Why Atlassian Corporation PLC (NASDAQ: TEAM) stock is going gangbusters today

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Atlassian Corporation PLC (NASDAQ: TEAM) stock rose over 10.5% on 24th January, 2020 (as of 10:35 am GMT-5; Source: Google finance) after the company posted better than expected results for the second quarter of FY 20 boosted by strong growth in subscription revenue. The subscription revenue grew to $228.6 million from $152.5 million a year before. The company has added that its customer count on a net basis grew by 5,003 in the second quarter, which resulted in a total customer count of 159,787. Atlassian has reported the net income of $41.8 million, compared to net income of $45.2 million in the year-ago period. The company has generated the cash flow from operations of $218.4 million and free cash flow of $202.0 million for the second quarter of fiscal 2020. Free cash flow margin for the second quarter of fiscal 2020 was 49%. At the end of the second quarter of fiscal 2020, Cash and cash equivalents, and short-term investments were of total $1.9 billion.

TEAM in the second quarter of FY 20 has reported the adjusted earnings per share of 49 cents, beating the analysts’ estimates for the adjusted earnings per share of 27 cents, according to the analysts surveyed by FactSet. The company had reported the adjusted revenue growth of 37 percent to $408.7 million in the second quarter of FY 20, beating the analysts’ estimates for revenue of $389 million. The company has posted the operating income of $41.8 million for the second quarter of fiscal 2020, compared with an operating loss of $3.2 million for the second quarter of fiscal 2019. Operating margin was 10% for the second quarter of fiscal 2020, compared tp (1%) for the second quarter of fiscal 2019.

Meanwhile, during the second quarter of fiscal 2020, the Atlassian Marketplace had crossed a new milestone, by achieving $1 billion in lifetime sales since its inception in 2012. Atlassian during the quarter had also launched Forge, which is its new cloud app development platform. Forge is expected to reduce the cost and complexity for developers to build cloud apps for their own teams and the broader Atlassian customer base.

Atlassian expects the third-quarter revenue to be in the range of $395 million and $399 million, with a profit expected to be in the region of 20 cents per share. Wall Street had earlier predicted the revenue to be of $397.1 million, with a profit to be of 22 cents per share.

 

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