Enterprise software company Atlassian Corp. Plc struggled to brush off investor concerns relating to its profitability, despite posting fiscal first-quarter financial results that beat market expectations.

The company, which sells a range of collaboration, project management and productivity software for enterprises, reported income before certain costs such as stock compensation of $49.2 million, or 20 cents per share. Total revenue came in at $267.3 million for the quarter, up 37 percent from a year ago.

The results beat Wall Street’s estimates of earnings of 19 cents per share on revenue of $259.67 million.

Atlassian also did well on the customer acquisition front, netting 5,888 new clients during the first quarter. That brought its customer count to 131,684. The company also reported free cash flow of $74.2 million for the first quarter.

Shareholders weren’t happy, though. Atlassian’s stock fell almost 6 percent in after-hours trading. Marketwatch speculated that may be thanks to a surprise $244.7 million loss during the quarter, which the company said was “a result of marking to fair value the exchange feature on Atlassian’s exchangeable senior notes and the related capped calls.”

Atlassian’s earnings came in just hours after it announced a major update to its Jira project management tool with a focus on making it more accessible to nontechnical users. That marked the end of a busy first quarter for Atlassian, which also acquired OpsGenie Inc., a venture-backed startup specializing in cybersecurity incident response, and sold its Hipchat and Stride collaboration tools to Slack Technologies Inc.

“Alongside our other offerings, these two products [Jira and OpsGenie] support our efforts to deepen Atlassian’s focus on IT teams in fiscal 2019 and help realize our broader mission to unleash the potential of every team,” said co-Chief Executive Scott Farquhar.

The stock drop might disappoint Atlassian’s executives, but such ups and downs are to be expected, said Holger Mueller, principal analyst and vice president of Constellation Research Inc.

“Atlassian keeps building a suite of products that enables enterprises to create next generation applications, and CxOs will welcome the new incident management capabilities,” Mueller said. “As long as it is providing value, the long-term future remains promising.”

The company’s immediate prospects also look bright. In guidance for the second quarter, Atlassian said it expects an adjusted profit of 21 cents per share on revenue of $287 million to $289 million. Wall Street analysts said they were expecting a 20-cent profit.

Photo: Atlassian