Atlassian Corp. (NASDAQ:TEAM) Q4 2025 Earnings: Revenue and EPS Beat Amid Mixed Market Reaction

Atlassian Corp. (NASDAQ:TEAM) Reports Q4 2025 Earnings: Mixed Market Reaction Despite Revenue and EPS Beat

Atlassian Corp. released its fourth-quarter fiscal 2025 results, posting revenue of $1.38 billion, a 22% year-over-year increase, and non-GAAP earnings per share (EPS) of $0.98. Both figures surpassed analyst expectations, which had projected revenue of $1.38 billion and EPS of $0.87. Despite the beat, the stock saw a 2% decline in after-hours trading, suggesting investor concerns beyond the headline numbers.

Key Financial Highlights

• Revenue Growth: Total revenue rose to $1.38B, up from $1.13B in Q4 2024.
• Cloud Revenue: Increased 26% YoY to $928M, driven by strong enterprise adoption.
• Profitability: Non-GAAP operating margin improved to 24%, up from 20% a year ago.
• Free Cash Flow: Generated $360.3M in Q4, with a free cash flow margin of 26%.

For the full fiscal year, Atlassian reported $5.2B in revenue (up 20% YoY) and $3.68 in non-GAAP EPS, compared to $2.93 in FY2024.

Market Reaction: Why the Dip?

Despite beating estimates, the stock’s after-hours decline may reflect:

1. GAAP Losses: While non-GAAP profitability improved, the company still reported a GAAP net loss of $23.9M (vs. a $196.9M loss in Q4 2024).
2. Forward Guidance: Atlassian expects Q1 2026 revenue between $1.395B and $1.403B, slightly below some analyst expectations.
3. AI Monetization Uncertainty: While CEO Mike Cannon-Brookes highlighted 2.3M monthly AI users, investors may be waiting for clearer signs of AI-driven revenue acceleration.

Strategic Developments

• Google Cloud Partnership: Expanded collaboration to integrate Atlassian’s AI tools with Google’s infrastructure.
• Enterprise Growth: Customers with >$10K in Cloud ARR grew 13% YoY to 51,978.
• Leadership Transition: President Anu Bharadwaj will depart by year-end after 12 years with the company.

Outlook vs. Analyst Estimates

Atlassian’s FY2026 revenue growth target of ~18% aligns closely with consensus estimates of $6.28B in sales. However, the market may be weighing near-term execution risks against long-term AI and cloud expansion opportunities.

For more detailed earnings estimates and historical performance, view the full breakdown here.

Disclaimer: This article is not investment advice. Investors should conduct their own research before making decisions.