Quarterly revenue of $760 million, up 36% year-over-year
Quarterly subscription revenue of $597 million, up 55% year-over-year
Quarterly IFRS operating margin of (8)% and non-IFRS operating margin of 14%
Quarterly cash flow from operations of $230 million and free cash flow of $195 million
TEAM, Anywhere/SYDNEY–(BUSINESS WIRE)–Atlassian Corporation Plc (NASDAQ: TEAM), a leading provider of team collaboration and productivity software, today announced financial results for its fourth quarter and fiscal year ended June 30, 2022 and released a shareholder letter available on Atlassian�s Work Life blog at http://atlassian.com/blog/announcements/shareholder-letter-q4fy22. The shareholder letter was also posted to the Investor Relations section of Atlassians website at https://investors.atlassian.com.
We capped off fiscal year 2022 with strong Q4 results, growing Cloud revenue 55 percent year-over-year, said Mike Cannon-Brookes, Atlassians co-founder and co-CEO. We believe that Atlassian is uniquely positioned, with great momentum and a differentiated business model. While we cant predict what the future holds at a macro level, were forging ahead with conviction and vigilance as we look to deepen our strategic position.
Our strong competitive position provides us with the flexibility to invest purposefully and create value for our customers, said Scott Farquhar, Atlassians co-founder and co-CEO. Were proud of how we continue to execute against our long-term plans, which includes bringing on top-tier talent from across the globe. We added over 2,300 new Atlassians in fiscal year 2022, and they will be instrumental to helping us achieve our mission to unleash the potential of every team.
Fourth Quarter Fiscal Year 2022 Financial Highlights:
On an IFRS basis, Atlassian reported:
On a non-IFRS basis, Atlassian reported:
Fiscal Year 2022 Financial Highlights
On an IFRS basis, Atlassian reported:
On a non-IFRS basis, Atlassian reported:
A reconciliation of IFRS to non-IFRS financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below, under the heading About Non-IFRS Financial Measures.
Recent Business Highlights:
New Chief Financial Officer:
Atlassian announced that Joe Binz will join the company as its new Chief Financial Officer (CFO) and Principal Financial Officer, effective September 6, 2022. Joe brings more than 25 years of finance leadership and experience in the technology industry. Since 2014, he has held the role of Corporate Vice President, Finance at Microsoft Corporation, where he was responsible for leading the companys financial planning and analysis, investor relations, acquisition integration, and procurement functions. Over his twenty-year career with Microsoft, he was a pivotal finance leader where he most notably guided the companys business transformation through its multi-billion dollar move to the cloud. Prior to his time at Microsoft, Joe spent eight years at Intel Corporation where he held a variety of finance roles supporting manufacturing operations, product groups, and Intel Capital. He holds a Bachelor of Science in Finance from the University of Illinois Urbana-Champaign, and a Master of Business Administration from the University of Michigans Ross School of Business.
Financial Targets:
Atlassian is providing its financial targets for the first quarter of fiscal year 2023 as follows:
First Quarter Fiscal Year 2023:
For additional commentary regarding financial targets, please see Atlassians fourth quarter fiscal year 2022 shareholder letter dated August 4, 2022.
With respect to Atlassians expectations under Financial Targets above, a reconciliation of IFRS to non-IFRS gross margin, operating margin, and net income (loss) per diluted share, has been provided in the financial statement tables included in this press release.
Shareholder Letter and Webcast Details:
A detailed shareholder letter is available on Atlassians Work Life blog at https://atlassian.com/blog/announcements/shareholder-letter-q4fy22, and the Investor Relations section of Atlassians website at: https://investors.atlassian.com. Atlassian will host a webcast to answer questions today:
Atlassian has used, and will continue to use, its Investor Relations website at https://investors.atlassian.com as a means of making material information public and for complying with its disclosure obligations.
