UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

	
 	
FORM 6-K
 
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
under the Securities Exchange Act of 1934
 
August 4, 2016
 
Commission File Number 001-37651

Atlassian Corporation Plc
(Exact name of Registrant as specified in its charter)
 
Not Applicable
(Translation of Registrant’s name into English)
 
Exchange House
Primrose Street
London EC2A 2EG
c/o Herbert Smith Freehills LLP
415.701.1110
(Address, Including Zip Code, and Telephone Number, Including
Area Code, of Registrant’s Principal Executive Offices)

	

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F:      Form 20-F  x Form 40-F  ¨
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ¨

Results of Operations and Financial Condition.

On August 4, 2016, Atlassian Corporation Plc issued a press release announcing its results for the fiscal quarter and fiscal year ended June 30, 2016. A copy of the press release is attached as Exhibit 99.1 to this current report on Form 6-K and is incorporated by reference herein.

The information in this current report on Form 6-K and the exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.

Financial Statements and Exhibits
 
Exhibits
		
99.1	Press release dated August 4, 2016.	

Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	
				
Dated:	August 4, 2016	 	Atlassian Corporation Plc	
 	 	 	 	
 	 	 	/S/    MURRAY DEMO        	
 	 	 	Murray Demo
Chief Financial Officer
(Principal Financial Officer)	

Exhibit Index

	
		
Exhibit
Number	Exhibit Title	
 	 	
99.1	Press Release dated August 4, 2016	

Atlassian Announces Fourth Quarter and Fiscal Year 2016 Results

Quarterly revenue of $127.6 million, up 39% year-over-year
Quarterly IFRS operating loss of $11.4 million and non-IFRS operating income of $15.6 million
Quarterly free cash flow of $17.6 million

SAN FRANCISCO (August 4 , 2016 ) — Atlassian Corporation Plc (NASDAQ: TEAM ), a leading provider of team collaboration and productivity software, today announced financial results for its fourth quarter and fiscal year ended June 30, 2016.

“Fiscal 2016 was a landmark year for Atlassian," said Scott Farquhar, Atlassian’s co-CEO and co-founder. "Over the past year, we grew revenue to more than $450 million, added over 12,300 net-new customers, generated over $95 million of free cash flow and completed a successful IPO. We are still early in our growth trajectory and expect fiscal 2017 to be another great year for the company. We are also excited about the addition of StatusPage, our first acquisition as a public company. StatusPage is a standout company in its category and is a natural extension of the software development and IT operations processes where Atlassian is a leader.”    

Fourth Quarter Fiscal Year 2016 Financial Highlights:
On an IFRS basis, Atlassian reported: 

•	Revenue: Total revenue was $127.6 million for the fourth quarter of fiscal 2016, up 39% from $91.8 million for the fourth quarter of fiscal 2015.	

•	Operating Loss: Operating loss was $11.4 million for the fourth quarter of fiscal 2016, compared with $3.3 million for the fourth quarter of fiscal 2015.	

•	Net Loss and Net Loss Per Diluted Share: Net loss was $4.7 million for the fourth quarter of fiscal 2016, compared with $1.2 million for the fourth quarter of fiscal 2015. Net loss per diluted share was $0.02 for the fourth quarter of fiscal 2016, compared with net loss of $0.01 per diluted share for the fourth quarter of fiscal year 2015. 	

•	Balance Sheet: Cash and cash equivalents and short-term investments at the end of the fourth quarter of fiscal 2016 totaled $743.1 million.	
On a non-IFRS basis, Atlassian reported: 

•	Operating Income: Operating income was $15.6 million for the fourth quarter of fiscal 2016, compared with $11.3 million for the fourth quarter of fiscal 2015.	

•	Net Income and Net Income Per Diluted Share: Net income was $16.9 million for the fourth quarter of fiscal 2016, compared with $10.7 million for the fourth quarter of fiscal 2015. Net income per diluted share was $0.07 for the fourth quarter of fiscal 2016, compared with $0.07 per diluted share for the fourth quarter of fiscal 2015. 	

•	Free Cash Flow: Cash flow from operations for the fourth quarter of fiscal 2016 was $35.0 million while capital expenditures totaled $17.4 million, leading to free cash flow of $17.6 million, an increase of 150% year-over-year.  	

