New York, Feb 6, 2026, 07:36 EST — Premarket
- TEAM shares dipped in early trading following Atlassian’s quarterly results and guidance.
- Investors are balancing concerns over AI-driven disruption with ongoing cloud migration advancements.
- Following the results, several brokers lowered their price targets.
Shares of Atlassian Corporation slipped 6.3% to $98.41 in premarket trading on Friday.
Atlassian’s stock decline is grabbing attention as it highlights a heated debate in software: can AI tools undermine major workflow platforms like Jira, even while companies keep investing heavily in cloud subscriptions? The Nasdaq-listed shares have tumbled over 66% in the past year, according to The Australian. 1
Traders face a straightforward question: will Atlassian sustain cloud growth around the mid-20% mark and show that its new AI features actually generate revenue, not just buzz?
Atlassian reported fiscal Q2 revenue of $1.586 billion, a 23% jump from last year, with cloud revenue climbing 26% to $1.067 billion. The company posted a GAAP net loss of $42.6 million but delivered adjusted earnings of $1.22 per share. CEO Mike Cannon-Brookes highlighted this as their “first-ever $1 billion Cloud revenue quarter.” 2
A filing revealed Atlassian provided its earnings release and shareholder letter via an 8-K on Feb. 5, but did not formally “file” them. This subtle difference curbs some legal risks unless the company includes the documents in other filings. 3
Atlassian reported its cloud net revenue retention rate (NRR) topped “120%+” for the third quarter in a row. NRR tracks revenue growth from existing customers over a year, factoring in both churn and expansion. The company also revealed that its Teamwork Collection, which it markets as a key AI revenue driver, has surpassed 1 million seats and 1,000 customers. 4
Barclays’ Ryan MacWilliams lowered his price target on Atlassian to $165 from $215 but maintained an Overweight rating. He cited ongoing cloud migration efforts and cross-selling opportunities, even as he trimmed sector valuations. MacWilliams emphasized that he doesn’t expect AI-native tools to fully erode Jira and Confluence’s strong positions, writing, “We don’t believe” their foothold will be “completely diminished.” 5
The list of potential pitfalls keeps growing. Investing.com noted Atlassian’s Q3 revenue forecast between $1.689 billion and $1.697 billion, while cloud revenue growth is expected to slow to roughly 23%. Bank of America’s Koji Ikeda warned that “the AI disruption bear thesis” still looms over software. Wolfe Research’s Alex Zukin also lowered his price target, the report added. 6
Investors will hone in on cloud growth and retention in the next session, watching closely for any clues that Rovo and the bundled “collections” might boost paid seat growth without heavy reliance on pricing.
The immediate trigger comes at the U.S. open, 9:30 a.m. ET, as traders dig into whether the post-earnings selloff holds—or if the stock finds footing amid new guidance and target revisions.
