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    TEAM
    Earnings call· Jun 2026(Q4 FY26)

    Atlassian Q4 FY26 earnings call TEAM

    Aug 6, 2026 Source

    Executive summary

    Atlassian Q4 FY26 — Accelerating Cloud Growth and AI Monetization

    Atlassian concluded FY26 with an outstanding quarter, marked by accelerating cloud revenue and robust RPO growth, driven by strong enterprise adoption and AI monetization. The company's Teamwork Graph is proving a key differentiator, enhancing AI accuracy and efficiency for customers. While maintaining a prudent outlook for FY27 subscription ARR growth due to macro factors, Atlassian remains committed to durable profitable growth through disciplined investments and cost management.

    Highlights

    5

    • Total revenue grew 28% to $1.8 billion.

    • Cloud revenue surged to $1.2 billion, accelerating to 31% year-over-year growth.

    • Remaining Performance Obligations (RPO) grew 44% year-over-year to $4.8 billion.

    • Rovo assisted actions grew 50% quarter-over-quarter, with adopters growing ARR more than twice as fast as non-adopters.

    • Achieved a GAAP operating margin of 12% for the quarter, demonstrating durable profitable growth.

    Concerns

    1

    • FY27 subscription ARR growth is guided at 18%, down from FY26's 23%, reflecting a prudent approach amidst macro uncertainty and lapping a 1-point benefit from the DX acquisition.

    Guidance & targets

    3
    CategoryTargetConfidence
    Subscription ARR growth
    18%
    high materiality
    Medium
    GAAP operating margin
    6.5%
    medium materiality
    High
    GAAP operating margin
    4.5%
    high materiality
    High

    Operational metrics

    14
    Total Revenue
    $1.8 billionup 28% year-over-year
    Q4 FY26

    Total revenue grew 28% to $1.8 billion.

    Cloud Revenue
    $1.2 billionup 31% year-over-year
    Q4 FY26

    Cloud revenue surged to $1.2 billion as growth accelerated again, up 31% year-over-year.

    Rovo Assisted Actions Growth
    50%over the prior quarter
    Q4 FY26

    Rovo assisted actions grew 50% over the prior quarter

    Rovo Adopters ARR Growth vs Non-Adopters
    more than twice the rate
    Q4 FY26

    Rovo adopters that is customers using Rovo continue to grow their ARR at more than twice the rate of non-adopters.

    $3M ARR Customers Growth
    over 50%year-on-year
    Q4 FY26

    With our $3 million ARR customers growing over 50% year-on-year

    $5M ARR Customers Growth
    over 70%year-on-year
    Q4 FY26

    and our $5 million ARR customers growing over 70%.

    Teamwork Customers Paid Seats per Instance
    4 to 5x morethan stand-alone Jira or Confluence customers
    Q4 FY26

    Teamwork customers having 4 to 5x more paid seats per instance than stand-alone Jira or Confluence customers.

    Agentic Automation Increase in Service Collection
    over 3x
    Q4 FY26

    we're seeing over 3x increase in Agentic automation in Service collection as customers are continuing to deploy more agents beyond IT teams in HR and legal and finance and marketing teams.

    MCP and CLI Users
    over 1 millionmore than doubling in the quarter
    Q4 FY26

    MCP and CLI users in the quarter, passing 1 million now. ... more than doubling in the quarter

    MCP Calls Growth
    400%in the quarter
    Q4 FY26

    MCP calls were up 400% in the quarter with daily blip and people actually using the applications through the label through a mobile client.

    Cloud Revenue Beat vs. Expectations
    $49 million
    Q4 FY26

    on the cloud revenue drivers here on the $49 million beat

    Cloud Growth Revenue from DC Migrations
    mid- to high single digits
    FY26

    contributing approximately mid- to high single digits to the cloud growth revenue.

    Fortune 500 Penetration
    85%
    Q4 FY26

    we're in 85% of the Fortune 500, but really that only represents roughly 10% or so of our total revenue.

