Atlassian Announces Second Quarter Fiscal Year 2026 Results

Revenue of $1,586 million, up 23% year-over-year

Cloud revenue of $1,067 million, up 26% year-over-year

Remaining performance obligations of $3,814 million, up 44% year-over-year

GAAP operating margin of (3)% and non-GAAP operating margin of 27%

Atlassian Corporation (NASDAQ:TEAM), a leading provider of team collaboration and productivity software, today announced financial results for its second quarter ended December 31, 2025. A shareholder letter was posted on the Investor Relations section of Atlassian's website at https://investors.atlassian.com.

"We closed out Q2 with incredible momentum across the Atlassian platform and achieved some impressive milestones along the way. We delivered our first-ever $1 billion Cloud revenue quarter, which grew 26% year-over-year, crossed 350,000 customers, and Rovo surpassed 5 million monthly active users," said Mike Cannon-Brookes, Atlassian's CEO and co-Founder. "Companies from the largest enterprises in the world, to the most innovative startups, rely on the Atlassian platform every day to power workflows across their organizations and unleash teamwork and knowledge at scale."

"We delivered another strong quarter of enterprise sales and partner execution, which drove total revenue up 23% year-over-year to $1.6 billion, surpassing $6 billion in annual run-rate revenue," said Joe Binz, Atlassian's CFO. "With RPO up 44% year-over-year to $3.8 billion, our investments across enterprise, AI and system of work are yielding results and deeper, long-term customer commitments to the Atlassian platform."

Second Quarter Fiscal Year 2026 Financial Highlights:

On a GAAP basis, Atlassian reported:

• Revenue: Total revenue was $1,586.3 million for the second quarter of fiscal year 2026, up 23% from $1,286.5 million for the second quarter of fiscal year 2025.
• Operating Loss and Operating Margin: Operating loss was $47.7 million for the second quarter of fiscal year 2026, compared with operating loss of $57.5 million for the second quarter of fiscal year 2025. Operating margin was (3%) for the second quarter of fiscal year 2026, compared with (4%) for the second quarter of fiscal year 2025.
• Net Loss and Net Loss Per Diluted Share: Net loss was $42.6 million for the second quarter of fiscal year 2026, compared with net loss of $38.2 million for the second quarter of fiscal year 2025. Net loss per diluted share was $0.16 for the second quarter of fiscal year 2026, compared with net loss per diluted share of $0.15 for the second quarter of fiscal year 2025.
• Balance Sheet: Cash and cash equivalents plus marketable securities at the end of the second quarter of fiscal year 2026 totaled $1.6 billion.

On a non-GAAP basis, Atlassian reported:

• Operating Income and Operating Margin: Operating income was $430.2 million for the second quarter of fiscal year 2026, compared with operating income of $335.1 million for the second quarter of fiscal year 2025. Operating margin was 27% for the second quarter of fiscal year 2026, compared with 26% for the second quarter of fiscal year 2025.
• Net Income and Net Income Per Diluted Share: Net income was $320.9 million for the second quarter of fiscal year 2026, compared with net income of $255.6 million for the second quarter of fiscal year 2025. Net income per diluted share was $1.22 for the second quarter of fiscal year 2026, compared with net income per diluted share of $0.96 for the second quarter of fiscal year 2025.
• Free Cash Flow: Cash flow from operations was $177.8 million and free cash flow was $168.5 million for the second quarter of fiscal year 2026. Free cash flow margin for the second quarter of fiscal year 2026 was 11%.

A reconciliation of GAAP to non-GAAP financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below, under the heading "About Non-GAAP Financial Measures."

Recent Business Highlights:

