09:35 AM EDT, 08/30/2024 (MT Newswires) -- MongoDB's ( MDB ) better-than-expected fiscal second-quarter results and improving consumption trends prompted the database software maker to lift its full-year outlook, according to RBC Capital Markets.

The company late Thursday raised its adjusted earnings guidance to a range of $2.33 to $2.47 a share for fiscal 2025 from its prior forecast of $2.15 to $2.30. It also anticipates revenue to come in between $1.92 billion and $1.93 billion for the year, up from previous projections of $1.88 billion to $1.9 billion. The current consensus on Capital IQ is for normalized EPS of $2.48 and revenue of $1.93 billion.

The improved outlook was mainly driven by a "stronger pipeline" for the company's Enterprise Advanced business in the second half, RBC said in a client note emailed Friday. During an earnings call with analysts, Chief Financial Officer Michael Gordon said the firm is "slightly increasing" its Enterprise Advanced assumptions for the rest of the fiscal year to reflect the strength of the segment's pipeline.

"(Fiscal 2025) guidance is now higher than the company's original outlook," the brokerage wrote in the note. "We think this is less of a sign of (second-half) expectations, and more reflective of a strong (second quarter)."

For the three-month period ended July, MongoDB's ( MDB ) adjusted EPS fell to $0.70 from $0.93 the year before, but topped the Street's view for $0.48. Revenue gained 13% year over year to $478.1 million, topping analysts' $464.2 million estimate. The stock jumped 15% in Friday trading.

During the quarter, existing customer workload consumption growth improved and surpassed senior management's expectations, RBC said. Business generation and sales efficiency also improved, compared with consumption growth headwinds in the first quarter that were increased by a change in sales compensation structures, according to the investment firm.

Revenue for MongoDB's ( MDB ) cloud-based developer data platform, Atlas, advanced 27% on a yearly basis in the second quarter, representing a "solid outcome considering headwinds from lapping unused credits," RBC said. However, consumption growth for the platform is still below the company's original forecast from the beginning of the year, Gordon said on the call.

RBC maintained its outperform rating on MongoDB's ( MDB ) stock and reiterated the $350 price target. "All in, we thought (the second quarter) was a good outcome, and (fiscal 2025) is back on track," the investment firm said.

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