MongoDB jumps 44% as software tech stocks capture AI boom profits too

MongoDB led a surge in enterprise tech stocks this week, with shares jumping 44% in their best week on record alongside strong gains from Pure Storage (33%), Snowflake (21%), and Autodesk (8.4%). The rally signals that AI’s financial benefits are finally flowing to downstream software companies, easing Wall Street concerns about whether artificial intelligence would boost or displace traditional enterprise technology businesses.

The big picture: While Nvidia and cloud giants like Microsoft and Google have dominated AI’s early winners’ circle, this week’s earnings results suggest enterprise software vendors are starting to capture meaningful value from the AI boom.

• MongoDB CEO Dev Ittycheria noted that enterprise AI deployments are happening “slowly” as companies want to “see some wins before they deploy more investment.”
• The shift comes as AI infrastructure spending begins translating into real business applications across sales, marketing, and back-office automation.

Key financial highlights: MongoDB’s quarterly revenue jumped 24% year-over-year to $591 million, beating analyst estimates of $556 million.

• The database company added over 5,000 new customers in the first half of 2024, “the highest ever” for that period.
• Pure Storage, a data storage management vendor, hit an all-time high after reporting better-than-expected results and raising full-year guidance.
• Snowflake, a data analytics company, boosted its product revenue outlook and reported over 6,100 customers using its AI data cloud, up from 5,200 in the prior quarter.

AI-native customer growth: MongoDB’s customer additions include many “AI native companies who are coming to MongoDB to run their business,” according to Ittycheria.

• Snowflake CEO Sridhar Ramaswamy said AI “is a core reason why customers are choosing Snowflake, influencing nearly 50% of new logos won in Q2.”
• Pure Storage began recognizing revenue from its Meta contract in the second quarter, with finance chief Tarek Robbiati noting “increased interest from other hyperscalers” seeking to replace traditional storage systems.

What they’re saying: Company executives struck confident tones about AI’s impact on their businesses.

• “Our progress with AI has been remarkable,” Ramaswamy said on Snowflake’s earnings call.
• Autodesk CEO Andrew Anagnost addressed existential AI concerns directly: “AI may eat software, but it’s not gonna eat Autodesk.”
• Brad Gerstner, CEO of Altimeter Capital, called Nvidia’s concurrent earnings report “a banger,” noting the chip giant’s revenue soared 56% year-over-year.

Why this matters: The strong performance suggests AI’s economic benefits are broadening beyond chip makers and cloud infrastructure providers to encompass the software layer where businesses actually deploy AI applications, potentially validating the massive AI infrastructure investments of the past two years.