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Surging enterprise subscription sales continue to propel Sydney-based software giant Atlassian (NASDAQ: TEAM), with revenue soaring 21 per cent year-on-year to reach US$1.29 billion ($2 billion) for the second quarter of FY25.
Subscription revenue, which includes cloud-based products such as project management software Jira, visual collaboration platform Trello and AI-powered tool Rovo, saw a 31 per cent year-on-year increase to hit US$1.21 billion ($1.94 billion).
The quarter saw the productivity software company close a record number of deals greater than $1 million ($1.6 million) in annual contract value.
The news comes almost three months after Atlassian posted total sales had reached US$1.19 billion ($1.8 billion) in the September quarterdue to growth in its cloud and data centre offerings.
Net income for the latest quarter came in at US$255.6 million ($411.2 million), reflecting a 29 per cent boost from US$189.5 million ($304.8 million). Meanwhile, net loss was recorded at US$38.2 million ($61.4 million) – an improvement on the previous loss of US$84.5 million ($135.9 million).
Atlassian also reported that cash and marketable securities totalled US$2.5 billion ($4 billion).
“Strong enterprise sales execution drove better-than-expected revenue across both our Cloud and Data Center offerings, as we delivered 30 per cent year-over-year growth in subscription revenue in the second quarter,” Atlassian CFO Joe Binz said.
“The momentum we’re seeing across the business reinforces our conviction around investments we are making in our key strategic priorities of serving enterprise customers, AI, and the System of Work to deliver durable, long-term growth.”
Three months ago, Atlassian joined other tech giants in embracing artificial intelligence with the launch of Rovo – a product designed to help users search across data, tools, and platforms, gain AI-driven insights from company data and reduce repetitive tasks through specialised agents.
Other products under Atlassian’s portfolio include Jira, digital workplace tool Confluence and video messaging tool Loom – all of which are included in the company’s ‘System of Work’ - a suite of tools that helps teams collaborate, track projects, manage code and automate workflows across various industries.
For the third quarter of FY25, Atlassian is forecasting total revenue to land between US$1.34 billion ($2.15 billion) and US$1.35 billion ($2.17 billion), reflecting an increase of 18.5 per cent to 19 per cent. Cloud revenue is anticipated to grow by 23.5 per cent year-on-year, while the company is anticipating a seven per cent boost in data centre revenue.
“The Atlassian System of Work is resonating with enterprises all over the globe, as business leaders increasingly turn to the Atlassian platform to help teams across their organisation collaborate on the opportunities and challenges they face,” Atlassian co-founder and CEO Mike Cannon-Brookes said.
“By infusing AI throughout our world-class cloud platform, we’re empowering all teams to accelerate collaboration and unlock organisational knowledge, further enabling them to unleash their full potential.”
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