The head of MongoDB says the artificial intelligence gold rush is already producing excesses that will not last.
In a new CNBC Television interview, Dev Ittycheria, MongoDB CEO, says a wave of overfunded companies is burning through capital without proving their businesses are sustainable.
He notes that AI firms are reaching the point where investors will see who is swimming naked.
“But what you’re really saying is that there are lots of companies that have been well funded and basically spending money like drunken sailors, if I can use that expression. And the question is how durable is their revenue growth?
You have co-gen companies who are literally now in the hundreds of millions of dollars and growing incredibly fast. You have other companies who are also growing really fast, but they’re sometimes gross margin negative, and obviously they’re losing a lot of cash. So the bet is that they can get enough brand and enough users that as the cost of tokens comes down, their business essentially becomes more profitable.
Kind of like the Uber model. Uber lost money for years, and then they slowly raised prices, and now they’re generating a ton of cash. That’s a bet. I think there are a lot of companies who have not really nailed product-market fit, and I think there will be a shakeout. I think we are in the, I wouldn’t call it the trough of disillusionment, but there is clearly a betting going on, and now you’re starting to see the separation between the haves and have-nots in a lot of different spaces.”
Ittycheria’s comments come after MongoDB’s stellar performance for the quarter ending July. MongoDB posted Q2 FY2026 total revenue of $591.4 million, marking a 24% year-over-year increase, with Atlas revenue up 29% and now comprising 74% of total revenue.
Atlas is MongoDB’s fully managed cloud service that lets customers deploy, manage, and scale databases across AWS, Google Cloud, or Azure, handling backups, security, scaling, and upgrades, so developers can focus on building apps instead of running infrastructure.
During the quarter, MongoDB also added 2,800 new customers to bring the total number of customers to nearly 60,000.
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