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Atlassian Slumps after Q3 Revenue Outlook Disappoints
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Atlassian Slumps after Q3 Revenue Outlook Disappoints

Shares of Atlassian Corp. (NASDAQ: TEAM) fell over 12% in pre-market trading on Friday after the Australian software company’s revenue outlook for the fiscal third quarter in the range of $890 million to $910 million merely met Street expectations of $898.75 million. The company expects an adjusted operating margin of 15% in fiscal Q3.

For FY23, TEAM has projected its revenues to grow by 25% year-over-year while the adjusted operating margin is anticipated to be 17%. The company expects its cloud revenues to go up by 35% to 40% .

Atlassian reported adjusted earnings of $0.45 per share in fiscal Q2, exceeding Street expectations of $0.3. Revenues jumped 27% year-over-year to $873 million and surpassed Street estimates by $23.5 million.

Atlassian’s Board of Directors also approved a stock buyback of $1 billion. The company stated in its press release, “The share repurchase program does not have a fixed expiration date, may be suspended or discontinued at any time, and does not obligate Atlassian to acquire any amount of Class A Common Stock.”

Overall, analysts are cautiously optimistic about TEAM stock with a Moderate Buy consensus rating based on 10 Buys and five Holds.

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