Why Atlassian Stock Plunged Today
Shares of enterprise-software company Atlassian (NASDAQ: TEAM) plunged on Friday morning after it reported financial results for the second quarter of its fiscal 2023. The stock started the day down about 13%. But it's slowly clawing its way back up, only down 7% as of 10:45 a.m. ET.
In Q2, Atlassian generated revenue of nearly $873 million, up almost 27% year over year. That's a significant slowdown from its 31% growth in the previous quarter. And it's also much slower than its 34% growth in fiscal 2022. The market doesn't like slowing growth for growth stocks like Atlassian.
Atlassian was able to add more than 4,000 net new customers during Q2, which is encouraging. However, the company's software is frequently used by tech companies. In general, these companies have slowed hiring or even laid off workers, affecting Atlassian because subscriptions are per seat. And Atlassian is seeing fewer conversions from its free tier to its subscription tier, reflective of belt-tightening in the industry.
Source Fool.com
