 2021; therefore, the Company has not recorded an accrual for such contingencies.
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
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

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, 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 includes MongoDB Enterprise Advanced.
The following table presents the Company’s revenues disaggregated by primary geographical markets, subscription product categories and services (in thousands):
Three Months Ended April 30,
20212020
Primary geographical markets:
Americas
$109,476 $81,538 
EMEA
54,725 39,009 
Asia Pacific
17,447 9,782 
Total
$181,648 $130,329 
Subscription product categories and services:
MongoDB Atlas-related
$93,510 $54,170 
Other subscription
81,060 70,686 
Services
7,078 5,473 
Total
$181,648 $130,329 
Customers located in the United States accounted for 55% of total revenue for the three months ended April 30, 2021 and 58% of total revenue for the three months ended April 30, 2020. No other country accounted for 10% or more of revenue for the periods presented.
Contract Liabilities
The Company’s contract liabilities are recorded as deferred revenue in the Company’s condensed consolidated balance sheet and consists of customer invoices issued or payments received in advance of revenues being recognized from the Company’s subscription and services contracts. Deferred revenue, including current and non-current balances, as of April 30, 2021 and January 31, 2021 was $248.3 million and $238.0 million, respectively. Approximately 42% and 52% of the total revenue recognized for the three months ended April 30, 2021 and 2020, respectively, was from deferred revenue at the beginning of each respective period.
Remaining Performance Obligations
Remaining performance obligations represent the aggregate amount of the transaction price in contracts allocated to performance obligations not delivered, or partially undelivered, as of the end of the reporting period. Remaining performance obligations include unearned revenue, multi-year contracts with future installment payments and certain unfulfilled orders against accepted customer contracts at the end of any given period. As of April 30, 2021, the aggregate transaction price
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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

allocated to remaining performance obligations was $284.1 million. Approximately 56% is expected to be recognized as revenue over the next 12 months and the remainder thereafter. The Company applies the practical expedient to omit disclosure with respect to the amount of the transaction price allocated to remaining performance obligations if the related contract has a total duration of 12 months or less.
Unbilled Receivables
Revenue recognized in excess of invoiced amounts creates an unbilled receivable, which represents the Company’s unconditional right to consideration in exchange for goods or services that the Company has transferred to the customer. Unbilled receivables were recorded as part of accounts receivable, net in the Company’s condensed consolidated balance sheets. As of April 30, 2021 and January 31, 2021, unbilled receivables were $4.6 million and $5.7 million, respectively.
Allowance for Doubtful Accounts
The adoption of ASU 2016-13 on February 1, 2020 required the Company to shift from an incurred loss impairment model to an expected credit loss model. Accordingly, the Company is required to consider expectations of forward-looking losses, in addition to historical loss rates, to estimate its allowance for doubtful accounts on its account receivables. The following is a summary of the changes in the Company’s allowance for doubtful accounts (in thousands):
Allowance for Doubtful Accounts
Balance at January 31, 2021$6,024 
Provision26 
Recoveries/write-offs(1,646)
Balance as of April 30, 2021
$4,404 
Costs Capitalized to Obtain Contracts with Customers
Deferred commissions were $124.5 million as of April 30, 2021. Amortization expense with respect to deferred commissions was $9.7 million for the three months ended April 30, 2021 and $6.5 million for the three months ended April 30, 2020. There was no impairment loss in relation to the costs capitalized for the periods presented.
9. Equity Incentive Plans and Employee Stock Purchase Plan
2008 Stock Incentive Plan and 2016 Equity Incentive Plan
The Company adopted the 2008 Stock Incentive Plan (as amended, the “2008 Plan”) and the 2016 Equity Incentive Plan (as amended, the “2016 Plan”), primarily for the purpose of granting stock-based awards to employees, directors and consultants, including stock options, restricted stock units (“RSUs”) and other stock-based awards. With the establishment of the 2016 Plan in December 2016, all shares available for grant under the 2008 Plan were transferred to the 2016 Plan. The Company no longer grants any stock-based awards under the 2008 Plan and any shares underlying stock options canceled under the 2008 Plan will be automatically transferred to the 2016 Plan.
