Atlassian (TEAM) Q1 2026 earnings summary

Executive summary

• Q1 FY26 revenue grew 21% year-over-year to $1.43 billion, with Cloud revenue up 26% to $998 million and RPO up 42% to $3.3 billion.

• Surpassed 3.5 million monthly active users of AI capabilities, up 50% quarter-over-quarter.

• Major restructuring and acquisitions completed, including The Browser Company and DX, to expand AI and product offerings.

• Announced end-of-life for Data Center deployment, accelerating cloud migration momentum and introducing Atlassian Ascend.

• Over 300,000 customers, including 53,017 with >$10,000 in Cloud ARR, now use the AI-enabled cloud platform.

Financial highlights

• Total revenue reached $1.43 billion, up 21% year-over-year; Cloud revenue grew 26% to $998 million.

• GAAP operating margin was (7)% due to $55.7 million in restructuring charges; non-GAAP operating margin was 23%.

• Net loss was $51.9 million (GAAP), improved from $123.8 million loss year-over-year; non-GAAP net income was $275.7 million, up from $199.7 million.

• Free cash flow was $114.6 million, with a margin of 8%.

• Cash and marketable securities totaled $2.8 billion at quarter end.

Outlook and guidance

• FY26 total revenue growth projected at 20.8% year-over-year; Cloud revenue growth at 22.5%.

• Q2 FY26 revenue expected between $1,535 million and $1,543 million.

• Full-year guidance reflects 18%-20.8% growth, with 3.2% attributed to data center end-of-life migrations.

• Organic revenue growth outlook lowered by 50 basis points due to revenue recognition timing and lower marketplace take rates.

• FY26 GAAP operating margin expected at (2.0)%, non-GAAP at 25.5%.