Atlassian stock jumped as much as 10 percent in extended trading after the collaboration software supplier disclosed fiscal second-quarter earnings that beat expectations and boosted its subscription revenue outlook.
Atlassian, the Australian software company forecasted a 50 percent gain in subscription revenue for the full fiscal year, up from a previous growth forecast in the mid-40s.
Subscriptions account for 86 percent of overall revenue.
Atlassian reported deferred sales of $975.5 million, which was more than the StreetAccount average of $971.0 million.
The company, which has its US head office in San Francisco, is increasing the prices of its data center and server products next month.
According to the company, the price increases will vary from 10 percent to 25 percent and will not affect customers who utilize Atlassian’s cloud services.
While Atlassian exceeded expectations on key financial indicators, the business only had 226,521 customers at the end of the quarter, compared to the StreetAccount estimate of 237,100.
The so-called “great resignation” trend of employees quitting jobs has not occurred at Atlassian, according to Scott Farquhar, co-founder and co-CEO of the firm, who during a conference call with analysts said: “We have noticed some slight upticks in compensation,”
Atlassian announced the acquisition of virtual agent startup Percept.ai on January 27, 2022, which the company said is “bolstering our investments in automation and machine learning.”
Atlassian shares have plummeted roughly 23 percent since the start of the year, excluding the after-hours spike, while the S&P 500 index has fallen around 9 percent.
Atlassian has been caught in a sweeping sell-off of fast-growing cloud-software stocks, as investors seek lower-risk assets in the face of rising interest rates.
ServiceNow and Qualtrics both popped after beating estimates in their quarterly results.
In the coming weeks, investors will be looking at earnings reports from a number of cloud companies as an early indicator of how well the businesses are holding up as the economic and fiscal landscape shifts.