Stock Options
The 2016 Plan provides for the issuance of incentive stock options to employees and nonstatutory stock options to employees, directors or consultants. The Company’s Board of Directors or a committee thereof determines the vesting schedule for all equity awards. Stock option awards generally vest over a period of four years with 25% vesting on the one-year anniversary of the award and the remainder vesting monthly over the next 36 months of the grantee’s service to the Company.
15

MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following table summarizes stock option activity for the three months ended April 30, 2021 (in thousands, except share and per share data and years):
Shares
Weighted-
Average
Exercise
Price Per
Share
Weighted-
Average
Remaining
Contractual
Term
(In Years)
Aggregate
Intrinsic
Value
Balance - January 31, 20213,881,545 $7.50 4.8$1,405,540 
Stock options exercised(483,787)7.37 
Stock options forfeited and expired
(9,483)11.00 
Balance - April 30, 20213,388,275 $7.51 4.6$982,426 
Vested and exercisable - January 31, 20213,566,091 $7.22 4.7$1,292,303 
Vested and exercisable - April 30, 20213,303,706 $7.32 4.5$958,531 
Restricted Stock Units
The 2016 Plan provides for the issuance of RSUs to employees, directors and consultants. RSUs granted to new employees generally vest over a period of four years with 25% vesting on the one-year anniversary of the vesting start date and the remainder vesting quarterly over the next 12 quarters, subject to the grantee’s continued service to the Company. RSUs granted to existing employees generally vest quarterly over a period of four years, subject to the grantee’s continued service to the Company.
The following table summarizes RSU activity for the three months ended April 30, 2021:
Shares
Weighted-Average Grant Date Fair Value per RSU
Unvested - January 31, 20213,473,512 $139.68 
RSUs granted677,279 408.82 
RSUs vested(341,939)121.75 
RSUs forfeited and canceled(148,362)155.67 
Unvested - April 30, 20213,660,490 $190.43 
2017 Employee Stock Purchase Plan
In October 2017, the Company’s Board of Directors adopted, and stockholders approved, the 2017 Employee Stock Purchase Plan (the “2017 ESPP”). Subject to any plan limitations, the 2017 ESPP allows eligible employees to contribute, normally through payroll deductions, up to 15% of their earnings for the purchase of the Company’s Class A common stock at a discounted price per share. The Company’s current offering period began December 16, 2020 and is expected to end June 15, 2021.
Stock-Based Compensation Expense
Total stock-based compensation expense recognized in the Company’s unaudited condensed consolidated statements of operations is as follows (in thousands):
Three Months Ended April 30,
20212020
Cost of revenue—subscription
$2,990 $1,827 
Cost of revenue—services
1,487 1,146
Sales and marketing
18,876 10,823
Research and development
20,335 11,759
General and administrative
7,226 5,012
Total stock-based compensation expense
$50,914 $30,567 
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

10. Net Loss Per Share
The Company calculates basic net loss per share by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, less shares subject to repurchase. Diluted net loss per share is computed by giving effect to all potentially dilutive shares of Class A common stock outstanding for the period, including stock options, restricted stock units and shares underlying the conversion option of the 2024 Notes and the 2026 Notes. Basic and diluted net loss per share was the same for each period presented, as the inclusion of all potential shares of Class A common stock outstanding would have been anti-dilutive due to the net loss reported for each period presented.
The following table sets forth the computation of basic and diluted net loss per share (in thousands, except share and per share data):
Three Months Ended April 30,
20212020
Numerator:
Net loss
$(63,992)$(53,967)
Denominator:
Weighted-average shares used to compute net loss per share, basic and diluted
61,361,670 57,649,524 
Net loss per share, basic and diluted
$(1.04)$(0.94)
Prior to the adoption of ASU 2020-06, the Company calculated the potential dilutive effect of its 2024 Notes and 2026 Notes under the treasury stock method. As a result, only the amount by which the conversion value exceeded the aggregate principal amount of the 2024 Notes and 2026 Notes (the “conversion spread”) was considered in the diluted earnings per share computation. The conversion spread only had a dilutive impact on diluted net income per share when the average market price of the Company’s Class A common stock for a given period exceeded the initial conversion price of $68.15 per share for the 2024 Notes and $211.20 per share for the 2026 Notes.
