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TEAM, Atlassian

Software asset-light UnprofitableDistress / turnaround

The Atlassian Cloud Platform underpins our cloud app portfolio, allowing us to provide unified experiences, standardized data, and common enterprise infrastructure across all apps and teams.

Atlassian's team collaboration software enables organizations to connect all teams through a system of work that unlocks productivity at scale.

Our deeply interconnected portfolio of apps, AI agents, and Collections, each with discrete value propositions, delivers solutions for software teams, IT operations and support teams, leadership and business teams.

Latest annual: FY2025 10-K

TEAM · Atlassian

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$5.2B

+19.7% YoY · 26% 4-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $6.2B 5-yr avg $3.6B

Gross margin 84% 5-yr avg 83%

Operating margin −3.7% 5-yr avg −1.1%

ROIC −24%

Owner-earnings margin 19% 5-yr avg 29%

Free cash flow margin 19% 5-yr avg 29%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Unprofitable. No sustained operating profit across the record; an earnings multiple has nothing to rest on. What the record does show is revenue, the gross-margin trajectory, and the burn against the cash on hand. Distress / turnaround. Thin interest coverage, or operating cash burned against real debt, across the record. The balance sheet carries this situation; the debt schedule sets the clock.
What moves the needle: Operating margin has run around −2.5% through the cycle on a 83% gross margin, the operating line in the red even at its best — so the lever is whether the spending below the gross line can come down enough to clear a profit: revenue growth against the cost curve, and the cash runway until it does. The cash cycle has run negative through the cycle (a median of −36 days): the operation is paid before it pays, so working capital releases cash as the business grows rather than tying it up. Read this kind of business on retention and the cost of growth. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2021–2025

realized figures from each filing · older years to the left

2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
						Income statement
$2.1B	$2.8B	$3.5B	$4.4B	$5.2B	$6.2B	RevenueRevenue
84%	84%	82%	82%	83%	84%	Gross marginGross mgn
15%	16%	17%	14%	12%	12%	SG&A / revenueSG&A/rev
45%	46%	53%	50%	51%	52%	R&D / revenueR&D/rev
$141M	$70M	($345M)	($117M)	($130M)	($229M)	Operating incomeOp. inc.
6.8%	2.5%	−9.8%	−2.7%	−2.5%	−3.7%	Operating marginOp. mgn
($579M)	($520M)	($487M)	($301M)	($257M)	($217M)	Net incomeNet inc.
						Cash flow & returns
$790M	$821M	$868M	$1.4B	$1.5B	$1.2B	Operating cash flowOp. cash
$56M	$52M	$61M	$79M	$92M	$124M	DepreciationDeprec.
$972M	$764M	$346M	$589M	$262M	($221M)	Working capital & otherWC & other
$32M	$71M	$26M	$33M	$45M	$45M	CapexCapex
1.5%	2.5%	0.7%	0.8%	0.9%	0.7%	Capex / revenueCapex/rev
$758M	$769M	$842M	$1.4B	$1.4B	$1.2B	Owner earningsOwner earn.
36.3%	27.4%	23.8%	32.5%	27.1%	19.5%	Owner earnings marginOE mgn
$758M	$750M	$842M	$1.4B	$1.4B	$1.2B	Free cash flowFCF
36.3%	26.8%	23.8%	32.5%	27.1%	19.5%	Free cash flow marginFCF mgn
$92M	$19M	$6M	$848M	$14M	$1.2B	AcquisitionsAcquis.
$0	$0	$150M	$395M	$779M	—	BuybacksBuybacks
-185%	-159%	-74%	-29%	-19%	-25%	Return on equityROE
−185%	−159%	−74%	−29%	−19%	−25%	Retained to equityRetained/eq
						Balance sheet
$919M	$1.5B	$2.1B	$2.3B	$2.9B	$1.1B	Cash & investmentsCash+inv
—	$308M	$478M	$628M	$778M	$907M	ReceivablesReceiv.
—	$81M	$159M	$178M	$222M	$208M	Accounts payablePayables
—	$227M	$318M	$451M	$556M	$700M	Operating working capitalOper. WC
—	$1.9B	$2.7B	$3.1B	$3.9B	$2.3B	Current assetsCur. assets
—	$1.6B	$2.0B	$2.6B	$3.2B	$3.3B	Current liabilitiesCur. liab.
—	1.2×	1.3×	1.2×	1.2×	0.7×	Current ratioCurr. ratio
$716M	$723M	$727M	$1.3B	$1.3B	$2.3B	GoodwillGoodwill
—	$3.3B	$4.1B	$5.2B	$6.0B	$5.7B	Total assetsAssets
—	$999M	$1000M	$986M	$988M	$1000M	Total debtDebt
—	($459M)	($1.1B)	($1.4B)	($1.9B)	($137M)	Net debt / (cash)Net debt
1.5×	1.7×	-11.5×	-3.4×	-4.3×	-5.3×	Interest coverageInt. cov.
$313M	$327M	$655M	$1.0B	$1.3B	$879M	Shareholders’ equityEquity
16.3%	18.7%	26.8%	24.8%	26.1%	25.2%	Stock comp / revenueSBC/rev
						Per share
250M	253M	256M	259M	262M	263M	Shares out (diluted)Shares
$8.37	$11.06	$13.79	$16.82	$19.92	$23.57	Revenue / shareRev/sh
$-2.32	$-2.05	$-1.90	$-1.16	$-0.98	$-0.83	EPS (diluted)EPS
$3.04	$3.04	$3.29	$5.46	$5.41	$4.59	Owner earnings / shareOE/sh
$3.04	$2.96	$3.29	$5.46	$5.41	$4.59	Free cash flow / shareFCF/sh
$0.13	$0.28	$0.10	$0.13	$0.17	$0.17	Cap. spending / shareCapex/sh
$1.25	$1.29	$2.55	$3.99	$5.14	$3.35	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	4-yr	5-yr
Revenue / share	+24.2%/yr	+24.2%/yr (4-yr)
Owner earnings / share	+15.5%/yr	+15.5%/yr (4-yr)
Capital spending / share	+7.9%/yr	+7.9%/yr (4-yr)
Book value / share	+42.3%/yr	+42.3%/yr (4-yr)