About Atlassian
Atlassian unleashes the potential of every team. Our team collaboration and productivity software helps teams organize, discuss, and complete shared work. Teams at more than 240,000 customers, across large and small organizations – including Bank of America, Redfin, NASA, Verizon, and Dropbox – use Atlassians project tracking, content creation and sharing, and service management products to work better together and deliver quality results on time. Learn more about our products, including Jira Software, Confluence, Jira Service Management, Trello, Bitbucket, and Jira Align at https://atlassian.com/.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. All statements other than statements of historical fact could be deemed forward looking, including risks and uncertainties related to statements about our products, business model, customers, employees, anticipated growth, outlook, technology and other key strategic areas, and our financial targets such as revenue, share count, and IFRS and non-IFRS financial measures including gross margin, operating margin, and net income (loss) per diluted share.
We undertake no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.
The achievement or success of the matters covered by such forward-looking statements involves known and unknown risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. You should not rely upon forward-looking statements as predictions of future events. Forward-looking statements represent our managements beliefs and assumptions only as of the date such statements are made.
Further information on these and other factors that could affect our financial results is included in filings we make with the Securities and Exchange Commission from time to time, including the section titled Risk Factors in our most recent Forms 20-F and 6-K (reporting our quarterly results). These documents are available on the SEC Filings section of the Investor Relations section of our website at: https://investors.atlassian.com/.
About Non-IFRS Financial Measures
Our reported results and financial targets include certain non-IFRS financial measures, including non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share, and free cash flow. Management believes that the use of these non-IFRS financial measures provides consistency and comparability with our past financial performance, facilitates period-to-period comparisons of our results of operations, and also facilitates comparisons with peer companies, many of which use similar non-IFRS or non-GAAP financial measures to supplement their IFRS or GAAP results. Non-IFRS results are presented for supplemental informational purposes only to aid in understanding our results of operations. The non-IFRS results should not be considered a substitute for financial information presented in accordance with IFRS, and may be different from non-IFRS or non-GAAP measures used by other companies.
Our non-IFRS financial measures include:
Our non-IFRS financial measures reflect adjustments based on the items below:
We exclude expenses related to share-based compensation, amortization of acquired intangible assets, non-coupon impact related to exchangeable senior notes and capped calls, the related income tax effects on these items, and discrete tax impact resulting from a non-recurring transaction from certain of our non-IFRS financial measures as we believe this helps investors understand our operational performance. In addition, share-based compensation expense can be difficult to predict and varies from period to period and company to company due to differing valuation methodologies, subjective assumptions, and the variety of equity instruments, as well as changes in stock price. Management believes that providing non-IFRS financial measures that exclude share-based compensation expense, amortization of acquired intangible assets, non-coupon impact related to exchangeable senior notes and capped calls, the related income tax effects on these items, and discrete tax impact resulting from a non-recurring transaction allow for more meaningful comparisons between our results of operations from period to period.
Management considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that can be used for strategic opportunities, including investing in our business, making strategic acquisitions, and strengthening our statement of financial position.
Management uses non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share, and free cash flow:
The tables in this press release titled Reconciliation of IFRS to Non-IFRS Results and Reconciliation of IFRS to Non-IFRS Financial Targets provide reconciliations of non-IFRS financial measures to the most recent directly comparable financial measures calculated and presented in accordance with IFRS.
We understand that although non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share, and free cash flow are frequently used by investors and securities analysts in their evaluation of companies, these measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results of operations as reported under IFRS.