• A Leader in the 2025 Gartner® Magic Quadrant™ for Marketing Work Management Platforms: Atlassian was recognized as a Leader in the 2025 Gartner Magic Quadrant for Marketing Work Management Platforms¹ for the second consecutive year, and received the highest placement in Completeness of Vision. Atlassian's Marketing Work Management solution is delivered through its Teamwork Collection, which includes Jira, Confluence, Loom, and Rovo, allowing marketing teams to collaborate seamlessly, unleash creativity, and partner with AI agents to power workflows.
• A Leader in the 2025 Gartner® Magic Quadrant™ for Collaborative Work Management: Atlassian was recognized as a Leader in the 2025 Gartner Magic Quadrant for Collaborative Work Management². Atlassian's AI-powered system of work, delivered through its Teamwork Collection, connects work, knowledge, and goals—bringing together technical and business teams to standardize execution, strengthen productivity, and drive continuous improvement across the enterprise. Leading global organizations trust Teamwork Collection to execute faster, align teams, and deliver better outcomes at scale—while preparing for the future of work.
• A Leader in The Forrester Wave™: Enterprise Service Management Platforms, Q4 2025: Atlassian was recognized as a Leader in The Forrester Wave: Enterprise Service Management Platforms³. Atlassian's AI-powered Service Collection, consisting of Jira Service Management, Customer Service Management, Assets, and Rovo, connects development, IT, and business teams across the enterprise to deliver exceptional service experiences. Today, more than 65,000 organizations, including more than half of the Fortune 500, rely on Jira Service Management to enable faster collaboration and resolution for their teams and customers.
• Customers with >$10,000 in Cloud ARR: Atlassian ended its second quarter of fiscal year 2026 with 55,369 customers with greater than $10,000 in Cloud annualized recurring revenue (Cloud ARR), an increase of 12% year-over-year.
• Recognized on the Forbes World's Best Employers 2025 List: Atlassian was recognized on the Forbes World's Best Employers 2025 - Top Companies To Work For list. This achievement highlights Atlassian's commitment to fostering an innovative and collaborative culture that drives technological advancement and delivers outstanding value to customers, partners, and employees.
• Board of Directors Update: Atlassian appointed Anil Sabharwal to its Board of Directors. Anil is Vice President of Product at Google and has held various senior leadership roles at the company for 17 years. Anil is a seasoned technology entrepreneur and innovator with a deep understanding of both technology and its long-term value creation. He brings significant experience building beloved products such as Google Photos, Google Chrome, Google Drive, and more. Anil's extensive technology experience will be invaluable as Atlassian continues to power human-AI collaboration for millions of users worldwide.

Financial Targets:

Atlassian is providing its financial targets as follows:

Third Quarter Fiscal Year 2026:

• Total revenue is expected to be in the range of $1,689 million to $1,697 million.
• Cloud revenue growth year-over-year is expected to be approximately 23.0%.
• Data Center revenue growth year-over-year is expected to be approximately 33.5%.
• Marketplace and other revenue growth year-over-year is expected to be approximately 5.0%.
• Gross margin is expected to be approximately 85.5% on a GAAP basis and approximately 88.0% on a non-GAAP basis.
• Operating margin is expected to be approximately 0.0% on a GAAP basis and approximately 27.5% on a non-GAAP basis.

Fiscal Year 2026:

• Total revenue growth year-over-year is expected to be approximately 22.0%.
• Cloud revenue growth year-over-year is expected to be approximately 24.3%.
• Data Center revenue growth year-over-year is expected to be approximately 20.0%.
• Marketplace and other revenue growth year-over-year is expected to be approximately 6.0%.
• Gross margin is expected to be approximately 84.0% on a GAAP basis and approximately 87.0% on a non-GAAP basis.
• Operating margin is expected to be approximately (3.0%) on a GAAP basis and approximately 25.5% on a non-GAAP basis.

For additional commentary regarding financial targets, please see Atlassian's second quarter fiscal year 2026 shareholder letter dated February 5, 2026.

With respect to Atlassian's expectations under "Financial Targets" above, a reconciliation of GAAP to non-GAAP gross margin and operating margin has been provided in the financial statement tables included in this press release.

Shareholder Letter and Webcast Details:

A detailed shareholder letter is available on the Investor Relations section of Atlassian's website at https://investors.atlassian.com. Atlassian will host a webcast to answer questions today:

• When: Thursday, February 5, 2026 at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time).
• Webcast: A live webcast of the call can be accessed from the Investor Relations section of Atlassian's website at https://investors.atlassian.com. Following the call, a replay will be available on the same website.

Atlassian has used, and will continue to use, its Investor Relations website at https://investors.atlassian.com as a means of making material information public and for complying with its disclosure obligations.

