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In case you missed it: Enterprise software joins the AI partyGoogle’s TPUs and NVIDIA’s GPUs are dominating the conversation. But remember, AI is a stack:
And the real story this earnings week is happening above the chips. We are seeing a historic bifurcation in the sector:
Three companies just reported results that hint at where this cycle is heading next. I’m talking about the databases, security layers, and operations pipelines where AI workloads actually run. And the patterns are worth a closer look. Today at a glance:
Disclosure: MDB, CRWD, and GTLB are holdings in App Economy Portfolio.
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1. 🌱 MongoDB: Breakout MomentumMongoDB delivered another standout quarter, with the stock jumping over 22% after earnings. Revenue grew 19% Y/Y to $628 million ($35 million beat), and non-GAAP EPS hit $1.32 ($0.53 beat). Gross margin has been compressing as the revenue mix shifts toward cloud consumption. On the bright side, stock-based compensation was nearly flat Y/Y, helping push the operating margin close to breakeven. Free cash flow hit $140 million, a 4× increase from last year.
The highlight: Developer data platform Atlas accelerated to 30% Y/Y, its fastest pace in six quarters (up from 29% Y/Y in Q2). Atlas now represents 75% of revenue, up from 68% a year ago, driven by strong enterprise demand, healthy developer adoption, and broad-based strength across geographies. Broad strength across key metrics
Existing customers are expanding, new logos remain steady, and the go-to-market engine continues to hum.
Guidance raised againManagement lifted both Q4 and full-year expectations:
Atlas is expected to grow 27% next quarter, with non-Atlas in the upper single digits. Free cash flow conversion should exceed 100% for the year. The magnitude of the FY26 raise caught the market off guard. MongoDB already raised FY26 revenue guidance by $80 million in Q2, but this second upward revision (with only one quarter left) signals real momentum. Earlier in the year, management missed Wall Street’s expectations by $70 million when setting FY26 guidance. It’s now clear that it was simply a conservative setup rather than weakening fundamentals. Building for the AI eraNew CEO CJ Desai (formerly President & COO at Cloudflare) is pitching a clear vision. MongoDB is the modern data platform for AI.
MongoDB’s unified document model, combined with search and vector architecture, is becoming a compelling foundation for AI workloads.
2. 🦅 CrowdStrike: AI Adoption RisesIf there were any lingering doubts about CrowdStrike’s post-outage recovery, Q3 put them firmly in the rearview mirror. Revenue grew 22% Y/Y to $1.23 billion ($10 million beat), and non-GAAP EPS landed at $0.96 ($0.02 beat). Margin stayed relatively flat, with free cash flow margin at 24%... Subscribe to How They Make Money to unlock the rest.Become a paying subscriber of How They Make Money to get access to this post and other subscriber-only content. A subscription gets you:
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Tuesday, December 2, 2025
🤖 The Great AI Bifurcation
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