Atlassian Corporation Plc | |||||||||||||||
Consolidated Statements of Operations | |||||||||||||||
(U.S. $ and shares in thousands, except per share data) | |||||||||||||||
(unaudited) | |||||||||||||||
| Three Months Ended June 30, |
| Fiscal Year Ended June 30, | ||||||||||||
|
| 2022 |
|
|
| 2021 |
|
|
| 2022 |
|
|
| 2021 |
|
Revenues: |
|
|
|
|
|
|
| ||||||||
Subscription | $ | 597,297 |
|
| $ | 385,510 |
|
| $ | 2,096,706 |
|
| $ | 1,324,064 |
|
Maintenance |
| 117,095 |
|
|
| 131,080 |
|
|
| 495,077 |
|
|
| 522,971 |
|
Other |
| 45,449 |
|
|
| 42,949 |
|
|
| 211,099 |
|
|
| 242,097 |
|
Total revenues |
| 759,841 |
|
|
| 559,539 |
|
|
| 2,802,882 |
|
|
| 2,089,132 |
|
Cost of revenues (1) (2) |
| 133,154 |
|
|
| 97,967 |
|
|
| 465,707 |
|
|
| 336,021 |
|
Gross profit |
| 626,687 |
|
|
| 461,572 |
|
|
| 2,337,175 |
|
|
| 1,753,111 |
|
Operating expenses: |
|
|
|
|
|
|
| ||||||||
Research and development (1) (2) |
| 379,000 |
|
|
| 245,929 |
|
|
| 1,397,568 |
|
|
| 963,326 |
|
Marketing and sales (1) (2) |
| 179,308 |
|
|
| 133,429 |
|
|
| 567,691 |
|
|
| 372,909 |
|
General and administrative (1) |
| 131,632 |
|
|
| 89,740 |
|
|
| 478,373 |
|
|
| 315,242 |
|
Total operating expenses |
| 689,940 |
|
|
| 469,098 |
|
|
| 2,443,632 |
|
|
| 1,651,477 |
|
Operating income (loss) |
| (63,253 | ) |
|
| (7,526 | ) |
|
| (106,457 | ) |
|
| 101,634 |
|
Other non-operating expense, net |
| (327 | ) |
|
| (199,401 | ) |
|
| (434,588 | ) |
|
| (620,759 | ) |
Finance income |
| 1,332 |
|
|
| 1,008 |
|
|
| 2,297 |
|
|
| 7,174 |
|
Finance costs |
| (6,611 | ) |
|
| (8,099 | ) |
|
| (25,824 | ) |
|
| (122,713 | ) |
Loss before income tax benefit (expense) |
| (68,859 | ) |
|
| (214,018 | ) |
|
| (564,572 | ) |
|
| (634,664 | ) |
Income tax benefit (expense) |
| (36,604 | ) |
|
| 945 |
|
|
| (49,552 | ) |
|
| (61,651 | ) |
Net loss | $ | (105,463 | ) |
| $ | (213,073 | ) |
| $ | (614,124 | ) |
| $ | (696,315 | ) |
Net loss per share attributable to ordinary shareholders: |
|
|
|
|
|
|
| ||||||||
Basic | $ | (0.41 | ) |
| $ | (0.85 | ) |
| $ | (2.42 | ) |
| $ | (2.79 | ) |
Diluted | $ | (0.41 | ) |
| $ | (0.85 | ) |
| $ | (2.42 | ) |
| $ | (2.79 | ) |
Weighted-average shares outstanding used to compute net loss per share attributable to ordinary shareholders: |
|
|
|
|
|
|
| ||||||||
Basic |
| 254,482 |
|
|
| 251,264 |
|
|
| 253,312 |
|
|
| 249,679 |
|
Diluted |
| 254,482 |
|
|
| 251,264 |
|
|
| 253,312 |
|
|
| 249,679 |
|
(1) Amounts include share-based payment expense, as follows: | |||||||||||
| Three Months Ended June 30, |
| Fiscal Year Ended June 30, | ||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
Cost of revenues | $ | 11,641 |
| $ | 6,187 |
| $ | 44,848 |
| $ | 24,739 |