Fiscal Year 2016 Financial Highlights:
On an IFRS basis, Atlassian reported: 

•	Revenue:  Total revenue was $457.1 million for fiscal year 2016, up 43% from $319.5 million for fiscal year 2015.	

•	Operating Income/Loss:  Operating loss was $5.9 million for fiscal year 2016, compared with operating income of $1.7 million for fiscal year 2015.	

1

		
•	Net Income and Net Income Per Diluted Share:  Net income was $4.4 million for fiscal year 2016, compared with $6.8 million for fiscal year 2015. Net income per diluted share was $0.02 for fiscal year 2016, compared with $0.04 per diluted share for fiscal year 2015. 	
On a non-IFRS basis, Atlassian reported:

•	Operating Income:  Operating income was $77.1 million for fiscal year 2016, compared with $49.7 million for fiscal year 2015.	

•	Net Income and Net Income Per Diluted Share:  Net income was $71.3 million for fiscal year 2016, compared with $45.5 million for fiscal year 2015. Net income per diluted share was $0.35 for fiscal year 2016, compared with $0.28 per diluted share for fiscal year 2015. 	

•	Free Cash Flow:  Cash flow from operations for fiscal year 2016 was $129.5 million while capital expenditures totaled $34.2 million, leading to free cash flow of $95.3 million, an increase of 45% year-over-year.	

A reconciliation of IFRS to non-IFRS financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below, under the heading “About Non-IFRS Financial Measures.”

Recent Business Highlights:
		
•	Customer growth:  Atlassian ended the fourth quarter of fiscal 2016 with a total customer count on an active subscription or maintenance agreement basis of 60,950, a 25% increase over June 30, 2015. Atlassian added 3,519 net new customers during the quarter. 	

•	StatusPage acquisition:  In July, Atlassian announced the acquisition of StatusPage, a fast-growing leader in the status and incident communication space. StatusPage lets customers communicate the status of their services including incidents, performance data, and scheduled maintenance. End users can subscribe to real-time SMS and email updates, keeping them informed while lowering support costs for providers. StatusPage will continue to provide its standalone service offering in the near-term. Atlassian plans to accelerate StatusPage’s offering with future integrations across Atlassian’s collaboration portfolio.	

•	New cloud products and Atlassian Marketplace growth:  In May, Atlassian announced several initiatives that will continue to drive growth in the cloud. These included the beta launch of Bitbucket Pipelines, a continuous delivery service that allows software developers to build, test and deploy code from a single tool without switching, as well as the launch of native mobile apps for JIRA Software and Confluence. The Company also announced that the Atlassian Marketplace, which provides add-ons for its core products, reached more than $150 million of cumulative sales since its inception four years ago.   
	
Financial Targets:
Atlassian is providing its financial targets for the first quarter and full fiscal year 2017. The company’s financial targets are as follows:
		
•	First Quarter Fiscal Year 2017 : 	

•	Total revenue is expected to be in the range of $132 million to $134 million . 	

•	Gross margin is expected to be approximately 81% on an IFRS basis and approximately 84% on a non-IFRS basis.	

•	Operating margin is expected to be (10%) on an IFRS basis and 14% on a non-IFRS basis.	

•	Weighted average share count is expected to be in the range of 232 million to 234 million shares on a fully diluted basis.	

•	Net loss per diluted share is expected to be approximately ($0.04) on an IFRS basis, and net income per diluted share is expected to be approximately $0.07 on a non-IFRS basis.	

•	Fiscal Year 2017: 	
		
•	Total revenue is expected to be in the range of $592 million to $602 million. 	

•	Gross margin is expected to be approximately 81% on an IFRS basis and approximately 84% on a non-IFRS basis.	

•	Operating margin is expected to be approximately (10%) on an IFRS basis and approximately 15% on a non-IFRS basis.	

2

		
•	Weighted average share count is expected to be in the range of 234 million to 236 million shares on a fully diluted basis.	

•	Net loss per diluted share is expected to be in the range of approximately ($0.18) to ($0.16) on an IFRS basis, and net income per diluted share is expected to be in the range of approximately $0.32 to $0.34 on a non-IFRS basis.	

