Is TEAM a good stock to buy? We came across a bullish thesis on Atlassian Corporation on Compounding Your Wealth’s Substack by Sergey. In this article, we will summarize the bulls’ thesis on TEAM. Atlassian Corporation’s share was trading at $78.01 as of March 10th. TEAM’s forward P/E was 13.97 according to Yahoo Finance.
Computer with charts
Atlassian Corporation provides collaboration software that enables organizations to connect all teams through a system of work that unlocks productivity at scale worldwide. TEAM delivered a strong fourth quarter, reinforcing its position as a leading provider of collaboration and workflow software while demonstrating continued momentum in its cloud transition and AI-driven product ecosystem. The company reported revenue of $1.59 billion, growing 23.4% year-over-year and exceeding expectations, supported primarily by subscription revenue of $1.51 billion, which increased 24.3%.
Cloud revenue reached a major milestone with its first $1 billion quarter, rising 26% year-over-year as enterprises increasingly standardize operations on Atlassian’s cloud platform through multi-year agreements. Remaining Performance Obligations climbed to $3.8 billion, up 44% year-over-year, signaling stronger long-term customer commitments and expanding contract durations. Growth was further supported by strong customer expansion within the installed base, with net revenue retention exceeding 120% and enterprise adoption accelerating across products such as Jira, Confluence, and Jira Service Management, which now serves more than 65,000 customers including over half of the Fortune 500.
Atlassian’s AI initiatives are also gaining traction, with its Rovo platform surpassing five million monthly active users and powering millions of AI-driven workflows, while the Teamwork Collection bundle has already exceeded one million seats in less than nine months, driving higher product adoption and increased average revenue per user.
Profitability improved as gross margin expanded to 87.5% and operating margin reached 27.1%, reflecting operating leverage despite higher AI infrastructure costs. Although free cash flow margin declined due to elevated investments and stock-based compensation, Atlassian’s strong ARR growth, accelerating enterprise adoption, expanding cloud platform, and increasing AI integration position the company for sustained 20%+ growth and improving profitability over the medium term, supporting a constructive long-term outlook for the business.
Previously, we covered a bullish thesis on Atlassian Corporation (TEAM) by Deep Value Returns in May 2025, which highlighted the company’s strong free cash flow generation, scalable enterprise software model, and management’s target of achieving a 20% CAGR through fiscal 2027. TEAM’s stock price has depreciated by approximately 62.47% since our coverage due to concerns regarding AI disruptions. Sergey shares a similar view but emphasizes Atlassian’s accelerating cloud growth, AI-driven ecosystem, and rising enterprise adoption.
Atlassian Corporation is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 57 hedge fund portfolios held TEAM at the end of the fourth quarter which was 60 in the previous quarter. While we acknowledge the risk and potential of TEAM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than TEAM and that has 10,000% upside potential, check out our report about this cheapest AI stock.
READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy NOW
Disclosure: None.