Research and development |
| 102,375 |
|
| 55,093 |
|
| 437,607 |
|
| 253,328 |
Marketing and sales |
| 26,356 |
|
| 16,754 |
|
| 109,338 |
|
| 46,978 |
General and administrative |
| 23,519 |
|
| 16,011 |
|
| 115,294 |
|
| 60,687 |
(2) Amounts include amortization of acquired intangible assets, as follows: | |||||||||||
| Three Months Ended June 30, |
| Fiscal Year Ended June 30, | ||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
Cost of revenues | $ | 5,697 |
| $ | 6,008 |
| $ | 22,694 |
| $ | 22,394 |
Research and development |
| 93 |
|
| 44 |
|
| 374 |
|
| 168 |
Marketing and sales |
| 2,491 |
|
| 2,298 |
|
| 9,330 |
|
| 9,192 |
Atlassian Corporation Plc | |||||||
Consolidated Statements of Financial Position | |||||||
(U.S. $ in thousands) | |||||||
| June 30, 2022 |
| June 30, 2021 | ||||
| (unaudited) |
|
| ||||
Assets |
|
|
| ||||
Current assets: |
|
|
| ||||
Cash and cash equivalents | $ | 1,385,265 |
|
| $ | 919,227 |
|
Short-term investments |
| 73,294 |
|
|
| 313,001 |
|
Trade receivables |
| 308,127 |
|
|
| 173,473 |
|
Tax receivables |
| 541 |
|
|
| 2,332 |
|
Derivative assets |
| 13,685 |
|
|
| 127,486 |
|
Prepaid expenses and other current assets |
| 58,077 |
|
|
| 48,322 |
|
|
| 1,838,989 |
|
|
| 1,583,841 |
|
Assets held for sale |
| 60,265 |
|
|
| 43,665 |
|
Total current assets |
| 1,899,254 |
|
|
| 1,627,506 |
|
Non-current assets: |
|
|
| ||||
Property and equipment, net |
| 98,554 |
|
|
| 66,221 |
|
Deferred tax assets |
| 42,760 |
|
|
| 36,174 |
|
Goodwill |
| 732,666 |
|
|
| 725,758 |
|
Intangible assets, net |
| 100,840 |
|
|
| 124,590 |
|
Right-of-use assets, net |
| 267,328 |
|
|
| 205,300 |
|
Strategic investments |
| 159,064 |
|
|
| 122,159 |
|
Other non-current assets |
| 60,740 |
|
|
| 37,636 |
|
Total non-current assets |
| 1,461,952 |
|
|
| 1,317,838 |
|
Total assets | $ | 3,361,206 |
|
| $ | 2,945,344 |
|
Liabilities |
|
|
| ||||
Current liabilities: |
|
|
| ||||
Trade and other payables | $ | 404,908 |
|
| $ | 266,497 |
|
Tax liabilities |
| 26,367 |
|
|
| 42,051 |
|
Provisions |
| 32,796 |
|
|
| 25,148 |
|
Deferred revenue |
| 1,066,059 |
|
|
| 812,943 |
|
Lease obligations |
| 40,638 |
|
|
| 42,446 |
|
Derivative liabilities |
| 23,288 |
|
|
| 772,127 |
|
Exchangeable senior notes, net |
| |
|
|
| 348,799 |
|
Total current liabilities |
| 1,594,056 |
|
|
| 2,310,011 |
|
Non-current liabilities: |
|
|
| ||||
Deferred tax liabilities |
| 26,457 |
|
|
| 26,625 |
|
Provisions |
| 13,804 |
|
|
| 12,435 |
|
Deferred revenue |
| 116,621 |
|
|
| 84,652 |
|
Term loan facility, net |
| 999,419 |
|
|
| |
|
Lease obligations |
| 274,434 |
|
|
| 214,103 |
|
Other non-current liabilities |
| 812 |
|
|
| 2,604 |
|
Total non-current liabilities |
| 1,431,547 |