•	Free cash flow is expected to be in the range of $145 million to $155 million.	

With respect to Atlassian’s expectations under “Financial Targets” above, a reconciliation of IFRS to non-IFRS gross margin, operating margin, net income per diluted share, and free cash flow have been provided in the financial statement tables included in this press release.

Webcast and Conference Call Details:

•	When: August 4, 2016 at 2:00 P.M. Pacific Time (5:00 P.M. Eastern Time).	

•	Webcast:  A live webcast of the call can be accessed from the Investor Relations section of Atlassian’s website at: http://investors.atlassian.com. Following the call, a replay will be available on the same website.	

•	Dial in:  To access the call via telephone in North America, please dial 1-888-346-0688. For international callers, please dial 1-412-902-4250. Participants should request the “Atlassian call” after dialing in. 	

•	Audio replay: An audio replay of the call will be available via telephone for seven days, beginning two hours after the call. To listen to the replay in North America, please dial 1-877-344-7529 (access code 10087956). International callers, please dial 1-412-317-0088 (access code 10087956).	
Atlassian has used, and intends to continue to use, its Investor Relations website (https://investors.atlassian.com), as a means of disclosing material non-public information and for complying with its disclosure obligations.

About Atlassian
Atlassian unleashes the potential in every team. Our collaboration software helps teams organize, discuss and complete shared work. Teams at more than 60,000 large and small organizations - including Citigroup, eBay, Coca-Cola, Visa, BMW and NASA - use Atlassian's project tracking, content creation and sharing, real-time communication and service management products to work better together and deliver quality results on time. Learn about products including JIRA Software, Confluence, HipChat, Bitbucket and JIRA Service Desk at http://atlassian.com.

Investor Relations Contact
Ian Lee
IR@atlassian.com
Media Contact
Heather Staples
press@atlassian.com
Forward-Looking Statements
This press release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. Forward-looking statements include all statements that are not historical facts and, in some cases, can be identified by terms such as “may,” “will,” “should,” “might,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements contained in this press release include, but are not limited to, statements about our products, including our investments in products, technology and other key strategic areas, benefits related to our recent acquisition, and our financial targets such as revenue, share count and IFRS and non-IFRS financial measures including gross margin, operating margin, net income per diluted share and free cash flow.
Atlassian undertakes no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.

3

The achievement or success of the matters covered by such forward-looking statements involves known and unknown risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, Atlassian’s 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.
Further information on these and other factors that could affect Atlassian’s financial results is included in filings it makes with the Securities and Exchange Commission from time to time, including the section titled “Risk Factors” in the company’s Form F-1 previously filed with the SEC and Form 6-K report filed on May 12, 2016. These documents are available on the SEC Filings section of the Investor Relations section of Atlassian’s website at: http://investors.atlassian.com.

About Non-IFRS Financial Measures
Our reported results and financial targets include certain non-IFRS financial measures, including non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share, and free cash flow. Management believes that the use of non-IFRS financial measures provides consistency and comparability with our past financial performance, facilitates period-to-period comparisons of results of operations, and also facilitates comparisons with peer companies, many of which use similar non-IFRS or non-GAAP financial measures to supplement their IFRS or GAAP results. Non-IFRS results are presented for supplemental informational purposes only to aid in understanding our operating results. The non-IFRS results should not be considered a substitute for financial information presented in accordance with IFRS, and may be different from non-IFRS or non-GAAP measures used by other companies.
Our non-IFRS financial measures reflect adjustments based on the items below:
Non-IFRS gross profit. Excludes expenses related to share-based compensation and amortization of acquired intangible assets.
Non-IFRS operating income. Excludes expenses related to share-based compensation and amortization of acquired intangible assets.
Non-IFRS net income and non-IFRS net income per diluted share. Excludes expenses related to share-based compensation, amortization of acquired intangible assets and related income tax effects on these items.
Free cash flow. Free cash flow is defined as net cash provided by operating activities less capital expenditures, which consist of purchases of property and equipment and acquired intangible assets.
We exclude expenses related to share-based compensation, amortization of acquired intangible assets and income tax effect on these items from certain of our non-IFRS financial measures as we believe this helps investors understand our operational performance. In addition, share-based compensation expense can be difficult to predict and varies from period to period and company to company due to differing valuation methodologies, subjective assumptions and the variety of equity instruments, as well as changes in stock price. Management believes that providing non-IFRS financial measures that exclude share-based compensation expense, amortization of acquired intangible assets and the tax effects of those items allow for more meaningful comparisons between our operating results from period to period.
We include the effect of our outstanding share options and restricted share units (“RSUs”) in weighted-average shares used in computing non-IFRS net income per diluted share. IFRS excludes the impact of the full weighting of these outstanding equity awards until the effectiveness of our initial public offering (“IPO”). We have presented the full weighting impact of these additional shares from previously granted share options and RSUs, as if they were outstanding from the date of grant, in order to provide investors with insight into the full impact of all potentially dilutive awards outstanding and to provide comparability.
Management considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that can be used for strategic opportunities, including investing in our business, making strategic acquisitions and strengthening our statement of financial position.
Management uses non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share and free cash flow:
		
