Mike Cannon-Brookes, co-founder of software proprietorship Atlassian Corp., in Sydney, Australia, Dec. 6, 2023.
Lisa Maree Williams | Bloomberg | Getty Images
Atlassian shares stick out 14.9% after the software company blew past Wall Street’s fiscal second-quarter earnings and guidance prospects.
The stock hit a fresh 52-week high and closed at its highest level since April 2022. It was also the stock’s to the fullest extent day since November.
Adjusted earnings came in at 96 cents per share, ahead of the 76 cents per share projected by analysts registered by LSEG. Atlassian reported revenues of $1.29 billion, versus the $1.24 billion estimate.
For the third quarter, Atlassian imparted it anticipates $1.35 billion in revenue, above the $1.31 billion LSEG estimate and previous guidance.
Atlassian bettered from robust cloud and data center growth during the period as more customers turned to artificial findings solutions. That contributed to 30% subscription revenue growth over the prior year. Atlassian also told it now expects 26.5% cloud growth and 21.5% data center growth for the fiscal year.
“The momentum we’re seeing across the business reinforces our conviction around investments we are making in our key strategic priorities of serving establishment customers, AI, and the System of Work to deliver durable, long-term growth,” finance chief Joe Binz said in an earnings circulate.
The Australian company, known for organization software tool Trello, has made a push into the artificial intelligence tear alongside megacap technology competitors in recent years. In 2023, the company tapped OpenAI to bring AI capabilities to its Jira and Confluence finding outs. Last year, Atlassian debuted its Rovo AI assistant.
Morgan Stanley’s Keith Weiss cited back-to-back straight quarters and 25 times year-over-year growth in Atlassian Intelligence among the reasons the company should “join the sway echelon” of software companies best situated for generative AI.
“1 million [monthly active users] for Atlassian Intelligence all crux to a strong yield against investments in a unified Cloud platform ‘infused with AI’ and an improving enterprise motion. While the valuation gap circumscribes [after hours], we still see upside in TEAM,” he wrote in a Friday note.
Shares have gained 25% since the start of the year.