Atlassian Q2 EPS Tops by $0.10 as Cloud Revenue Jumps 26%
Atlassian reported Q2 fiscal 2026 earnings of $1.22 per share, beating estimates by $0.10, while revenue rose 23% year-over-year to $1.59 billion. Subscription revenues climbed 24.3% to $1.51 billion, driven by 26% growth in Cloud, as the company guided Q3 revenues of $1.689–1.697 billion.
1. Q2 Earnings and Revenue Beat
Atlassian delivered Q2 FY26 non-GAAP EPS of $1.22, exceeding consensus by $0.10, and reported $1.59 billion in revenue, up 23% year-over-year. This marks the fourth consecutive quarter of upside surprise, with a 20.7% average earnings surprise over the past year.
2. Segment Performance and Cloud Strength
Subscription revenue jumped 24.3% to $1.51 billion, led by Cloud revenue growth of 26% to $1.07 billion. Data Center revenues climbed 20% to $435.6 million and Marketplace receipts advanced 8% to $83.7 million, underpinning an 88% non-GAAP gross margin, up 300 basis points year-over-year.
3. Balance Sheet and Cash Flow
At quarter end Atlassian held $1.6 billion in cash and marketable securities, generated $177.8 million in operating cash flow and $168.5 million in free cash flow, reflecting strong operating leverage from enterprise adoption.
4. Q3 and Full-Year Outlook
For Q3 FY26 Atlassian expects revenue of $1.689–1.697 billion (21% year-over-year growth), non-GAAP gross margin of 88% and operating margin near 27.5%. Full-year guidance calls for approximately 22% revenue growth and a 25.5% non-GAAP operating margin.