Atlassian forecasts downbeat quarterly revenue

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(Reuters) -Atlassian projected first-quarter revenue below estimates on Thursday, as enterprise customers cut spending on cloud software services in a tough economy.

Macroeconomic uncertainty and challenged IT budgets are forcing businesses to dial back their expenses on paid premium cloud services.

Contract negotiations also appear to favor longer and larger contract terms, as customers look to negotiate greater concessions from vendors, such as better pricing, increased support and professional services, according to analysts.

Some customers are also considering pulling forward spending that was planned for 2026 into this year to get ahead of potential adverse changes on the trade and geopolitical fronts, analysts have said. 

Atlassian’s collaboration tools — such as Jira software for planning and project management and Confluence for content creation — serve over 300,000 customers.

Its latest offering, Rovo — released in October 2024 with a higher price tag than its other products — is an AI assistant that allows users to do enhanced search, learning and automation across enterprise data.

For the first quarter of fiscal 2026, Atlassian sees revenue in the range of $1.395 billion to $1.403 billion, while analysts expect $1.412 billion, according to data compiled by LSEG. 

It expects fiscal 2026 revenue growth of 18%, compared with analysts’ estimates of a growth of 18.7%.

Atlassian’s revenue for the three months ended June 30 stood at $1.38 billion, compared with an estimate of $1.36 billion. 

(Reporting by Juby Babu in Mexico City; Editing by Alan Barona)