•	as measures of operating performance, because these financial measures do not include the impact of items not directly resulting from our core operations;	
		
•	for planning purposes, including the preparation of our annual operating budget;	
		
•	to allocate resources to enhance the financial performance of our business;	

4

		
•	to evaluate the effectiveness of our business strategies; and	
		
•	in communications with our board of directors concerning our financial performance.	
The tables in this press release titled “Reconciliation of IFRS to Non-IFRS Results” and “Reconciliation of IFRS to Non-IFRS Financial Targets” provide reconciliations of non-IFRS financial measures to the most recent directly comparable financial measures calculated and presented in accordance with IFRS.
We understand that although non-IFRS gross profit, non-IFRS operating income, non-IFRS net income, non-IFRS net income per diluted share and free cash flow are frequently used by investors and securities analysts in their evaluation of companies, these measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results of operations as reported under IFRS.

5

Atlassian Corporation Plc
Consolidated Statements of Operations
(U.S. $ and shares in thousands, except per share data)
(unaudited)

	
																
 	Three Months Ended June 30,	 	Fiscal Year Ended June 30,	
 	2016	 	2015	 	2016	 	2015	
Revenues	 		 	 		 	 		 	 		
Subscription	$	43,590		 	$	26,023		 	$	146,659		 	$	85,891		
Maintenance	58,808		 	45,894		 	218,848		 	160,373		
Perpetual license	17,911		 	15,312		 	65,487		 	57,373		
Other	7,279		 	4,581		 	26,064		 	15,884		
Total revenues	127,588		 	91,810		 	457,058		 	319,521		
Cost of revenues (1) (2)	21,126		 	15,264		 	75,783		 	52,932		
Gross profit	106,462		 	76,546		 	381,275		 	266,589		
Operating expenses	 		 	 		 	 	 	 	
Research and development (1)	60,830		 	43,175		 	208,306		 	140,853		
Marketing and sales (1) (2)	30,980		 	19,231		 	93,391		 	67,989		
General and administrative (1)	26,042		 	17,482		 	85,458		 	56,033		
Total operating expenses	117,852		 	79,888		 	387,155		 	264,875		
Operating income (loss)	(11,390	)	 	(3,342	)	 	(5,880	)	 	1,714		
Other non-operating income (expense), net	(342	)	 	779		 	(1,072	)	 	(2,615	)	
Finance income	1,244		 	50		 	2,116		 	226		
Finance costs	(9	)	 	(10	)	 	(71	)	 	(74	)	
Loss before income tax benefit	(10,497	)	 	(2,523	)	 	(4,907	)	 	(749	)	
Income tax benefit	5,795		 	1,352		 	9,280		 	7,524		
Net income (loss)	$	(4,702	)	 	$	(1,171	)	 	$	4,373		 	$	6,775		
Net income (loss) per share attributable to ordinary shareholders:	 		 	 		 	 	 	 	
Basic	$	(0.02	)	 	$	(0.01	)	 	$	0.02		 	$	0.04		
Diluted	$	(0.02	)	 	$	(0.01	)	 	$	0.02		 	$	0.04		
Weighted-average shares outstanding used to compute net income (loss) per share attributable to ordinary shareholders:	 		 	 		 	 	 	 	
Basic	214,505		 	144,008		 	182,773		 	144,008		
Diluted	214,505		 	144,008		 	193,481		 	145,500		

