Key Takeaways:
Atlassian reported fiscal Q4 revenue of $1.766 billion, up 28% year over year and beating the $1.66 billion consensus, as cloud revenue accelerated 31% to $1.213 billion.
"Cloud revenue growth accelerated on a year-over-year basis, driven by deeper enterprise commitments to the Atlassian platform," CFO James Chuong said.
Non-GAAP diluted EPS came in at $1.87 versus the $1.50 consensus, while GAAP diluted EPS swung to $0.55 from a loss of $0.09. Subscription annual recurring revenue reached $6.606 billion, up 23%, and remaining performance obligations rose 44% to $4.817 billion. GAAP operating margin improved to 12% from negative 2%, and free cash flow totaled $475 million, a 27% margin.
The company guided fiscal 2027 revenue growth of approximately 13%, a sharp deceleration from 26% in fiscal 2026, with Data Center revenue expected to decline 17%. First-quarter revenue is projected at $1.705 billion to $1.715 billion, above the $1.67 billion consensus, with cloud growth of approximately 28.5%.
GAAP operating margin for fiscal 2027 is targeted at 4.5%, up from 0.2% in fiscal 2026, while the non-GAAP target of 25% sits below the 30% achieved last year. The gap between GAAP and non-GAAP results remains material, with stock-based compensation and acquired-intangible amortization excluded from non-GAAP measures.
CEO Mike Cannon-Brookes said the Teamwork Graph gives AI agents access to organizational context across Atlassian and third-party applications. The company's MCP server and Teamwork Graph CLI surpassed one million monthly active users, more than doubling during the quarter. Atlassian also expanded enterprise AI capabilities through Isolated Cloud, additional AI administration controls, and HIPAA coverage for Rovo.
Cannon-Brookes separately announced plans to establish a Rule 10b5-1 trading plan for up to $250 million of open-market purchases of Atlassian Class A shares. Insider sales during the quarter included CFO James Chuong selling $775,513 worth of stock in May.
The results come as Atlassian competes with Microsoft's GitHub and Salesforce's Slack for enterprise developer and collaboration spend. The guidance implies a deliberate trade-off: slower top-line growth for improved GAAP profitability. Investors will watch the fiscal Q1 earnings call for whether cloud growth can sustain its 28.5% trajectory as Data Center revenue contracts and the company manages the transition to AI-driven enterprise adoption.
This article is for informational purposes only and does not constitute investment advice.