The record, charted

FY2021–2025

Each measure over its full record; the current point and the worst year marked.

Share count

262Mpeak FY2025

Gross margin

83%low FY2024

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$1.4Bowner earningsvs.($257M)net incomelow FY2021

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetained

Each year's operating cash, by what management did with it: the mix, and how it drifts.

FY2021FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business turned a $257M loss into $1.4B of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	($257M)	($301M)	($487M)	($520M)	($579M)
Depreciation & amortizationnon-cash charge added back	+$92M	+$79M	+$61M	+$52M	+$56M
Stock-based compensationreal costnon-cash, but a real cost	+$1.4B	+$1.1B	+$948M	+$525M	+$341M
Working capital & othertiming of cash in and out, other non-cash items	+$262M	+$589M	+$346M	+$764M	+$972M
Cash from operations	$1.5B	$1.4B	$868M	$821M	$790M
Maintenance capital expenditurethe spending needed just to hold position and volume	−$45M	−$33M	−$26M	−$52M	−$32M
Owner earnings	$1.4B	$1.4B	$842M	$769M	$758M
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	—	—	—	−$19M	—
Free cash flow	$1.4B	$1.4B	$842M	$750M	$758M
Owner-earnings marginowner earnings ÷ revenue	27%	32%	24%	27%	36%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $1.4B), owner earnings is nearer $53M.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? -4.3×

Does not cover its interest

Operating income ($130M) ÷ interest expense $31M

What this means
A full year of operating profit didn't cover the interest bill. This is the zombie zone: the business depends on refinancing, asset sales, or forbearance to service its debt.
How heavy is the debt, net of cash? +$1.9B

Net cash

Cash $2.5B + ST investments $424M − debt $988M

What this means
Cash and short-term investments exceed every dollar of debt by $1.9B, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? -36d

Negative, funded by others

DSO 54 + DIO 0 − DPO 91 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. A negative cycle is a quiet moat: suppliers and customers fund the operation (Buffett's “float”), the company grows on other people's money. (Little or no inventory, a services / asset-light model, so the inventory leg is ~0.)

