Canaccord Genuity has reduced its 12-month price target on Atlassian Corporation (NASDAQ:TEAM) to $185.00, down from $230.00, while retaining a Buy rating on the shares. Atlassian is trading at $98.41, hovering close to its 52-week low of $97.93, after a 69.15% decline over the past year.
The research note from Canaccord highlighted several operational strengths that underpinned its view even as the firm trimmed its valuation. Remaining Performance Obligation (RPO) growth accelerated for the third consecutive quarter, rising 44% in FQ2 - a sign the analyst interpreted as customers moving to longer-term commitments on the platform. Canaccord also pointed to an 83.51% gross profit margin, as reflected in InvestingPro data.
Cloud metrics were another focal point. Canaccord noted Atlassians cloud net revenue retention exceeds 120% and has been increasing for three straight quarters, which the firm attributed to customers expanding user counts, adopting additional applications and upgrading to premium tiers.
On enterprise traction, the note stated Atlassian signed a record number of deals with annual contract values above $1 million in the quarter, a figure that nearly doubled year-over-year. That increased count of large deals was cited as evidence of continued momentum within enterprise accounts.
Canaccord also called out adoption for Atlassians AI initiatives - specifically Rovo and Teamwork Collection - as running ahead of expectations, indicating the companys AI investments are translating into customer engagement.
Those operating highlights arrived alongside fiscal Q2 2026 results that materially beat consensus. Atlassian reported earnings per share of $1.22, versus a forecast of $0.73, and revenue of $1.59 billion, above the anticipated $1.21 billion. Despite the upside to both EPS and revenue, Atlassians shares fell in after-hours trading amid broader market volatility.
Canaccords action - lowering the price target but keeping a Buy rating - and the mixed market response underline a divergence between near-term market sentiment and the companys operating and financial performance. The research note did not coincide with any analyst upgrades or downgrades linked to the earnings release.
Key takeaways:
- Analyst reduces valuation target to $185 but maintains a Buy recommendation.
- Strong underlying metrics: accelerating RPO, >120% cloud net retention, 83.51% gross margin, and rising large-deal activity.
- Fiscal Q2 2026 results topped expectations on both EPS and revenue, yet shares declined in after-hours trading amid market volatility.
This article presents the facts and figures reported in the research note and the companys fiscal release without adding projections or additional market commentary.