ATLASSIAN VALUE FALLS BY BILLIONS
ATLASSIAN co-chief executives Mike Cannon-brookes and Scott Farquhar were counting the cost on Friday after the company swung to an annual operating loss and posted earnings and revenue that missed market expectations.
Atlassian shares, which are listed on the US Nasdaq, dropped as much as 25 per cent after the market closed on Friday morning (AEDT), suggesting a loss of almost $Us10bn ($A15.8bn) from the company’s valuation.
Atlassian posted an operating loss on Friday of $US34M for the first quarter of financial year 2023, compared with operating income of $US56.5M a year earlier, while total revenue was up 31 per cent to $US807.4M. It posted a net loss of $US13.7M, from a net loss of $US411.2M a year earlier.
The company’s chiefs blamed macroeconomic headwinds for dual trends of fewer “free” instances converting to paid plans, and shrinking paid user growth from existing customers. They decreased revenue guidance for the full-year.
Mr Cannon-brookes and Mr Farquhar had each already seen more than $10bn wiped from their estimated wealth this year amid a torrid period for tech companies.
As of August, the co-founders held about 43 per cent of Atlassian shares, but had planned to sell a portion over the next 12 months.
Friday’s share price drop has cost the duo an estimated $5bn in combined wealth.
“Companies in nearly every industry are facing headwinds, and we’re beginning to see the impact on our business,” the co-ceos wrote in a letter to shareholders.
“The two trends are the result of companies tightening their belts and slowing their pace of hiring. In other words, Atlassian is not immune to broader macroeconomic impacts. Our outlook assumes
these trends will persist, but we’ll monitor, respond, and keep you updated accordingly.
“Turbulent markets provide an opportunity to shake up the leaderboards, and we are poised to play offence in this environment.”