	
 	
(1) Amounts include share-based payment expense, as follows:

																
 	Three Months Ended June 30,	 	Fiscal Year Ended June 30,	
 	2016	 	2015	 	2016	 	2015	
Cost of revenues	$	1,606		 	$	887		 	$	5,371		 	$	2,862		
Research and development	12,542		 	6,444		 	35,735		 	22,842		
Marketing and sales	3,385		 	1,969		 	11,945		 	6,670		
General and administrative	7,553		 	3,620		 	22,429		 	9,160		

(2) Amounts include amortization of acquired intangible assets, as follows:

																
 	Three Months Ended June 30,	 	Fiscal Year Ended June 30,	
 	2016	 	2015	 	2016	 	2015	
Cost of revenues	$	1,909		 	$	1,737		 	$	7,405		 	$	6,417		
Marketing and sales	21		 	16		 	86		 	40		

6

Atlassian Corporation Plc
Consolidated Statements of Financial Position
(U.S. $ in thousands)
(unaudited)

	
								
 	June 30, 2016	 	June 30, 2015	
Assets	 	 	 	
Current assets:	 	 	 	
Cash and cash equivalents	$	259,709		 	$	187,094		
Short-term investments	483,405		 	30,251		
Trade receivables	15,233		 	11,747		
Current tax receivables	6,013		 	939		
Prepaid expenses and other current assets	14,178		 	8,600		
Total current assets	778,538		 	238,631		
Non-current assets:	 	 	 	
Property and equipment, net	58,762		 	41,948		
Deferred tax assets	127,411		 	81,519		
Goodwill	7,138		 	7,152		
Intangible assets, net	13,577		 	21,099		
Other non-current assets	5,547		 	6,812		
Total non-current assets	212,435		 	158,530		
Total assets	$	990,973		 	$	397,161		
Liabilities	 	 	 	
Current liabilities:	 	 	 	
Trade and other payables	$	57,886		 	$	52,636		
Current tax liabilities	286		 	973		
Provisions	4,716		 	3,314		
Deferred revenue	173,612		 	131,231		
Total current liabilities	236,500		 	188,154		
Non-current liabilities:	 	 	 	
Deferred tax liabilities	6,639		 	4,919		
Provisions	2,170		 	1,873		
Deferred revenue	7,456		 	5,334		
Other non-current liabilities	6,545		 	6,827		
Total non-current liabilities	22,810		 	18,953		
Total liabilities	$	259,310		 	$	207,107		
Equity	 	 	 	
Share capital	$	21,620		 	$	18,461		
Share premium	441,734		 	5,744		
Other capital reserves	244,335		 	146,794		
Other components of equity	4,699		 	4,153		
Retained earnings	19,275		 	14,902		
Total equity	$	731,663		 	$	190,054		
Total liabilities and equity	$	990,973		 	$	397,161		

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Atlassian Corporation Plc
Consolidated Statements of Cash Flows
(U.S. $ in thousands)
(unaudited)

	
																