Is it a good business?

Return on invested capital —

Not meaningful here

Invested capital ($180M) = debt $988M + equity $1.3B − cash

Industry peers: median 7%

What this means
Invested capital is near zero or negative, usually years of buybacks pulling equity down. ROIC explodes or flips sign and stops meaning anything. Judge this one on Owner Earnings instead.
Owner-earnings margin 27%

High through the cycle

5-yr median margin, range 24%–36%; latest $1.4B = operating cash $1.5B − maintenance capex $45M

Industry peers: median 25%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 27% of revenue this year, a 27% median across 5 years. Treating stock comp as the real expense it is (less $1.4B of SBC) leaves $53M.
Are earnings backed by cash? $1.5B

Loss, but cash-generative

Net income ($257M) · cash from operations $1.5B

In the filing’s words And the filing leans heavily on adjusted, non-GAAP earnings — steering you off the GAAP figure just where the cash is not backing it. Read the reconciliation in the notes before taking the adjusted number.

What this means
The company reported a net loss, so a conversion ratio isn't meaningful. What matters then is whether operations still threw off cash, here, they did.

How is the cash used?

Where do the earnings go? 55%

Returns about half

Dividends + buybacks $779M ÷ Owner Earnings $1.4B

What this means
Of $1.4B Owner Earnings, $779M (55%) went back to shareholders, $0 dividends, $779M buybacks. But the buybacks barely exceed stock issued to employees ($1.4B SBC), net of dilution, little was truly returned. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 0.49×

Harvesting

Capex $45M ÷ depreciation $92M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 1 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $5.2B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Miss

Current ratio ≥ 2× · 1.22×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Near

Debt ≤ working capital · $988M vs $710M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (5-yr record) · 5 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-1.33/share (latest year $-0.98), the averaged base the calculator's gate runs on, and book value is $5.12/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2021–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 0 of 5

What this means
Lost money in 5 year(s), look at what happened there before trusting the average.
Operating margin 5% → −3% (2-yr avg ends)

In the filing’s words The filing attributes gains to higher prices, but the margin in the record has not followed — the claim outruns the result here.

What this means
Through the cycle the operating margin slipped — about 5% early to −3% lately, median −3% — competition or costs are biting in.
Owner earnings growth +17%/yr

What this means
Owner earnings grew about 17% a year over the record.
Worst year 2023 · −9.8% op. margin

What this means
Operations went underwater in 2023, understand why before trusting the good years.
Share count +1.2%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.
How management talks about it Owner’s terms

What this means
The record and the register agree: capital is compounding and the filing reasons in an owner’s terms — per-share value, return on capital, the long term — not a promoter’s.

Does AI threaten the moat?

Elevated contestability

The product is software or information, the very thing capable AI now produces more cheaply, so the moat is more contestable than the record alone implies.

In its own filing Named as a competitive risk

Its FY2025 10-K names artificial intelligence as a competitive threat.

“With the adoption of new technologies, including AI, the evolution of our apps, agents, and Collections, and new market entrants, we expect competition to intensify in the future.”

AI has collapsed the cost of building a capable substitute for the very thing this business sells. When a credible alternative can be assembled for a fraction of the incumbent's price, it is pricing power that erodes first, not revenue tomorrow. The live question is whether the moat survives that, not whether it held in the past. Whether that question is answerable at all is yours to decide, against your own circle of competence.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$2.3B

Cash & short-term investments$1.1B
Receivables$907M
Other current assets$290M

Current liabilities$3.3B

Accounts payable$208M
Other current liabilities$3.1B

Current ratio0.70×all current assets ÷ what's due · Graham looked for 2×

Quick ratio0.70×stricter: inventory excluded

Cash ratio0.34×strictest: cash alone against what's due

Working capital($989M)the cushion left after near-term bills

Revenue, latest quarter vs. a year ago+31.7%the freshest read on whether the business is still growing

Current ratio, recent quarters1.2× → 0.7×

Deeper floors

Tangible book value($1.9B)equity stripped of goodwill & intangibles

Net current asset value($2.4B)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$1.2B$254M of it operating leases

Deferred revenue$2.4Bcustomer cash collected before delivery; operating float

From the company's latest filing.

