shares soar after collaboration software provider like Jira and Trello better than expected results. The company had stumbled in recent quarters when it switched to a cloud-based software model, but it seems to have solved its problems.
For its fiscal fourth quarter ended June 30, the Sydney-based company posted revenue of $560 million, up 30% from a year ago, and well above the Wall Street consensus of $524 million. On an adjusted basis, earnings were 24 cents per share, above the consensus of 18 cents.
For the full fiscal year, the company had revenue of $2.1 billion, an increase of 29%. According to International Financial Reporting Standards, the global equivalent of GAAP, the company lost $213 million, or 85 cents per share.
The company said it added a net total of more than 23,000 customers in the quarter, increasing its customer base to more than 200,000.
For the September quarter, Atlassian (ticker: TEAM) expects revenue of $575 million to $590 million. That’s well above the prior consensus forecast of $541 million. Adjusted earnings are expected to be 38 to 39 cents per share, ahead of the Street’s call for 31 cents.
“Q4 was a great quarter — a ripper as we Aussies say,” co-CEOs Scott Farquhar and Mike Cannon-Brookes said in a letter to shareholders. “We have entered fiscal 2021 and have brushed aside uncertainty and braced ourselves against headwinds. We are leaving it in a stronger position than ever. Over the past year, we’ve taken swift, bold action to continue our evolution into a cloud-first company and continue our mission to unleash the potential of every team. And it pays off.”
The Street seems to agree with him.
In a research note, Citi analyst Tyler Radke pointed out that the company saw year-over-year growth in subscription revenue accelerate again to 50%, its best level in six quarters, “driven by the impact of cloud strength and continued momentum from the data center.” He said the company’s cloud growth rose to 47%, from 35% a quarter earlier, with 70% growth in customers with more than 1,000 users.
“The cloud transition at Atlassian appears to be at a turning point and appears to be happening faster than investors expect, which we believe will keep stocks rising,” Radke wrote. He reiterated his buy recommendation for Atlassian stocks and raised his price target from $322 to $400.
Atlassian shares rose 24% to $331.31.
Canaccord Genuity analyst David Hynes was equally impressed and reiterated his buy recommendation, raising his target from $275 to $325. would be a little more choppy than before,” he said in a research note. “Perhaps the positive surprise was a masterclass in expectation management, but more likely, the company has built cloud products that customers want.”
Write to Eric J. Savitz at email@example.com