UPDATED 22:48 EDT / APRIL 27 2017

APPS

Atlassian tops earnings estimates but shares stay flat

Australian enterprise collaboration software maker Atlassian Corp. Plc. shrugged off last weekend’s hack of its HipChat communications platform, posting strong fiscal third-quarter earnings and updating future guidance that helped bump up its share price a notch.

Atlassian posted revenue of $159.9 million for the period, up 36 percent from a year ago to surpass Wall Street’s expectations of $156.64 million. The company’s net loss for the quarter was $17.5 million, compared with $1.1 million a year ago. Excluding onetime charges and other items such as stock compensation, the company reported a profit of eight cents per share, which was two cents higher than Wall Street estimates.

Investors response to the news was lukewarm at best, with Atlassian’s share price rising less than 1 percent, to $31.54, in after-hours trading.

The real highlight, though, was Atlassian’s continued customer growth. The company, which sells enterprise software including its JIRA Service Desk offering, team chat tool HipChat and workflow platform Confluence, said it added 16,194 new customers during the quarter. That compares with the 4,700 customers it added in the previous quarter, though the figure also includes 12,789 customers acquired after completing its $425 million acquisition of task management software firm Trello Inc.

“We again drove strong execution across our cloud, server and data center products, and our innovative model continues to combine consistent revenue growth with significant free cash flow generation,” Atlassian co-founder and Chief Executive Scott Farquhar said in a statement.

Atlassian has been busy this quarter merging Trello’s products with its own offerings since completing that acquisition. In March, the company announced Trello had been integrated with cloud-based versions of its JIRA Software, Confluence and Bitbucket. Also in March, the Atlassian Marketplace passed a new milestone, hitting $250 million in lifetime sales since its inception in 2012.

The company’s messaging platform Hipchat suffered a major hack over the weekend, losing a significant amount of data, including user’s names, email addresses and passwords. However, HipChat Chief Security Officer Ganesh Krishnan said in a blog post that fewer than 0.5 percent of users were affected, adding that even with the breach, the company’s encryption methods mean that passwords are “extraordinarily difficult” to crack.

The impact of this incident on the company’s finances won’t be known until it reports its fourth-quarter earnings in three month’s time, but Atlassian officials remained upbeat, posting improved financial targets for the period.

For its fiscal 2017 fourth quarter, Atlassian is shooting for revenue of $170 million to $172 million and a profit of 8 cents per share. For the full fiscal year 2017, the company is expecting revenue of $616 million to $618 million, up slightly from its earlier projection of $611 million to $615 million.

Image: Atlassian/Facebook

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