    Knowledge Workers as % of Jira/Confluence Users
    roughly 2/3
    Q4 FY26

    roughly 2/3 of users across Jira and Confluence or knowledge workers

    Industry KPIs

    9
    MetricValueDetails
    Revenue growth$1.8 billionUSD
    Arr net new arr23%%
    Rpo current rpo$4.8 billionUSD
    Customer account count—
    Large deal new logo metricsall-time record
    Multi product platform attach4 to 5x more
    Operating FCF margin rule of 4012%%
    Ai product adoption monetization80%%
    Net revenue net dollar retentionnorth of 120%%

    Orderbook & backlog

    1
    Remaining Performance Obligations (RPO)$4.8 billionQ4 FY26

    grew 44% year-over-year

    Product announcements

    4
    ProductTypeDetails
    Rovomilestone
    Service Collectionmilestone
    Teamwork Graph (MCP server, CLI)expansion
    AI Agents (Cursor, Claude, GitHub)expansion

    Deals & partnerships

    1
    DXAcquisition that benefited FY26 ARR growth

    Acquisition of DX at the close of November in 2025 (fiscal Q2) contributed to FY26 ARR growth.

    Risks & headwinds

    2
    Macroeconomic uncertainty, fiscal policy, and geopolitical landscapeFY27

    uncertainty

    Mitigation: Prudent approach to FY27 guidance, balancing momentum with external factors.

    Lapping the benefit from DX acquisition in FY26FY27

    approximately 1 point (impact on FY26 ARR growth)

    Mitigation: Considered in the prudent FY27 ARR guidance.

    What to watch in Q1 FY27

    5

    Subscription ARR growth

    FY27
    Current23% (FY26)
    Target18% (FY27 guide)

    Why it matters

    This is a key indicator of the company's core growth trajectory and management's prudence in forecasting amidst macro uncertainties.

    And you again had another way down to year 23% growth for the fiscal year '27 guide is down to 18%.

    Q&A highlights

    5

    Why is FY27 subscription ARR guidance (18%) lower than FY26 growth (23%)? Is it due to macro, new seat expansion, or enterprise go-to-market scaling?

    James Chuong explained the prudent approach due to macro uncertainty, lapping the 1-point benefit from the DX acquisition in FY26, and being early in the fiscal year. He reiterated confidence in the business momentum (23% ARR growth, 44% RPO, >120% NRR).

    “When it comes to the guide, we'll continue to take a thoughtful and prudent approach here, really balancing the momentum that we're seeing in the business, the demand signals that we're getting from our customers with the uncertainty as you look out in the macro environment, fiscal policy and geopolitical landscape.”

    asked by Adam Wood · answered by James Chuong

    2 min read5 chapters

    Detailed Narrative

    01

    AI-Driven Growth and Contextual Advantage

    Atlassian's AI offering, Rovo, is a significant growth driver, with over 80% of Fortune 500 companies using it and assisted actions growing 50% quarter-over-quarter. Rovo adopters demonstrate more than double the ARR growth of non-adopters. This success is attributed to Atlassian's "Teamwork Graph," which leverages 25 years of deep data to provide highly accurate AI answers (up to 44% more accurate) while consuming fewer tokens (48% reduction), creating a compounding differentiator.

    02

    Enterprise Momentum and Strategic Partnerships

    The company achieved record performance in large deals, with $3 million ARR customers growing over 50% and $5 million ARR customers growing over 70% year-over-year. This enterprise momentum is a result of sustained investment in technology (e.g., compliance for Rovo) and human-centric enterprise connectivity over several years, rather than a single "unlock." The platform is increasingly seen as a strategic piece in customers' technology estates, leading to longer and larger deals.

    03

    Cloud and Collection Adoption

    Cloud revenue accelerated to 31% year-over-year, reaching $1.2 billion. This growth was primarily driven by strong cross-sell and seat expansion, particularly within the Service Collection and Teamwork Collection. The Service Collection saw over a 3x increase in Agentic automation, expanding beyond IT to HR, legal, and finance teams. The Teamwork Collection remains the primary vehicle for AI adoption, driving ARPU uplift as customers upgrade for increased Rovo credits and predictability.

    04

    Durable Profitable Growth and Margin Management

    Despite increased AI usage, Atlassian maintains a focus on durable profitable growth, evidenced by a 12% GAAP operating margin in Q4 FY26. The company attributes this to a disciplined hiring approach, strategic resource reallocation, and moderating stock-based compensation. Significant R&D efforts have focused on optimizing the cost-to-serve for AI, blending multiple models, and managing traffic costs, ensuring high-quality AI answers at competitive prices.

    05

    Expanding User Base and System of Work

    Atlassian's user base continues to diversify, with roughly two-thirds of Jira and Confluence users being knowledge workers outside of software development. This broad-based expansion across HR, legal, and finance teams highlights the increasing need for collaboration tools at enterprise scale. The "system of work" strategy aims to connect technology teams with business teams on a single platform, supporting organizations where technology is a key competitive advantage, regardless of their core industry.

    AI-generated summary of the company’s earnings call. Not investment advice.