 	Three Months Ended June 30,	 	Fiscal Year Ended June 30,	
 	2016	 	2015	 	2016	 	2015	
Operating activities	 	 	 	 	 		 	 		
Loss before income tax	$	(10,497	)	 	$	(2,523	)	 	$	(4,907	)	 	$	(749	)	
Adjustments to reconcile loss before income tax to net cash provided by operating activities:	 	 	 	 	 		 	 		
Depreciation and amortization	6,342		 	4,559		 	21,926		 	15,511		
Net (gain) loss on disposal of property and equipment	(33	)	 	19		 	165		 	71		
Net unrealized foreign currency loss (gain)	160		 	(856	)	 	152		 	1,473		
Share-based payment expense	25,086		 	12,920		 	75,480		 	41,534		
Change in fair value of contingent consideration	—		 	—		 	—		 	(155	)	
Interest income	(1,244	)	 	(49	)	 	(2,116	)	 	(225	)	
Changes in assets and liabilities:	 	 	 	 	 	 	 	
Trade receivables	(1,101	)	 	(3,125	)	 	(3,487	)	 	(7,932	)	
Prepaid expenses and other assets	(2,454	)	 	(4,462	)	 	(4,203	)	 	(9,846	)	
Trade and other payables, provisions and other non-current liabilities	5,647		 	3,363		 	11,622		 	16,067		
Deferred revenue	14,979		 	13,903		 	44,503		 	47,381		
Interest received	1,381		 	13		 	2,839		 	156		
Income tax paid, net of refunds	(3,271	)	 	(2,985	)	 	(12,432	)	 	(5,065	)	
Net cash provided by operating activities	34,995		 	20,777		 	129,542		 	98,221		
Investing activities	 	 	 	 	 		 	 		
Business combinations, net of cash acquired	—		 	(7,280	)	 	—		 	(10,615	)	
Purchases of property and equipment	(17,394	)	 	(13,730	)	 	(34,213	)	 	(31,776	)	
Purchases of intangible assets	—		 	—		 	—		 	(900	)	
Purchases of investments	(133,639	)	 	(15,289	)	 	(569,067	)	 	(50,033	)	
Proceeds from maturities of investments	17,470		 	30,281		 	65,294		 	64,758		
Proceeds from sales of investments	43,140		 	—		 	49,501		 	—		
Payment of deferred consideration	—		 	—		 	(1,025	)	 	—		
Net cash used in investing activities	(90,423	)	 	(6,018	)	 	(489,510	)	 	(28,566	)	
Financing activities	 	 	 	 	 		 	 		
Proceeds from issuance of ordinary shares upon initial public offering, net of offering costs	—		 	—		 	431,447		 	—		
Proceeds from exercise of share options, including early exercised options	2,466		 	1,113		 	6,732		 	2,338		
Employee payroll taxes paid related to net share settlement of equity awards	—		 	—		 	(5,395	)	 	—		
Net cash provided by financing activities	2,466		 	1,113		 	432,784		 	2,338		
Effect of exchange rate changes on cash and cash equivalents	(223	)	 	50		 	(201	)	 	(1,665	)	
Net increase (decrease) in cash and cash equivalents	(53,185	)	 	15,922		 	72,615		 	70,328		
Cash and cash equivalents at beginning of period	312,894		 	171,172		 	187,094		 	116,766		
Cash and cash equivalents at end of period	$	259,709		 	$	187,094		 	$	259,709		 	$	187,094		

8

Atlassian Corporation Plc
Reconciliation of IFRS to Non-IFRS Results
(U.S. $ and shares in thousands, except per share data)
(unaudited)

																
 	Three Months Ended June 30,	 	Fiscal Year Ended June 30,	
 	2016	 	2015	 	2016	 	2015	
Gross profit:	 		 	 		 	 		 	 		
IFRS gross profit	$	106,462		 	$	76,546		 	$	381,275		 	$	266,589		
Plus: Share-based payment expense	1,606		 	887		 	5,371		 	2,862		
Plus: Amortization of acquired intangible assets	1,909		 	1,737		 	7,405		 	6,417		
Non-IFRS gross profit	$	109,977		 	$	79,170		 	$	394,051		 	$	275,868		
Operating income:	 		 	 		 	 		 	 		
IFRS operating income (loss)	$	(11,390	)	 	$	(3,342	)	 	$	(5,880	)	 	$	1,714		
Plus: Share-based payment expense	25,086		 	12,920		 	75,480		 	41,534		
Plus: Amortization of acquired intangible assets	1,930		 	1,753		 	7,491		 	6,457		
Non-IFRS operating income	$	15,626		 	$	11,331		 	$	77,091		 	$	49,705		
Net income:	 		 	 		 	 		 	 		
IFRS net income (loss)	$	(4,702	)	 	$	(1,171	)	 	$	4,373		 	$	6,775		
Plus: Share-based payment expense	25,086		 	12,920		 	75,480		 	41,534		
Plus: Amortization of acquired intangible assets	1,930		 	1,753		 	7,491		 	6,457		
Less: Income tax effects and adjustments	(5,437	)	 	(2,771	)	 	(16,018	)	 	(9,244	)	
Non-IFRS net income	$	16,877		 	$	10,731		 	$	71,326		 	$	45,522		
Net income per share:	 		 	 		 	 		 	 		
IFRS net income (loss) per share - basic	$	(0.02	)	 	$	(0.01	)	 	$	0.02		 	$	0.04		
Plus: Share-based payment expense	0.12		 	0.09		 	0.42		 	0.29		
Plus: Amortization of acquired intangible assets	0.01		 	0.01		 	0.04		 	0.05		
Less: Income tax effects and adjustments	(0.03	)	 	(0.02	)	 	(0.09	)	 	(0.06	)	
Non-IFRS net income per share - basic	$	0.08		 	$	0.07		 	$	0.39		 	$	0.32		
 	 	 	 	 	 	 	 	
