​Atlassian suffers $4.9m Q3 operating loss

In its second earnings report since going public, enterprise software firm Atlassian has posted an IFRS operating loss of $4.9 million for the third quarter of fiscal 2016.

Australian startup darling Atlassian has released its results for the third quarter of fiscal 2016, announcing an IFRS operating loss of $4.9 million.

IFRS net loss was $1.1 million for the three months ended March 31, compared with $0.6 million for the third quarter of fiscal 2015, resulting in a net loss per diluted share of $0.01.

The Nasdaq-listed company also reported total revenue of $117.9 million, a year-on-year increase of 40 percent.

Despite posting a loss, Atlassian co-CEO and co-founder Scott Farquhar remains positive, saying his company achieved a solid quarter of top-line and free cash flow growth, with cash and cash equivalents, and short-term investments at the end of the third quarter totalling $723.3 million.

"Our unique ability to solve the full set of collaboration needs for teams is driving momentum across our products," Farquhar said.

"Customers increasingly rely on Atlassian products to boost the productivity of their technical and non-technical teams by improving how those teams communicate, create and share information, and track work."

The company added 3,169 new customers during the quarter, and as of March 31, Atlassian held a total customer count on an active subscription or maintenance agreement basis of 57,431, a 26 percent increase from the same quarter last year.

For the three months ending December 2015, the company posted non-IFRS operating income of $20.3 million with revenue of $109.7 million, an increase of 45 percent year-on-year.

The company's second quarter net income was $19.1 million and net income per diluted share was $0.11, compared with $14.3 million for the second quarter of fiscal 2015.

"We achieved a strong first quarter as a public company, with a combination of continued growth and profitability," Farquhar said in February.

Friday's results are the second quarterly earnings report the company has posted since it undertook the biggest ever float from an Australian company in the United States last December.

Prior to its Nasdaq listing, Atlassian was valued at AU$5.6 billion, but the heavily oversubscribed IPO saw the tech firm reach a AU$6.01 billion valuation.

Within the first 24 hours of going public, Atlassian's stock soared 32 percent, debuting at $27.67 and peaking at $28.50 before closing at $27.78.

The company's closing share price put its market value at nearly AU$8 billion.

Atlassian's filing with the US Securities Exchange Commission in November revealed the company had maintained profitability for the last 10 years, citing between fiscal 2013 and 2015 the compound annual growth rate was 46.7 percent, resulting in $319.5 million of total revenue for fiscal 2015. Just over 50 percent of the company's revenue for FY15 was a result of maintenance charges.

The company's financial statement also showed that between FY14 and FY15 it nearly doubled its investment in research and development, and as a result total operating expenses increased from $155.6 million to $266.2 million during the two financial years. Operating income dipped to $0.4 million in FY15 from $21.5 million in FY14.

Looking forward, Atlassian told shareholders on Friday it expects to post a total revenue in the range of $123 million to $125 million for the fourth quarter, and approximately $452 million to $454 million for the full fiscal year.