Shares in Australian workplace software company Atlassian have tumbled nearly 10 per cent in after-hours trading in the US after the company underwhelmed investors with its outlook for the rest of the fiscal year.
Atlassian, which makes a suite of enterprise software products including project management tool JIRA, generated revenue of $US309 million ($430 million) for the March quarter, up 38 per cent on the same period a year earlier.
Mike Cannon-Brookes is the co-founder and co-CEO of Atlassian.Credit: Louie Douvis
"Atlassian is driving flat tack (Australian speak for 'at maximum speed') towards the future as we work to unleash the potential of every team," co-chief executives Mike Cannon-Brookes and Scott Farquhar said in a letter to shareholders.
The company posted a quarterly loss of $US203 million, or $US0.85 a share. However, that includes a $US173 million non-cash charge relating to convertible notes the company issued, which had increased in value due to its rising share price.
Once that charge, and share-based compensation to employees are taken into account, Atlassian posted a quarterly profit of $US52.4 million, which was better than analyst expectations.
Atlassian added 5083 customers during the March quarter, bringing its total customer count to 144,038.
The company said it expected revenue for its fiscal year, which ends in June, to be in the range of $US1.205 billion to $US1.207 billion, and for earnings to be $US0.82 a share.
That fell short of consensus expectations for full-year earnings of $US0.92 a share, according to S&P Capital IQ.
Atlassian shares have soared 79 per cent over the past 12 months, compared to a 7 per cent rise for the US S&P 500 Index, with investors drawn to its surging revenue growth and encouraged by its deepening push into serving IT help desks that deal with service outages.
The share price rise has pushed the company's market value as high as $US27.6 billion. Last week, once exchange rates were factored in, Atlassian was briefly more valuable than telecommunications giant Telstra.
Cannacord Genuity analyst Richard Davis told clients he was not concerned about the result. "Like just about every public software stock, [Atlassian] is very highly valued on a near-term basis."
"[W]e have no fear that Atlassian’s fundamental outlook has, or is about to, dim," he wrote. "While no company is bulletproof, Atlassian comes about as close as any company we
track."