About Atlassian

Atlassian unleashes the potential of every team. A recognized leader in software development, work management, and enterprise service management software, Atlassian enables enterprises to connect their business and technology teams with an AI-powered system of work that unlocks productivity at scale. Atlassian's collaboration software powers over 80% of the Fortune 500 and 350,000+ customers worldwide - including NASA, Rivian, Deutsche Bank, United Airlines, and Bosch - who rely on our solutions to drive work forward.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. In some cases, you can identify these statements by forward-looking words such as "may," "will," "expect," "believe," "anticipate," "intend," "could," "should," "estimate," "further," or "continue," and similar expressions or variations, but these words are not the exclusive means for identifying such statements. All statements other than statements of historical fact could be deemed forward looking, including but not limited to risks and uncertainties related to statements about our platform, offerings and capabilities and planned offerings and capabilities, investments, System of Work, AI solutions and innovation, customers, company culture, strategic priorities, leadership transitions, anticipated growth, outlook and results, and our financial targets such as total revenue, Cloud, Data Center, and Marketplace and other revenue, and GAAP and non-GAAP financial measures including gross margin and operating margin.

We undertake no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.

The achievement or success of the matters covered by such forward-looking statements involves known and unknown risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. You should not rely upon forward-looking statements as predictions of future events. Forward-looking statements represent our management's beliefs and assumptions only as of the date such statements are made. Further information on these and other factors that could affect our financial results is included in filings we make with the Securities and Exchange Commission (the "SEC") from time to time, including the section titled "Risk Factors" in our most recently filed Forms 10-K and 10-Q, as well as those that may be updated in our future filings with the SEC. These documents are available on the SEC Filings section of the Investor Relations section of our website at https://investors.atlassian.com.

About Non-GAAP Financial Measures

In addition to the measures presented in our condensed consolidated financial statements, we regularly review other measures that are not presented in accordance with U.S. generally accepted accounting principles ("GAAP"), defined as non-GAAP financial measures by the SEC, to evaluate our business, measure our performance, identify trends, prepare financial forecasts and make strategic decisions. The key measures we consider are non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, non-GAAP net income per diluted share and free cash flow (collectively, the "Non-GAAP Financial Measures"). These Non-GAAP Financial Measures, which may be different from similarly titled non-GAAP measures used by other companies, provide supplemental information regarding our operating performance on a non-GAAP basis that excludes certain gains, losses and charges of a non-cash nature or that occur relatively infrequently and/or that management considers to be unrelated to our core operations. Management believes that tracking and presenting these Non-GAAP Financial Measures provides management, our board of directors, investors and the analyst community with the ability to better evaluate matters such as: our ongoing core operations, including comparisons between periods and against other companies in our industry; our ability to generate cash to service our debt and fund our operations; and the underlying business trends that are affecting our performance.

Our Non-GAAP Financial Measures include:

• Non-GAAP gross profit and non-GAAP gross margin. Excludes expenses related to stock-based compensation, amortization of acquired intangible assets, and restructuring charges.
• Non-GAAP operating income and non-GAAP operating margin. Excludes expenses related to stock-based compensation, amortization of acquired intangible assets, and restructuring charges.
• Non-GAAP net income and non-GAAP net income per diluted share. Excludes expenses related to stock-based compensation, amortization of acquired intangible assets, restructuring charges, and the related income tax adjustments of these items.
• Free cash flow. Free cash flow is defined as net cash provided by operating activities less capital expenditures, which consists of purchases of property and equipment.

We understand that although these Non-GAAP Financial Measures are frequently used by investors and the analyst community in their evaluation of our financial performance, these measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP. We compensate for such limitations by reconciling these Non-GAAP Financial Measures to the most comparable GAAP financial measures. We encourage you to review the tables in this press release titled "Reconciliation of GAAP to Non-GAAP Results" and "Reconciliation of GAAP to Non-GAAP Financial Targets" that present such reconciliations.

Customers with >$10,000 in Cloud ARR

We define the number of customers with Cloud ARR greater than $10,000 at the end of any particular period as the number of organizations with unique domains with an active Cloud subscription for two or more seats and greater than $10,000 in Cloud ARR.

We define Cloud ARR as the annualized recurring revenue run-rate of Cloud subscription agreements at a point in time. We calculate Cloud ARR by taking the Cloud monthly recurring revenue ("Cloud MRR") run-rate and multiplying it by 12. Cloud MRR for each month is calculated by aggregating monthly recurring revenue from committed contractual amounts at a point in time. Cloud ARR and Cloud MRR should be viewed independently of revenue and do not represent our revenue under GAAP, as they are operational metrics that can be affected by contract start and end dates and renewal rates.

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Investor Relations Contact

Martin Lam

IR@atlassian.com

Media Contact

Marie-Claire Maple

press@atlassian.com