Upon the adoption of ASU 2020-06 on February 1, 2021, the Company calculates the potential dilutive effect of its 2024 Notes and 2026 under the if-converted method. Under this method, diluted earnings per share is determined by assuming that all of the 2024 Notes and the 2026 Notes were converted into shares of the Company’s Class A common stock at the beginning of the reporting period.
In connection with the issuance of the 2024 Notes and 2026 Notes, the Company entered into Capped Calls, which were not included for purposes of calculating the number of diluted shares outstanding, as their effect would have been anti-dilutive. The Capped Calls are expected to partially offset the potential dilution to the Company’s Class A common stock upon any conversion of the 2024 Notes and 2026 Notes. The Company has not exercised any of its Capped Calls as of April 30, 2021.
The following weighted-average outstanding potentially dilutive shares of common stock were excluded from the computation of diluted net loss per share for the periods presented because the impact of including them would have been anti-dilutive.
Three Months Ended April 30,
20212020
Stock options pursuant to the 2016 Equity Incentive Plan
918,106 1,646,894 
Stock options pursuant to the 2008 Stock Incentive Plan (previously options to purchase Class B common stock)
2,755,430 4,326,300 
Unvested restricted stock units
3,812,342 3,866,970 
Early exercised stock options
416 10,157 
Shares underlying the conversion option of the 2024 Notes (conversion spread only prior to the adoption of ASU 2020-06)871,697 707,613 
Shares underlying the conversion option of the 2026 Notes5,445,135  
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MONGODB, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. Income Taxes
The Company recorded a provision for (benefit from) income taxes of $(1.4) million and $0.2 million for the three months ended April 30, 2021 and 2020, respectively. The benefit recorded during the three months ended April 30, 2021 was driven by the release of the valuation allowance as a result of goodwill recorded associated with an immaterial business combination, as well as the reversal of the deferred tax liability associated with the convertible senior notes upon the adoption of ASU 2020-06, partially offset by an increase in foreign taxes as the Company continued its global expansion. The calculation of income taxes was based upon the estimated annual effective tax rates for the year applied to the current period income (loss) before tax plus the tax effect of any significant unusual items, discrete events or changes in tax law.
The Company assesses uncertain tax positions in accordance with ASC 740-10, Accounting for Uncertainties in Tax. As of January 31, 2021, the Company’s net unrecognized tax benefits totaled $17.5 million, which would have no impact on the Company’s effective tax rate if recognized.
On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law. The CARES Act includes provisions relating to refundable payroll tax credits, deferral of certain payroll taxes, technical corrections to tax depreciation methods for qualified improvement property, net operating loss carryback periods, alternative minimum tax credit refunds and modifications to the net interest deduction limitations. The CARES Act did not have a material impact on the Company’s interim unaudited condensed consolidated financial statements for the three months ended April 30, 2021. The Company will continue to monitor any effects that may result from the CARES Act.

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ITEM 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Unless the context otherwise indicates, references in this report to the terms “MongoDB,” “the Company,” “we,” “our” and “us” refer to MongoDB, Inc., its divisions and its subsidiaries. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with (1) our interim unaudited condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and (2) the audited consolidated financial statements and the related notes and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2021 (the “2021 Form 10-K”). All information presented herein is based on our fiscal calendar year, which ends January 31. Unless otherwise stated, references to particular years, quarters, months or periods refer to our fiscal years ended January 31 and the associated quarters, months and periods of those fiscal years.
