Kaushik
Equity Research Writer for Wiseman Capital
Atlassian's quarter was hard to fault: beyond a revenue beat and raise, the bottom line, GAAP operating margin, RPO and cloud revenue were all good. The Q1 FY27 guide of 19.5% year-over-year growth at the midpoint looks conservative for the start of the year, and vibe-coded tools are no real threat to replace Jira. x.com x.com x.comÂ
Atlassian's results show AI boosting the business rather than hurting it, corroborating all eight qualitative estimates made in the original thesis. x.comÂ
Atlassian has broken out of a year-long downtrend on cloud and AI growth, with Q3 results up 29%, a Leader rating in Gartner's 2026 DevSecOps Magic Quadrant and Wall Street lifting targets. It is retesting the top of its descending channel as support, and heavy volume shows real accumulation. A move above $96.50 targets $119.38, then $139.70 and $157.29. x.comÂ
Atlassian's rally is hard to justify as growth heads to the teens. Revenue grew 28% last quarter and 26% for FY26, but Q1 FY27 is guided to 19.7% and full FY27 implies about 13%. With EV/sales still in single digits, the stock is probably at fair value for high-teens growth. In some places git is replacing Jira, which is ancient technology. x.com x.com x.com x.comÂ
Atlassian is flagged as bullish with no reason given, only a ticker mention and a link. x.comÂ
Atlassian got too cheap at 2x next-12-month revenue going into earnings and could re-rate to 4-5x, even after a 24% jump that still leaves it 85% below its highs. AI may pressure such companies, but that isn't showing up yet, and the market may be wrong that they won't adapt; some will get stronger by integrating AI. After $114, $139, the February 2025 VWAP and about 5x forward revenue, is a reasonable target. x.com x.comÂ
Atlassian is hard to buy despite strong contracted demand, because insiders have sold so heavily. Remaining performance obligations, contracted revenue not yet recognized and a precursor to reported revenue, accelerated sharply in Q2 2026. Even so, it does not look like the best opportunity in the market. x.com x.comÂ
Atlassian at $57-60 trades near decade lows while still growing 24%, and could reach $200+ in a few years if software becomes the next bubble after semiconductors. Its own AI agents, such as Rovo, are a plus. A replier who works in software warns that big-company contract cancellations slated for 2027 could be high, though that may already be in the price. x.com x.com x.comÂ
Software is flexing its muscles, showing AI is not killing the sector. Twilio, Atlassian, Cloudflare and JFrog all showed better-than-expected fundamental strength, setting software up for a strong session. x.com x.comÂ
Atlassian is not a buy even after an ~80% drawdown since January 2025 to an $18b market cap. Its products aren't that great, and it lacks the customer lock-in that Salesforce enjoys. x.comÂ
Atlassian is disproving the narrative that AI kills its business, with remaining performance obligations up 44% year over year in Q4 FY26. That makes two of the last four quarters against the narrative, and four and a half years after ChatGPT launched, the platform is still compounding. x.comÂ
