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Atlassian Surges as Q3 Tops Forecasts, Cloud Growth Accelerates and Outlook Rises

The blowout quarter signals investors are rewarding the company’s AI‑focused push with larger, longer contracts.

Overview

  • Atlassian shares jumped about 28% Friday after the company beat quarterly estimates, with the stock closing near $89 following the after‑hours surge the night before.
  • Earnings came in at $1.75 a share versus $1.32 expected, and revenue reached about $1.79 billion, up roughly 32% from a year earlier.
  • Cloud sales topped $1.1 billion and grew 29% year over year, while the Service Collection passed $1 billion in annual recurring revenue and the Rovo AI assistant saw usage grow more than 20% month over month.
  • The company raised full‑year revenue growth guidance to 24% and reported roughly $4 billion in remaining performance obligations, signaling stronger visibility into future sales.
  • Free cash flow missed forecasts due to $94 million in restructuring payments in the quarter, with about $76 million more expected next quarter, and data‑center license timing pulled forward roughly $50 million of revenue, adding short‑term lumpiness.