This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements are often identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “will,” “would” or the negative or plural of these words or similar expressions or variations, including our expectations regarding our future growth opportunity, revenue and revenue growth, investments, strategy, operating expenses and the anticipated impact of the global economic uncertainty and financial market conditions caused by the ongoing COVID-19 pandemic on our business, results of operations and financial condition. Such forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified herein, and those discussed in the section titled “Risk Factors,” set forth in Part 2, Item 1A of this Quarterly Report on Form 10-Q. You should not rely upon forward-looking statements as predictions of future events. Furthermore, such forward-looking statements speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.
Our corporate website is located at www.mongodb.com. We make available free of charge, on or through our corporate website, our annual, quarterly and current reports, and any amendments to those reports, as soon as reasonably practicable after electronically filing such reports with, or furnishing such reports to, the Securities and Exchange Commission (“SEC”). Information contained on our corporate website is not part of this Quarterly Report on Form 10-Q or any other report filed with or furnished to the SEC.
Overview
MongoDB is the leading modern, general purpose database platform. Our robust platform enables developers to build and modernize applications rapidly and cost-effectively across a broad range of use cases. Organizations can deploy our platform at scale in the cloud, on-premise, or in a hybrid environment. Through our unique document-based architecture, we are able to address the needs of organizations for performance, scalability, flexibility and reliability while maintaining the strengths of legacy databases. Software applications are redefining how organizations across industries engage with their customers, operate their businesses and compete with each other. A database is at the heart of every software application. As a result, selecting a database is a highly strategic decision that directly affects developer productivity, application performance and organizational competitiveness. Our platform addresses the performance, scalability, flexibility and reliability demands of modern applications, while maintaining the strengths of legacy databases. Our business model combines the developer mindshare and adoption benefits of open source with the economic benefits of a proprietary software subscription business model. MongoDB is headquartered in New York City and our total headcount was 2,745 as of April 30, 2021, an increase from 2,020 as of April 30, 2020.
We generate revenue primarily from sales of subscriptions, which accounted for 96% of our total revenue for each of the three month periods ended April 30, 2021 and 2020.
MongoDB Atlas is our hosted multi-cloud database-as-a-service (“DBaaS”) offering that includes comprehensive infrastructure and management, which we run and manage in the cloud. During the three months ended April 30, 2021, MongoDB Atlas revenue represented 51% of our total revenue, as compared to 42% of our total revenue during the three months ended April 30, 2020, reflecting the continued growth of MongoDB Atlas since its introduction in June 2016. We have experienced strong growth in self-serve customers of MongoDB Atlas. These customers are charged monthly in arrears
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based on their usage. In addition, we have also seen growth in MongoDB Atlas customers sold by our sales force. These customers typically sign annual contracts and pay in advance or are invoiced monthly in arrears based on usage.
MongoDB Enterprise Advanced is our proprietary commercial database server offering for enterprise customers that can run in the cloud, on-premise or in a hybrid environment, and includes our proprietary commercial database server, enterprise management capabilities, our graphical user interface, analytics integrations, technical support and a commercial license to our platform. MongoDB Enterprise Advanced revenue represented 40% of our subscription revenue for the three months ended April 30, 2021 and 49% of our subscription revenue for the three months ended April 30, 2020. We sell subscriptions directly through our field and inside sales teams, as well as indirectly through channel partners. The majority of our subscription contracts are one year in duration and are invoiced upfront. When we enter into multi-year subscriptions, we typically invoice the customer on an annual basis.
Many of our enterprise customers initially get to know our software by using Community Server, which is our free-to-download version of our database that includes the core functionality developers need to get started with MongoDB without all the features of our commercial platform. Our platform has been downloaded from our website more than 175 million times since February 2009 and over 70 million times in the last 12 months alone. We also offer a free tier of MongoDB Atlas, which provides access to our hosted database solution with limited processing power and storage, as well as certain operational limitations. As a result, with the availability of both Community Server and MongoDB Atlas free tier offerings, our direct sales prospects are often familiar with our platform and may have already built applications using our technology. A core component of our growth strategy for MongoDB Atlas and MongoDB Enterprise Advanced is to convert developers and their organizations who are already using Community Server or the free tier of MongoDB Atlas to become customers of our commercial products and enjoy the benefits of either a self-managed or hosted offering.
