Nearly 20 years on, Atlassian's revenue is continuing to skyrocket - and the losses too

Atlassian continues to grow rapidly, with quarterly revenue up 34% on 12 months ago.

Releasing its first quarter FY22 results today, Nasdaq-listed Australian tech company posted revenue of US$614 million, with quarterly subscription revenue up 57% year-on-year to US$435 million.

But the company’s losses remain equally impressive, with a net loss of US$400.1 million for Q1 FY22, compared with a net loss of $21.6 million 12 months ago, for a net loss per diluted share was $1.59 (FY20 Q1 $0.09 ).

The company said the loss included a charge of US$424.5 million recorded in “other non-operating expense, net”, compared with a charge of $27.5 million in Q1 FY21, relating to Atlassian’s exchangeable senior notes and related capped calls.

Of that amount, a US$370.4 million loss is related to marking to fair value the exchange feature of the notes and related capped calls that remain outstanding as of quarter end. An additional US$54.1 million net loss is related to the net impact of settling the early exchange requests of the notes and unwinding of the related capped calls during the quarter.

Operating income was US$39.6 million for Q1 FY22, compared with $11.9 million Q1 FY21. Operating margin doubled to 6%, compared with 3% 12 months ago.

Atlassian drew US$650 million from the term loan facility during the quarter using US$314.3 million in cash to settle the early exchange requests of the notes and received $31.0 million in cash from the unwinding of the related capped calls.

The net impact resulted in cash inflows of $366.7 million.

The company announced the CFO James Beer will retire at the end of the financial year in June 2022 after more than six years in the role.

“After 18 years as a public company CFO in three different industries and having celebrated my 60th birthday earlier this year, it is the right time for me to retire and pass the baton to the next leader,” Beer said.

“Atlassian has terrific momentum, including the contributions of a very strong finance team, and is exceptionally well positioned to continue executing on its mission.”

Atlassian’s co-founder and co-CEO Scott Farquhar said the business continues to deliver value to its customers and innovate across all three core markets.

“One example we’re most proud of is Jira Service Management being named the sole visionary in Gartner’s 2021 Magic Quadrant for IT Service Management Tools in its inaugural year in market,” he said.

The business predicts that total revenue in the range of US$630-645 million in Q2.

Net loss per diluted share is expected to be in the range of ($0.42) to ($0.39) on an IFRS basis.

The business now has nearly 7,000 employees, more 216,000 customers, and is on track for an annualised revenue run rate of $2.5 billion.