Atlassian's share price continued its slide after Friday's quarterly results, dropping 9% in after-hours trading to extend a brutal 12-month decline of nearly 70%. CEO Mike Cannon-Brookes came out swinging, insisting the company is "building a f***ing great business" and that AI will boost rather than kill its software model.
The Sydney-based company is caught in broader market fears that generative AI from OpenAI and Anthropic will disrupt traditional enterprise software. Cannon-Brookes's counter-argument: enterprises are still signing big deals. Annual contracts worth over $1 million doubled year-over-year this quarter, he said, signaling that large organizations see Atlassian as a long-term bet.
The company is accelerating share buybacks, which Cannon-Brookes framed as confidence the stock is "significantly undervalued." That's a predictable move when your shares are down this much, but it does put capital where his mouth is.
Atlassian's AI play centers on Rovo, its agentic AI layer across Jira, Confluence, and Slack, backed by the Teamwork Graph knowledge network. The company's January AI Insights report made the case for "teammate agents" over individual productivity tools. Only 4% of companies see enterprise transformation from AI because they focus on individual gains instead of collaborative workflows, according to BCG data cited by Atlassian.
This mirrors broader skepticism about AI ROI. MIT research flags data silos as barriers, while Glean's report notes AI amplifies existing culture, meaning poor organizational structures backfire. Atlassian's State of Product 2026 report found teams save about two hours daily on routine tasks but struggle with high-value work like prioritization. That gap between time saved and strategic impact is what Cannon-Brookes needs to close.
The real question for enterprise buyers: is Atlassian's collaborative AI thesis correct, or are they rearranging deck chairs while foundation models reshape how work gets done? The market's current answer is visible in the share price. Cannon-Brookes has time to prove otherwise, but the clock is running.