We also generate revenue from services, which consist primarily of fees associated with consulting and training services. Revenue from services accounted for 4% of our total revenue for both the three months ended April 30, 2021 and 2020. We expect to continue to invest in our services organization as we believe it plays an important role in accelerating our customers’ realization of the benefits of our platform, which helps drive customer retention and expansion.
We believe the market for our offerings is large and growing. According to IDC, the worldwide database software market, which it refers to as the data management software market, is forecast to be $73 billion in 2021 growing to approximately $119 billion in 2025, representing a 13% compound annual growth rate. We have experienced rapid growth and have made substantial investments in developing our platform and expanding our sales and marketing footprint. We intend to continue to invest heavily to grow our business to take advantage of our market opportunity rather than optimizing for profitability or cash flow in the near term.
Impact of the Ongoing COVID-19 Pandemic
The ongoing COVID-19 pandemic has continued to impact the United States (“U.S.”) and the world. As a result, authorities have from time to time implemented numerous measures to contain the virus, including travel bans and restrictions, quarantines, shelter-in-place orders, and business limitations and shutdowns. Although many jurisdictions have relaxed such restrictions, in some cases these restrictions have been or may in the future be re-instituted, and other jurisdictions are imposing restrictions for the first time. As the COVID-19 pandemic continues, it is highly uncertain to what extent and when restrictions will be lifted in various jurisdictions. The full extent of the impact of the ongoing COVID-19 pandemic on our future operational and financial performance will depend on certain developments, including the duration and spread of the outbreak and the impact of new variants of the virus that causes COVID-19; the public health measures taken by authorities and other entities to contain and treat COVID-19; the actions taken to effect a widespread, global roll-out of the available vaccines; and the impact of the COVID-19 pandemic on the global economy and on our current and prospective customers, employees, vendors and other parties with whom we do business, all of which are uncertain and cannot be predicted.
We adopted several measures in response to the COVID-19 pandemic, including temporarily requiring employees to work remotely, suspending non-essential travel by our employees, and replacing in-person marketing events (including our annual developer conference) with virtual events. We have informed our employees that they may continue to elect to work remotely until September 1, 2021, even if their office reopens.
While the broader implications of the ongoing COVID-19 pandemic on our results of operations and overall financial performance remain uncertain, we currently expect our revenue to continue to be negatively impacted by the slowdown in activity and other challenges associated with the COVID-19 pandemic and global uncertainty in the near term.
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During the three months ended April 30, 2021, we experienced a decrease in our travel costs due to global travel restrictions and remote work arrangements in effect as a result of the ongoing COVID-19 pandemic.
We will continue to evaluate the nature and extent of the impact of COVID-19 on our business. For further discussion of the potential impacts of the ongoing COVID-19 pandemic on our business, operating results, and financial condition, see the section titled “Risk Factors” included in Part II, Item 1A of this Quarterly Report on Form 10-Q. Other factors affecting our performance are discussed below, although we caution you that the ongoing COVID-19 pandemic may also further impact these factors.
Key Factors Affecting Our Performance
Growing Our Customer Base and Expanding Our Global Reach
We are intensely focused on continuing to grow our customer base. We have invested, and expect to continue to invest, heavily in our sales and marketing efforts and developer community outreach, which are critical to driving customer acquisition. As of April 30, 2021, we had over 26,800 customers across a wide range of industries and in over 100 countries, compared to over 18,400 customers as of April 30, 2020. All affiliated entities are counted as a single customer.
Our customer count as of April 30, 2021 includes customers acquired from ObjectLabs Corporation (“mLab”) and Tightdb, Inc. (“Realm”), which acquisitions closed on November 1, 2018 and May 7, 2019, respectively. Our definition of “customer” excludes (1) users of our free offerings, (2) mLab users who spend $20 or less per month with us and (3) self-serve users acquired from Realm. The excluded mLab and Realm users collectively represent an immaterial portion of the revenue associated with users acquired from those acquisitions.
