TEAM earnings analysis
What we found in TEAM's 10-K: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Atlassian delivered strong fiscal 2026 growth, with revenue up 26% to $6.572B, Cloud revenue up 28% to $4.411B, gross margin expanding to 85%, and GAAP operating results approaching breakeven. The company is reallocating resources toward Cloud, AI, enterprise sales, and a broader system-of-work platform, supported by substantial free cash flow and $1.8B of buybacks. However, the Data Center end-of-life program, sizable AI and infrastructure spending, major restructuring, and leadership turnover create meaningful execution risks; the 10-K provides no numerical forward guidance.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue growth remained strong
- Fiscal 2026 revenue increased 26% to $6.572B from $5.215B in fiscal 2025 and $4.359B in fiscal 2024. Subscription revenue rose 27% to $6.262B, while more than 90% of fiscal 2026 revenue came from customer accounts existing on or before June 30, 2025.
- Cloud transition is gaining scale
- Cloud revenue increased 28% to $4.411B in fiscal 2026 from $3.447B, exceeding Data Center growth of 25% to $1.831B. Customers with more than $10,000 of Cloud ARR increased from 45,842 in fiscal 2024 to 57,334 in fiscal 2026.
- Margins and EPS materially improved
- GAAP gross margin improved to 85% in fiscal 2026 from 83% in fiscal 2025, while operating results improved from a $130.4M operating loss to $10.4M of operating income. GAAP diluted loss per share improved to $0.21 from $0.98 in fiscal 2025 and $1.16 in fiscal 2024.
- Strong cash generation despite decline
- Free cash flow remained substantial at $1.319B in fiscal 2026, although it declined from $1.416B in fiscal 2025. Capital expenditures were only $34.1M in fiscal 2026 versus $44.9M in fiscal 2025.
- Platform and AI roadmap expanded
- Atlassian is positioning an interconnected portfolio of apps, AI agents, and Collections on a common Cloud Platform and data model. It completed the $488.3M BCNY acquisition for an AI-era enterprise browser and the $720.4M DX acquisition for engineering intelligence during fiscal 2026.
- Aggressive buybacks supported per-share value
- The company repurchased approximately 19.1M Class A shares for $1.8B in fiscal 2026 at an average price of $94.31, with $1.9B remaining under the $2.5B 2025 Repurchase Program. It also had no borrowings under its $750M revolving credit facility at June 30, 2026.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Data Center phase-out creates transition risk
- Atlassian no longer sells Data Center term licenses to new customers as of March 2026, will stop selling term licenses and expansions to existing customers in March 2028, and plans to end maintenance and support in March 2029. Management warns that migration incentives, lower initial Cloud revenue, higher hosting costs, and customers declining to migrate could pressure near-term growth and margins.
- AI investment may not monetize
- The company is making significant AI investments and provides Rovo at no additional cost to premium, enterprise, and standard customers across Jira, Confluence, Jira Service Management, and Teamwork Collection. The filing states these investments are expected to negatively impact operating margins in the near term, while AI-related revenue monetization and customer adoption remain uncertain.
- Large restructuring and leadership changes
- Fiscal 2026 restructuring eliminated roles affecting approximately 10% of the workforce and generated $285.4M of restructuring charges, including $203.9M of severance and $80.0M of lease impairment charges. The filing also notes that the former President, CFO, and CTO stepped down during fiscal 2026, increasing execution and retention risk during the Cloud, AI, and enterprise-sales transformation.
- High channel-partner dependence
- The company derived over 50% of fiscal 2026 revenue from channel partners’ sales efforts, but its solution-partner agreements are non-exclusive and partners may stop marketing Atlassian offerings with limited or no notice. This creates material dependence on third-party distribution and collection performance.
- Commitments and working capital exposure
- Atlassian had $1.2B of cash and cash equivalents but also $1.3B of accounts receivable at June 30, 2026. Contractual purchase obligations totaled $4.695B, including $3.735B of other commitments and $959.8M for leases not yet commenced, limiting flexibility if growth or collections weaken.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $-0.21
- Gross margin
- 85%
- Operating margin
- 0%
- Segment
- Single reportable segment; Cloud revenue $4.411B, Data Center revenue $1.831B, and Marketplace and other revenue $330.7M in fiscal 2026
- Segment
- Americas revenue $3.166B, EMEA revenue $2.693B, and Asia Pacific revenue $713.4M in fiscal 2026
What they said about what is next.
The 10-K provides no numerical annual revenue or EPS guidance. Management expects subscription revenue, particularly Cloud revenue, to increase, but expects gross margin to decline slightly in fiscal 2027 because of the Data Center-to-Cloud mix shift, higher Cloud and AI infrastructure costs, and the comparison against upfront Data Center license revenue.
The filing reads better than the one before it.
What came before.
- 10-Q · May 1, 2026
- Atlassian reported strong Q3 FY2026 results with revenue reaching $1.787 billion, a 32% increase year-over-year, surpassing expectations by 5.3%. EPS of $1.75 significantly beat estimates, achieving a surprise of 60.6%.…
- 10-K · August 15, 2025
- Atlassian positions itself as a platform-driven, AI-first provider of team collaboration software, shifting in fiscal 2025 from standalone products to interconnected apps, AI agents (Rovo), and Collections built on the…
- 10-Q · May 2, 2025
- Atlassian reported total revenue of $1,356,716,000 for the three months ended March 31, 2025, up $167,588,000 (+14.1%) versus the prior-year quarter, driven by subscription revenue growth. Gross margin expanded to 83.8%…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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