Datadog, MongoDB, Snowflake in spotlight as cloud consumption rose in July: BofA

Datadog (NASDAQ:DDOG), MongoDB (NASDAQ:MDB) and Snowflake (NYSE:SNOW) were in the spotlight on Monday as Bank of America said that cloud consumption data showed a rebound in July after a “weak” June.

“Across the cloud consumption group, average engaged visits improved during July, following a soft June (engaged visit +10.4% [year-over-year] up from -1.4% in June),” analysts at the firm wrote in a research note. “In addition, [month-over-month] growth of +6.6% is well above seasonality of -2.8%, which is calculated as the trailing [three-year month-over-month] average.”

For Datadog, engaged visits grew 5.2% year-over-year in July, up from a 9.2% decline in June. Additionally, visits grew 9.5% month-over-month, ahead of the normal seasonal decline of 1.7%. “The accelerating growth (+10% m/m, from +1.2% in June) is positive data point that the healthy demand seen in 2Q24 results is likely continuing,” the analysts wrote.

For MongoDB, engaged visits likely grew 0.9% year-over-year in July, the analysts said, citing data from Web Market Analysis. “We are hopeful that solid July activity is an early sign that macro pressure, which impacted the disappointing FY25 outlook, is easing,” the analysts wrote.

For Snowflake, total page view growth in July was up 16.4% year-over-year, “up significantly” from the 1.2% decline seen in June. Additionally, the 13.3% rise month–over-month is “well above” the normal seasonal decline of 1.7%, Bank of America’s analysts said. “The June inflection is encouraging, perhaps suggesting that new product cycles (Cortex, Artic) are emerging.”

The firm has a Buy rating on Datadog and MongoDB and a Neutral rating on Snowflake.

The firm also weighed in on Microsoft (MSFT) and Adobe (ADBE), adding that both Microsoft 365 and Adobe 365 saw better month-over-month- activity in July.

Microsoft 365 engaged visits grew 31% year-over-year in July, up from 18.4% in June, and up 4.7% month-over-month, well above the seasonal decline of 6.2%. “We are hopeful this indicates easing SMB macro pressure, which has affected commercial Office additions in recent quarters,” the analysts said.

Adobe’s Creative Cloud saw a 34.5.% year-over-year decline in engaged visit growth in July, better than the 44.6% decline seen in June. The month-over-month decline of 1% is above the normal seasonal decline of 9.2%.

“The data point could be an early indicator of traction with Firefly, which is increasingly embedded into key creative cloud offerings such as Photoshop and Lightroom,” the analysts added.

Bank of America has Buy ratings on Microsoft and Adobe.