Shares in enterprise productivity software company Atlassian Corp. Plc. plunged in after-hours trading on weaker-than-expected guidance today despite the company beating market predictions in its quarterly earnings report.

For its fourth quarter ended June 30, Atlassian reported revenue of $430.5 million, up 29% from a year. It reported a net loss of $385.2 million, or $1.56 a share, though that was mostly because of a onetime charge of $382.7 million related to marking some financial notes to fair value. Analysts had been predicting a profit of 21 cents per share on revenue of $410.7 million.

“We drove strong results in fiscal year 2020, generating $1.6 billion in revenue, up 33% from the prior year,” Scott Farquhar, Atlassian’s co-founder and co-chief executive officer, said in a statement. “We now serve over 174,000 customers, including more than 150,000 using our cloud products and made significant progress in transforming Atlassian into a cloud-first global software leader.”

Although the quarterly figures were strong, guidance was lower than expected. For Atlassian’s first quarter ending Sept. 30, the company is predicting an adjusted profit of 26 to 27 cents per share on revenue of $430 million to $445 million. Analysts had forecast an adjusted profit of 29 cents per share on revenue of $439 million.

According to Investor’s Business Daily, the lower than expected guidance is in part because of Atlassian’s exposure to small businesses as well as monthly cloud contracts that could be canceled. Small businesses are currently suffering from the COVID-19 pandemic, with the U.S. having just reported its biggest-ever single-quarter plunge in gross domestic product in the second quarter.

Alongside its financials, Atlassian also announced the acquisition of Mindville AB, a Swedish Jira information technology service management and asset management solutions startup for an undisclosed price. The acquisition is intended to bolster Atlassian’s ITSM portfolio and work management offerings for nontechnical teams.

Mindville will continue to support existing customers while Atlassian will integrate the company’s offering into Jira Service Desk. Although the company isn’t well known, its list of customers is. Notable customers include Intel Co., Deutsche Lufthansa AG, Vodafone Group plc, Spotify Technology SA, Samsung Electronics Co. Ltd. and the National Aeronautics and Space Administration.

Atlassian shared fell 7% in after-hours trading.

Image: Atlassian