- Q1 FY25 income of US$1.19bn, up 21%
- Subscription income of US$1.13bn, up 33%
- US$123.8m web loss, up 300%
- Working lack of $32m
- FY25 income development anticipated at 16.5-17%.
- $1.5bn share buyback deliberate
Atlassian beat its personal income development predictions within the first quarter of the brand new monetary yr (Q1, FY25), however its losses additionally proceed to develop amid predictions of slowing development.
The Sydney-based office software program firm had a powerful September quarter below cofounder Mike Cannon-Brookes as sole CEO, with complete income rising 21% on 12 months in the past to US$1.19 billion on top-end predictions of $1.16bn.
Subscription income grew by 33% to US$1.13bn, beating the corporate’s prediction of 27%, and the market appeared proud of the outcomes, with Atlassian (NASDAQ: TEAM) shares popping greater than 17% in after-hours commerce, from US$188.54 at Thursday’s near above $220.
Information of a US$1.5 billion share buyback program could have added to the ebullience, whereas Atlassian has additionally discovered a brand new chief income officer, SAP veteran Brian Duffy, who clocks on from January 1, 2025, after 18 years on the German multinational, the place he rose to be SAP’s president of cloud and was most not too long ago CEO of SoftwareOne.
However alongside the expansion story, Atlassian continues its long-standing custom of losses, which have jumped year-on-year. The web loss for the September quarter was US$123.8 million, round 300% increased than the $31.9m web loss for Q1, FY24. The web loss per diluted share rose to $0.48 in Q1 FY25, from -$0.12 within the corresponding quarter 12 months in the past.
The working loss grew to US$32.0 million in Q1, in comparison with an working lack of $18.9m in Q1 FY24. The working margin loss rose to (3%) this quarter, in contrast with (2%) 12 months in the past.
Money move from operations sat at US$80.5m with free money move of $74.3m, with Atlassian ending the September quarter with US$2.2 billion in money, money equivalents and marketable securities.
Atlassian CFO Joe Binz mentioned the 2025 fiscal years was “off to a stable begin”.
“We proceed to focus our funding and execution in opposition to our key strategic priorities of serving the enterprise, delivering AI innovation, and additional bringing collectively know-how and enterprise groups with the Atlassian System of Work,” he mentioned.
In his quarterly letter to shareholders, his first since cofounder Scott Farquhar stepped down as co-CEO, Mike Cannon-Brooks mentioned he’s “happy with the progress we’ve made” within the quarter and “optimistic concerning the vital alternatives forward”, even because the enterprise predicts slower income development for FY2025, with complete income anticipated within the vary of 16.5-17%, and cloud income development of 24%.
“Our years of effort in constructing a world-class cloud platform are paying off, notably within the AI period. Our System of Work philosophy is more and more being adopted by technology-driven organisations, and our merchandise proceed to be the cornerstone for a way thousands and thousands of groups get work achieved,” he mentioned.
“It’s the distinctive mixture of the Atlassian platform, our System of Work philosophy, our AI technique and our portfolio of merchandise that provides me confidence in our capability to realize our mission of unleashing the potential of each crew.”
Cannon-Brookes pointed to the corporate’s concentrate on synthetic intelligence (AI) deployment in its merchandise, launching Rovo, an AI-powered product with superior enterprise search capabilities and brokers to assist remedy complicated issues and deal with repetitive duties on the Atlassian platform and different SaaS functions.
“Via the ability of our R&D engine, we’re not simply advertising and marketing AI, we’re transport it. I’m thrilled our crew was capable of launch Rovo, our newest product constructed for the AI period, into common availability simply 5 months since its announcement,” Cannon-Brookes mentioned.
“We’re delivering differentiated worth for purchasers via the ability of Atlassian’s cloud platform and our Teamwork Graph – enabling groups to unlock organisational data at scale throughout each first-party and third-party functions.”
Atlassian expects Q2 income to be within the vary of US$1.233bn and $1.241bn, with cloud income rising by 25.5% and information centre income up 27.5%. The December quarter working margin is predicted to be roughly (10.0%) on a GAAP foundation and roughly 21.0% on a non-GAAP foundation.
The working margin for the 2025 monetary yr is predicted to be within the vary of (5.5%) to (5.0%) on a GAAP foundation and within the vary of twenty-two.0% to 22.5% on a non-GAAP foundation.
Atlassian’s September quarter, FY2025 outcomes. Supply: Atlassian
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