Atlassian Corporation

Good afternoon and thank you for joining Atlassian's earnings conference call for the third quarter of fiscal year 2026. This conference call is being recorded and will be available for replay on the investor relations section of the Atlassian website following this call. I will now hand the call over to Martin Lamb, Atlassian's head of investor relations.

Welcome to Atlassian's third quarter fiscal year 2026 earnings call. Thank you for joining us today. On the call with me today, we have Atlassian CEO and co-founder Mike Cannon-Books and Chief Financial Officer James Chong. Earlier today, we published the shareholder letter and press release with our financial results and commentary for our third quarter of fiscal year 2026. The shareholder letter is available on the investor relations section of our website, where you will also find our other earnings-related materials, including the earnings press release and supplemental investor data sheet. As always, our shareholder letter contains management's insight and commentary for the quarter. So during the call today, we'll have brief opening remarks and then focus our time on Q&A. This call will include forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties, and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. You should not rely upon forward-looking statements as predictions of future events Forward-looking statements represent our management's beliefs and assumptions only as of the date such statements are made. We undertake no obligation to update or revise such statements should they change or cease to be current. Further information on these and other factors that could affect our business performance and financial results is included in filings we make with the Securities and Exchange Commission from time to time, including the section titled Risk Factors and our most recently filed annual and quarterly reports. During today's call, we will also discuss non-GAAP financial measures, These non-GAAP financial measures are in addition to and are not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. The reconciliation between GAAP and non-GAAP financial measures is available in our shareholder letter, earnings release, and investor data sheet on the investor relations section of our website. We'd like to allow as many of you to participate in Q&A as possible, so out of respect for others on the call, we'll take one question at a time. With that, I'll turn the call over to Mike for opening remarks.

Thank you all for joining us today. As you've already read in our shareholder letter, we delivered some incredible Q3 results. Total revenue grew 32% year-over-year to $1.8 billion. Cloud revenue surpassed $1.1 billion and accelerated to 29% growth year-over-year. And RPO grew again 37% year-over-year to $4 billion. These are largely thanks to our team's excellent execution and clear momentum across our key strategic priorities, enterprise, AI, and the system of work. This quarter, some of the world's largest enterprises, including Siemens Energy, Rimental, and Wayfair, deepened and broadened their commitments to Atlassian. In AI, we continue to add millions of monthly active users to Rovo, And our AI Rovo credit usage is growing more than 20% month over month. Customers using Rovo are also growing their ARR at roughly two times the rate of customers who are not using Rovo, contributing to our strong cloud outperformance and expansion in the quarter. And more and more enterprises are embracing our platform-wide vision, using Atlassian System of Work to see the full picture of their organization. This is because the teamwork graph connects knowledge, work, people, and code, giving our customers one of the richest enterprise context graphs in the world. Context is a clear differentiator for us. And we're seeing this as our competitive momentum builds. This is our largest ever quarter for competitive displacements from a major ITSM provider. We're taking share from rivals as customers move away from legacy systems and choose Atlassian for a more modern, AI-native and much better value service platform. As I've said before, I believe AI is one of the best things that has ever happened to Atlassian. In a world where humans will run teams of agents, context is the only anchor to avoid chaos. And we believe that companies who prioritize context will become truly AI-native. With Atlassian, our customers aren't just choosing software, they're choosing the kind of company that they want to become. This is a time of significant change in our industry, and we're moving forward with strong conviction and discipline. We're focused on executing, delivering customer value, and driving durable, profitable growth. With that, I'll pass the call to the operator for Q&A.