As of April 30, 2021, we had over 3,300 customers that were sold through our direct sales force and channel partners, as compared to over 2,200 such customers as of April 30, 2020. These customers, which we refer to as our Direct Sales Customers, accounted for 84% of our subscription revenue for the three months ended April 30, 2021 and 79% of our subscription revenue for the three months ended April 30, 2020. The percentage of our subscription revenue from Direct Sales Customers increased, in part, due to existing self-serve customers of MongoDB Atlas becoming Direct Sales Customers. We are also focused on increasing the number of overall MongoDB Atlas customers as we emphasize the on-demand scalability of MongoDB Atlas by allowing our customers to consume the product with minimal commitment. After launching in June 2016, we had over 25,300 MongoDB Atlas customers as of April 30, 2021. The growth in MongoDB Atlas customers included customers from mLab and Realm, as described above, as well as new customers to MongoDB and existing MongoDB Enterprise Advanced customers adding incremental MongoDB Atlas workloads.
In an effort to expand our global reach, in October 2019, we announced a partnership with Alibaba Cloud to offer an authorized MongoDB-as-a-service solution allowing customers of Alibaba Cloud to use this managed offering from their data centers globally. We expanded our reach in China in February 2021 when we announced the launch of a global partnership with Tencent Cloud that allows customers to easily adopt and use MongoDB-as-a-Service across Tencent’s global cloud infrastructure.
Increasing Adoption of MongoDB Atlas
MongoDB Atlas, our hosted multi-cloud offering, is an important part of our run-anywhere strategy. To accelerate adoption of this DBaaS offering, in 2017, we introduced tools to easily migrate existing users of our Community Server offering to MongoDB Atlas. We have also expanded our introductory offerings for MongoDB Atlas, including a free tier, which provides limited processing power and storage in order to drive usage and adoption of MongoDB Atlas among developers. Our MongoDB Atlas free tier offering is now available on all three major cloud providers (Amazon Web Services (“AWS”), Google Cloud Platform (“GCP”) and Microsoft Azure) in North America, Europe and Asia Pacific. In addition, MongoDB Atlas is available on AWS Marketplace, making it easier for AWS customers to buy and consume MongoDB Atlas. Our business partnership with GCP provides deeper product integration and unified billing for GCP customers who are also MongoDB Atlas customers and offers GCP customers a seamless integration between MongoDB Atlas and GCP. The availability of MongoDB Atlas on the Microsoft Azure Marketplace offers unified billing for joint customers of MongoDB Atlas and Microsoft and makes it easier for established Azure customers to purchase and use MongoDB Atlas. In addition, MongoDB is part of Microsoft’s strategic partner program.
We have also expanded the functionality available in MongoDB Atlas beyond that of our Community Server offering. We expect this will drive further adoption of MongoDB Atlas as companies migrate mission-critical applications to the public cloud. The enterprise capabilities that we have introduced to MongoDB Atlas include advanced security features,
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enterprise-standard authentication and database auditing. We have invested significantly in MongoDB Atlas and our ability to drive adoption of MongoDB Atlas is a key component of our growth strategy.
Retaining and Expanding Revenue from Existing Customers
The economic attractiveness of our subscription-based model is driven by customer renewals and increasing existing customer subscriptions over time, referred to as land-and-expand. We believe that there is a significant opportunity to drive additional sales to existing customers, and expect to invest in sales and marketing and customer success personnel and activities to achieve additional revenue growth from existing customers. If an application grows and requires additional capacity, our customers increase their subscriptions to our platform. In addition, our customers expand their subscriptions to our platform as they migrate additional existing applications or build new applications, either within the same department or in other lines of business or geographies. Also, as customers modernize their information technology infrastructure and move to the cloud, they may migrate applications from legacy databases. Our goal is to increase the number of customers that standardize on our database within their organization. Over time, the subscription amount for our typical Direct Sales Customer has increased.