|
|
| 340,419 |
|
Total liabilities |
| 3,025,603 |
|
|
| 2,650,430 |
|
Equity |
|
|
| ||||
Share capital |
| 25,485 |
|
|
| 25,164 |
|
Share premium |
| 461,044 |
|
|
| 461,016 |
|
Other capital reserves |
| 2,223,820 |
|
|
| 1,516,609 |
|
Other components of equity |
| 53,829 |
|
|
| 104,832 |
|
Accumulated deficit |
| (2,428,575 | ) |
|
| (1,812,707 | ) |
Total equity |
| 335,603 |
|
|
| 294,914 |
|
Total liabilities and equity | $ | 3,361,206 |
|
| $ | 2,945,344 |
|
Atlassian Corporation Plc | |||||||||||||||
Consolidated Statements of Cash Flows | |||||||||||||||
(U.S. $ in thousands) | |||||||||||||||
(unaudited) | |||||||||||||||
| Three Months Ended June 30, |
| Fiscal Year Ended June 30, | ||||||||||||
|
| 2022 |
|
|
| 2021 |
|
|
| 2022 |
|
|
| 2021 |
|
Operating activities |
|
|
|
|
|
|
| ||||||||
Loss before income tax benefit (expense) | $ | (68,859 | ) |
| $ | (214,018 | ) |
| $ | (564,572 | ) |
| $ | (634,664 | ) |
Adjustments to reconcile loss before income tax benefit (expense) to net cash provided by operating activities: |
|
|
|
|
|
|
| ||||||||
Depreciation and amortization |
| 13,753 |
|
|
| 14,172 |
|
|
| 51,163 |
|
|
| 55,296 |
|
Depreciation of right-of-use assets |
| 10,857 |
|
|
| 9,542 |
|
|
| 42,795 |
|
|
| 37,552 |
|
Share-based payment expense |
| 163,891 |
|
|
| 94,045 |
|
|
| 707,087 |
|
|
| 385,732 |
|
Net loss on exchange derivative and capped call transactions |
| |
|
|
| 200,513 |
|
|
| 424,482 |
|
|
| 616,446 |
|
Amortization of debt discount and issuance cost |
| 118 |
|
|
| 5,246 |
|
|
| 4,075 |
|
|
| 109,548 |
|
Interest income |
| (1,332 | ) |
|
| (1,008 | ) |
|
| (2,297 | ) |
|
| (7,174 | ) |
Interest expense |
| 6,493 |
|
|
| 2,852 |
|
|
| 21,749 |
|
|
| 13,164 |
|
Net foreign currency loss (gain) |
| (4,032 | ) |
|
| (2,525 | ) |
|
| (12,065 | ) |
|
| 7,650 |
|
Impairment of lease related assets |
| |
|
|
| 7,435 |
|
|
| |
|
|
| 7,435 |
|
Net unrealized loss on investments |
| |
|
|
| |
|
|
| 2,100 |
|
|
| 2,000 |
|
Net loss on sale of investments, disposal of assets and other |
| 1,021 |
|
|
| 9 |
|
|
| 3,189 |
|
|
| 1,144 |
|
Changes in assets and liabilities: |
|
|
|
|
|
|
| ||||||||
Trade receivables |
| (51,581 | ) |
|
| 19,687 |
|
|
| (134,764 | ) |
|
| (61,256 | ) |
Prepaid expenses and other assets |
| 4,055 |
|
|
| (2,002 | ) |
|
| (20,767 | ) |
|
| (13,054 | ) |
Trade and other payables, provisions and other non-current liabilities |
| 72,450 |
|
|
| 31,676 |
|
|
| 140,946 |
|
|
| 64,899 |
|
Deferred revenue |
| 90,594 |
|
|
| 23,558 |
|
|
| 284,937 |
|
|
| 294,371 |
|
Interest received |
| 367 |
|
|
| 2,041 |
|
|
| 2,086 |
|
|
| 12,513 |
|
Income tax paid, net |
| (7,398 | ) |
|
| (6,856 | ) |
|
| (66,648 | ) |
|
