Atlassian Stock Climbs To 3-Year High After-Hours On Beat-And-Raise Q2 But Retail Sentiment Lags

Atlassian Corp. ($TEAM) stock surged higher in Thursday’s after-hours session after the San Francisco, California-based company announced better-than-expected fiscal 2025 second-quarter results. It also lifted its full-year revenue outlook.

The company reported second-quarter non-GAAP earnings per share (EPS) of $0.96, up from $0.73 last year, and revenue of $1.29 billion, up 21% year-over-year (YoY). 

The results exceeded the consensus estimates, which called for non-GAAP EPS of $0.75 and revenue of $1.24 billion, and also bettered the guidance of $1.23 billion to $1.24 billion.

Atlassian, which provides collaboration software, services, and tools like Jira, Confluence, Trello, and Loom, said its subscription revenue climbed 30% to $1.21 billion, slowing from the 33% rate in the previous quarter.

The company ended the quarter with 49,449 customers with over $10,000 in annualized recurring revenue (ARR), up 15% YoY. The growth decelerated from the 17% pace in the first quarter.

Mike Cannon-Brookes, Atlassian’s CEO and co-founder, said, “By infusing AI throughout our world-class cloud platform, we’re empowering all teams to accelerate collaboration and unlock organizational knowledge, further enabling them to unleash their full potential.”

CFO Joe Binz attributed the better-than-expected revenue across its Cloud and Data Center business to strong enterprise sales execution. 

Looking ahead, Atlassian expects third-quarter revenue in the range of $1.345 billion to $1.353 billion, with an estimated 23.5% growth in Cloud revenue and 7% growth in Data Centers. The Street estimate is at $1.32 billion, according to Yahoo Finance data.

It models non-GAAP gross margin of 84.5%.

The company guided full-year revenue growth to 18.5%-19%, up from the previous outlook of 16.5%-17% and better than the consensus estimate of 17.2% growth.

Non-GAAP Gross margin is expected at 84%-84.5%.

On Stocktwits, retail sentiment turned ‘bearish’ (36/100) from ‘neutral’ a day ago, with message volume staying at ‘normal’ levels.

TEAM sentiment and message volume January 30, as of 10:26 pm| Source: Stocktwits

Bearish stock watchers on the platform balked at the valuation. Some said they were shorting the stock

Atlassian stock last traded up 19.50% at $319 in Thursday’s after-hours session, marking the highest levels since Feb. 16, 2022. The stock has gained nearly 10% in January.

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