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Atlassian anticipates $1.6bn total revenue for fiscal 2020 as subscriptions make it rain

Can you hear the cloudy cash registers ringing?

Atlassian, continued its march into megabucks territory with a 37 per cent year-on-year rise in revenues for the quarter as subscriptions led the way.

The company trousered $408.7m in revenues for the second quarter of fiscal 2020 (ended 31 December 2019), compared to $299m for the same period in the previous year. $228.7m of that was from subscriptions, approximately 50 per cent up on $152.5m.

It is all about the cloud at Atlassian these days and the company recently added free tiers to its lineup as a way of luring customers into the world of Jira and Confluence. Free options for other Atlassian products, such as Bitbucket or Trello, are also available.

The Atlassian Marketplace has also crested the $1bn mark for lifetime sales, although it has taken since 2012 to reach that point.

The company, however, only added 5,003 customers during the period, bringing the total to 164,790 on active subscriptions or paying for maintenance. To sustain revenue growth, it'll need to either squeeze more out of its existing users, tempt new ones into the fold, or both.

In a letter to shareholders (PDF), Atlassian attributed part of the bonzer bolus of bucks to "stronger than anticipated new and renewal activity from customers ahead of recent price changes". As such, the company is predicting a quiet third quarter for fiscal 2020, with revenues hovering between $395m and $399m.

Don't shed too many tears for the DevOps shack, however. The total revenue for fiscal 2020 is expected to be between $1.59bn and $1.6bn with a gross margin between 82.5 and 83 per cent on an IFRS (Internal Financial Reporting Standards) basis.

Speaking of tears, the 4,000 employees of Atlassian will be waving farewell to company president Jay Simons, who will be departing in July after 12 years at the outfit to pursue "new adventures".

Simons will leave with the business in rude health, although there are clouds over the horizon. Cash cows such as Jira face challenges from the likes of GitLab, which aims to deliver a DevOps platform as a single application, potentially rolling its tanks onto Atlassian's lawns.

"Atlassian," according to the outgoing Simons, "is just getting warmed up." ®

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