How the cash was used, 2021–2025

Over the record, the business generated $5.4B of operating cash; how management split it reads as a balanced allocator, splitting cash between the business, owners, and the balance sheet.

Reinvested$206M · 4%
Buybacks$1.3B · 25%
Retained (debt / cash)$3.9B · 72%

Returned to owners$1.3B
25% of the owner earnings the business produced over the span, $0 as dividends and $1.3B as buybacks.
Average price paid for buybacks$183.99
Across the years where the filing reports a share count, 7M shares were bought for $1.3B, about $183.99 each. Year to year the price paid ranged from $150.01 (2023) to $194.86 (2025), and 2025, near the top of that range, was also its heaviest buyback year ($779M).
Net change in share count5.2%
The diluted count rose from 250M to 263M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 5-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$1.5B26% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity97%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$979Mover 5 years buying other businesses, against $206M of capital spent building

None written down over the record; the goodwill is still carried at full cost. That is the deals holding their value on the books so far; whether they keep doing so is the test an owner watches, since the write-down, when it comes, is the admission the price was too high.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 5-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2023	Cannon-Brookes	$55k	$55k	$842M
2023	Farquhar	$55k	$55k	$842M
2024	Cannon-Brookes	$55k	$55k	$1.4B
2024	Farquhar	$56k	$56k	$1.4B
2025	Cannon-Brookes	$54k	$54k	$1.4B
2025	Farquhar	$13k	$13k	$1.4B

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2025 proxy: skin in the game, the first thing Munger reads.
Stock-based compensation$1.4B
The slice of the business handed to employees in shares this year, 26% of revenue. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Atlassian is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2021–2025.

1 of the 3 tests turned up something to look into; the other 2 came back clean.

Look hereDid the share count rise anyway?5.2%
Diluted shares grew 5.2% over 2021–2025, even as the company spent $1.3B on buybacks. The repurchases were a treadmill: stock issued to staff outran them, so owners' slice still shrank. Read the buyback line beside this one, not on its own.

And these came back clean

Is it less profitable than it was?
Are "one-time" charges a yearly habit?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition, Income taxes, Acquisitions, Stock compensation as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Software

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
SSNCSS&C Technologies	$6.3B	47%	21.8%	7%	25%
CDNSCadence Design Systems Inc.	$5.3B	99%	24.1%	28%	28%
TEAMAtlassian	$5.2B	83%	-2.5%	—	27%
TWLOTwilio Inc.	$5.1B	52%	-19.4%	-7%	-1%
GENGen Digital	$5.0B	82%	32.2%	11%	31%
CRWDCrowdStrike Holdings Inc.	$4.8B	74%	-9.8%	—	31%
SNOWSnowflake Inc.	$4.7B	64%	-49.7%	-20%	16%
PLTRPalantir Technologies Inc.	$4.5B	78%	-17.6%	7%	16%
Group median	—	76%	-6.2%	—	26%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Atlassian has delivered.

Today’s price $

Through the cycle, Atlassian earns about $1.4B on its 27.4% median owner-earnings margin. This year’s 27.1% margin runs in line with that. Normalize, below, values the price on that through-cycle figure rather than the latest year.

Base Normalize · through-cycle ($1.4B) Net of stock comp (−$1.6B)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25+17%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Owner earnings $1.2B on 263M shares outstanding (a weighted basic average, the only count this filer tags); net cash $137M. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh TEAM against another business →

The owners of TEAM: the meeting and the votes →

Cite: Owner Scorecard, "Atlassian (TEAM), the owner's record," https://ownerscorecard.com/c/TEAM, data as of 2026-07-09.

Manual order: ← TE its page in the Manual TECH →

Industry order: ← TDC the Software chapter TEM →