Atlassian TEAM, a prominent provider of team collaboration and productivity software, is scheduled to report second-quarter fiscal 2025 results after market close on Jan. 30.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Atlassian projects fiscal second-quarter revenues between $1.233 billion and $1.241 billion. The Zacks Consensus Estimate for revenues is pegged at $1.24 billion, suggesting growth of 16.6% from the year-ago reported figure.

For fiscal second-quarter earnings, the consensus mark has remained unchanged at 73 cents per share over the past 60 days. In the year-ago quarter, the company had reported non-GAAP earnings of 73 cents. 

TEAM surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 24.4%.

Atlassian Corporation PLC Price and EPS Surprise

Atlassian Corporation PLC price-eps-surprise | Atlassian Corporation PLC Quote

Factors to Consider for TEAM

The robust adoption of Atlassian’s cloud-based offerings, along with the accelerating trend of digitalization among organizations and the increasing embrace of hybrid work models, is likely to have propelled the company’s fiscal second-quarter performance. The surge in demand for TEAM’s cloud solutions from both new and existing customers shifting away from on-premises products is likely to have served as a positive catalyst for growth in the to-be-reported quarter.

Our estimate for revenues from Cloud deployment is pegged at $811.6 million, indicating a 24.2% increase from the year-ago quarter. Revenues from Data Center deployment are anticipated to grow 26.2% year over year to $346.6 million.

The strong demand for essential products like Jira Software and Confluence Cloud, combined with the growing adoption of advanced solutions, such as Jira Product Discovery Premium, Compass Premium and Guard Premium, is expected to have driven TEAM’s success in the second quarter. These cutting-edge offerings deliver enterprise-grade capabilities and are expected to have boosted the latest cloud solutions to new heights.

Atlassian's recent emphasis on integrating AI features into its collaboration software is likely to have driven its top line in the second quarter. Additionally, TEAM's multi-year partnership with Amazon Web Services aims to accelerate cloud transformation and provide advanced AI and security capabilities to enterprise customers, which is noteworthy.

However, TEAM’s performance in the fiscal second quarter is expected to have been affected by a soft IT spending environment. Still high interest rates and protracted inflationary conditions are likely to have hurt consumer spending. Furthermore, businesses are postponing significant IT investments due to a struggling global economy, which is further complicated by macroeconomic and geopolitical challenges.

What Our Proven Model Says for TEAM’s Q2 Earnings

Our proven model does not conclusively predict an earnings beat for Atlassian this time. According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

TEAM has an Earnings ESP of 0.00% and carries a Zacks Rank #4 (Sell) at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

BILL Holdings, Inc. BILL has an Earnings ESP of +29.71% and flaunts a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

It is set to report second-quarter fiscal 2025 results on Feb. 6. The Zacks Consensus Estimate for BILL’s second-quarter fiscal 2025 earnings is pegged at 48 cents per share, up by a penny over the past 60 days, indicating a fall of 23.8% from the year-ago quarter’s reported figure. BILL shares have gained 16.2% over the past year.

ServiceNow NOW has an Earnings ESP of +0.91% and carries a Zacks Rank #2 at present. 

It is set to report fourth-quarter results on Jan. 29. The Zacks Consensus Estimate for NOW’s fourth-quarter 2024 earnings per share is pegged at $3.58, up by a couple of pennies over the past 60 days. NOW shares have risen 44.9% over the past year.

DoorDash DASH has an Earnings ESP of +35.67% and carries a Zacks Rank #2 at present. 

It is set to report fourth-quarter 2024 results on Feb. 11. The Zacks Consensus Estimate for DASH’s fourth-quarter earnings is pegged at 35 cents per share, up by a penny over the past 60 days, indicating a rise of 189.7% from the year-ago quarter’s reported figure. DASH shares have surged 65.2% over the past year.

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