We calculate annualized recurring revenue (“ARR”) and annualized monthly recurring revenue (“MRR”) to help us measure our subscription revenue performance. ARR includes the revenue we expect to receive from our customers over the following 12 months based on contractual commitments and, in the case of Direct Sales Customers of MongoDB Atlas, by annualizing the prior 90 days of their actual consumption of MongoDB Atlas, assuming no increases or reductions in their subscriptions or usage. For all other customers of our self-serve products, we calculate annualized MRR by annualizing the prior 30 days of their actual consumption of such products, assuming no increases or reductions in usage. ARR and annualized MRR exclude professional services. The number of customers with $100,000 or greater in ARR and annualized MRR was 1,057 and 780 as of April 30, 2021 and 2020, respectively. Our ability to increase sales to existing customers will depend on a number of factors, including customers’ satisfaction or dissatisfaction with our products and services, competition, pricing, economic conditions or overall changes in our customers’ spending levels.
We also examine the rate at which our customers increase their spend with us, which we call net ARR expansion rate. We calculate net ARR expansion rate by dividing the ARR at the close of a given period (the “measurement period”), from customers who were also customers at the close of the same period in the prior year (the “base period”), by the ARR from all customers at the close of the base period, including those who churned or reduced their subscriptions. For Direct Sales Customers included in the base period, measurement period or both such periods that were self-serve customers in any such period, we also include annualized MRR from those customers in the calculation of the net ARR expansion rate. Our net ARR expansion rate remained over 120% during the three months ended April 30, 2021, demonstrating our ability to expand within existing customers.
Components of Results of Operations
Revenue
Subscription Revenue. Our subscription revenue is comprised of term licenses and hosted as-a-service solutions. Subscriptions to term licenses include technical support and access to new software versions on a when-and-if available basis. Revenue from our term licenses is recognized upfront for the license component and ratably for the technical support and when-and-if available update components. Associated contracts are typically billed annually in advance. Revenue from our hosted as‑a‑service solutions is primarily generated on a usage basis and is billed either in arrears or paid up front. The majority of our subscription contracts are one year in duration. When we enter into multi-year subscriptions, we typically invoice the customer on an annual basis. Our subscription contracts are generally non-cancelable and non-refundable.
Services Revenue. Services revenue is comprised of consulting and training services and is recognized over the period of delivery of the applicable services. We recognize revenue from services agreements as services are delivered.
We expect our revenue may vary from period to period based on, among other things, the timing and size of new subscriptions, the proportion of term license contracts that commence within the period, the rate of customer renewals and expansions, delivery of professional services, the impact of significant transactions and seasonality of or fluctuations in usage for our consumption‑based customers. Further, we currently expect our revenue to be negatively impacted by the slowdown in activity and other challenges associated with the COVID-19 pandemic in fiscal 2022.
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Cost of Revenue
Cost of Subscription Revenue. Cost of subscription revenue primarily includes personnel costs, including salaries, bonuses and benefits, and stock‑based compensation, for employees associated with our subscription arrangements principally related to technical support and allocated shared costs, as well as depreciation and amortization. Our cost of subscription revenue for our hosted as‑a‑service solutions also includes third-party cloud infrastructure expenses. We expect our cost of subscription revenue to increase in absolute dollars as our subscription revenue increases and, depending on the results of MongoDB Atlas, our cost of subscription revenue may increase as a percentage of subscription revenue as well.
Cost of Services Revenue. Cost of services revenue primarily includes personnel costs, including salaries, bonuses and benefits, and stock‑based compensation, for employees associated with our professional service contracts, as well as, travel costs, allocated shared costs and depreciation and amortization. We expect our cost of services revenue to increase in absolute dollars as our services revenue increases.
Gross Profit and Gross Margin
Gross Profit. Gross profit represents revenue less cost of revenue.
Gross Margin. Gross margin, or gross profit as a percentage of revenue, has been and will continue to be affected by a variety of factors, including the average sales price of our products and services, the