IFRS net income (loss) per share - diluted	$	(0.02	)	 	$	(0.01	)	 	$	0.02		 	$	0.04		
Plus: Share-based payment expense	0.11		 	0.08		 	0.37		 	0.26		
Plus: Amortization of acquired intangible assets	0.01		 	0.01		 	0.04		 	0.04		
Less: Income tax effects and adjustments	(0.03	)	 	(0.01	)	 	(0.08	)	 	(0.06	)	
Non-IFRS net income per share - diluted	$	0.07		 	$	0.07		 	$	0.35		 	$	0.28		
Weighted-average diluted shares outstanding:	 	 	 	 	 	 	 	
Weighted-average shares used in computing diluted IFRS net income (loss) per share	214,505		 	144,008		 	193,481		 	145,500		
Dilution from share options and RSUs (1)	17,417		 	1,496		 	—		 	—		
Dilution from share options and RSUs granted in periods prior to IPO (2)	—		 	17,802		 	8,205		 	17,573		
Weighted-average shares used in computing diluted non-IFRS net income per share	231,922		 	163,306		 	201,686		 	163,073		
Free cash flow:	 		 	 		 	 		 	 		
IFRS net cash provided by operating activities	$	34,995		 	$	20,777		 	$	129,542		 	$	98,221		
Less: Capital expenditures	(17,394	)	 	(13,730	)	 	(34,213	)	 	(32,676	)	
Free cash flow	$	17,601		 	$	7,047		 	$	95,329		 	$	65,545		
(1) The effects of these dilutive securities were not included in the IFRS calculation of diluted net loss per share for the three months ended June 30, 2016 and 2015 because the effect would have been anti-dilutive.
(2) Gives effect to share options and RSUs in periods prior to our IPO for comparability.

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Atlassian Corporation Plc
Reconciliation of IFRS to Non-IFRS Financial Targets
(U.S. $)

	
						
 	Three Months Ending
September 30, 2016	 	Fiscal Year Ending
June 30, 2017	
Revenue	$132 million to $134 million		 	$592 million to $602 million		
 	 	 	 	
IFRS gross margin	81%		 	81%		
Share-based payment expense	1		 	2		
Amortization of acquired intangible assets	2		 	1		
Non-IFRS gross margin	84%		 	84%		
 	 	 	 	
IFRS operating margin	(10%)		 	(10%)		
Share-based payment expense	23		 	24		
Amortization of acquired intangible assets	1		 	1		
Non-IFRS operating margin	14%		 	15%		
 	 	 	 	
IFRS net loss per share - diluted	($0.04)		 	($0.18) to ($0.16)		
Share-based payment expense	0.13		 	0.60		
Amortization of acquired intangible assets	0.01		 	0.04		
   Income tax effects and adjustments	(0.03	)	 	(0.14	)	
Non-IFRS net income per share - diluted	$0.07		 	$0.32 to $0.34		
Weighted-averages shares used in computing diluted non-IFRS net income per share	232 million to 234 million		 	234 million to 236 million		
 	 	 	 	
IFRS net cash provided by operations	 	 	$160 million to $170 million		
Less: Capital expenditures	 	 	(15 million)		
Free cash flow	 	 	$145 million to $155 million		

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