| (50,272 | ) |
Net cash provided by operating activities |
| 230,397 |
|
|
| 184,367 |
|
|
| 883,496 |
|
|
| 841,330 |
|
Investing activities |
|
|
|
|
|
|
| ||||||||
Business combinations, net of cash acquired |
| |
|
|
| (7,960 | ) |
|
| (12,377 | ) |
|
| (91,584 | ) |
Purchases of intangible assets |
| |
|
|
| (1,800 | ) |
|
| (4,018 | ) |
|
| (1,800 | ) |
Purchases of property and equipment |
| (24,648 | ) |
|
| (8,790 | ) |
|
| (70,583 | ) |
|
| (31,520 | ) |
Purchases of investments |
| (8,750 | ) |
|
| (25,912 | ) |
|
| (132,671 | ) |
|
| (119,431 | ) |
Proceeds from maturities of investments |
| 12,850 |
|
|
| 124,447 |
|
|
| 76,937 |
|
|
| 454,996 |
|
Proceeds from sales of investments |
| |
|
|
| |
|
|
| 186,262 |
|
|
| 48,786 |
|
Change in restricted cash |
| (783 | ) |
|
| (456 | ) |
|
| 10,336 |
|
|
| (2,618 | ) |
Payment of deferred consideration |
| (2,550 | ) |
|
| |
|
|
| (7,034 | ) |
|
| (185 | ) |
Net cash provided by (used in) investing activities |
| (23,881 | ) |
|
| 79,529 |
|
|
| 46,852 |
|
|
| 256,644 |
|
Financing activities |
|
|
|
|
|
|
| ||||||||
Proceeds from exercise of share options |
| 17 |
|
|
| 5 |
|
|
| 32 |
|
|
| 1,163 |
|
Payments of lease obligations |
| (11,052 | ) |
|
| (11,336 | ) |
|
| (49,142 | ) |
|
| (44,874 | ) |
Payment of issuance costs for debt |
| |
|
|
| |
|
|
| |
|
|
| (4,445 | ) |
Interest paid |
| (4,466 | ) |
|
| (2,282 | ) |
|
| (13,310 | ) |
|
| (6,498 | ) |
Repayment of exchangeable senior notes |
| |
|
|
| (540,197 | ) |
|
| (1,548,686 | ) |
|
| (1,803,244 | ) |
Proceeds from settlement of capped call transactions |
| |
|
|
| 67,012 |
|
|
| 135,497 |
|
|
| 203,093 |
|
Proceeds from term loan facility |
| |
|
|
| |
|
|
| 1,000,000 |
|
|
| |
|
Proceeds from other financing arrangements |
| 4,362 |
|
|
| |
|
|
| 13,877 |
|
|
| |
|
Net cash used in financing activities |
| (11,139 | ) |
|
| (486,798 | ) |
|
| (461,732 | ) |
|
| (1,654,805 | ) |
Effect of exchange rate changes on cash and cash equivalents |
| (6,571 | ) |
|
| (4 | ) |
|
| (9,194 | ) |
|
| 5,406 |
|
Net increase (decrease) in cash and cash equivalents |
| 188,806 |
|
|
| (222,906 | ) |
|
| 459,422 |
|
|
| (551,425 | ) |
Cash and cash equivalents at beginning of period |
| 1,194,803 |
|
|
| 1,151,450 |
|
|
| 919,227 |
|
|
| 1,479,969 |
|
Net decrease (increase) in cash and cash equivalents included in assets held for sale |
| 1,656 |
|
|
| (9,317 | ) |
|
| 6,616 |
|
|
| (9,317 | ) |
Cash and cash equivalents at end of period | $ | 1,385,265 |
|
| $ | 919,227 |
|
| $ | 1,385,265 |
|
| $ | 919,227 |
|
Contacts
Investor Relations Contact
Martin Lam
IR@atlassian.com
Media Contact
Marie-Claire Maple
press@atlassian.com
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