TEAM Stock: Is Atlassian a SaaSpocalypse Winner?

Reports of the death of software-as-a-service (SaaS) have been greatly exaggerated.

Eight months after the release of agentic workflow tools for Claude Cowork wiped billions of dollars from the market caps of prominent software firms, the sector’s biggest names are rebounding. They are riding a rally fuelled by bullish earnings prints, underlining their role in the deployment and monetisation of agentic artificial intelligence (AI).

For much of the year, Atlassian [TEAM] appeared to be one of agentic AI’s biggest victims. TEAM stock plummeted to lows not seen since 2018 as investors feared the company might lose pricing power as agents replaced human workers. But, with a steady stream of releases and positive earnings reports, the company has set about dismantling that narrative. 

A rally following Q4 results in early August and several analyst upgrades have since turned bears into bulls. Let’s take a look at the fundamentals that have some labelling Atlassian a SaaSpocalypse “winner”, and how it has turned agentic AI from a stack killer into a monetisable asset. 

AI panic to agentic hope

In a classic case of investor fears versus financial reality, Atlassian continued to report solid earnings throughout 2026, even as its market cap shrank. A positive Q3 and a software rally in May indicated better days ahead as prominent figures in the SaaS sector assured investors that the organisational layer provided by enterprise software firms would prove essential to the deployment of AI agents. Speaking at the Jefferies Software, Internet and AI Conference in May, ServiceNow [NOW] Chief Product Officer and COO Amit Zavery underlined the leverage that brand recognition and existing systems would give SaaS bigwigs in the deployment of AI solutions. He argued that customers “don’t want to go to a third-party system for only AI-related stuff… [they] want to go to the same place where [they] can have full license visibility, all usage visibility, all cost visibility.”

Atlassian’s Q4 earnings, released in early August, demonstrated this point. Non-GAAP EPS of $1.87 and revenue of $1.77bn – representing 27.3% growth year-on-year – came in well above Wall Street expectations, and cloud revenue increased 31% y/y as data centre migrations continued. Meanwhile, remaining performance obligation (RPO) grew 44% to $4.82bn, suggesting that the shift to agents is helping, not harming, Atlassian’s core business. 

Management guided FY 2027 cloud growth of 25.5%, with total revenue growth of 13%. It also outlined an annual recurring revenue (ARR) target for the first time, at 18% subscription growth, and a GAAP operating margin target of 4.5%, compared to -3% in FY 2025. Q1 2027 revenue is expected to fall within the $1.705bn-1.715bn range, which would be down 3.17% sequentially at the midpoint of guidance. 

In terms of product releases, Atlassian has kept doing what it does best – organising complex workflows with intuitive enterprise software. Its Teamwork Graph, released at the 2026 Team conference in May, maps both human and agentic workflows across Atlassian and over 100 third-party apps. Given that the expense of AI use has been a major headwind in deployment, a key feature is Teamwork Graph’s token efficiency, with the company claiming it delivers 44% more accurate results while using 48% fewer tokens than ungrounded queries. Rovo, its agentic tool, is used by over 80% of Fortune 500 companies, with Rovo-assisted actions growing 50% sequentially in Q4. 

TEAM makes a comeback 

Atlassian debuted on the Nasdaq in December 2015 at $21 per share, climbing steadily for the next half-decade. TEAM shares skyrocketed during the Covid-19 pandemic alongside other key work-from-home technology providers, reaching an all-time high of $483.13 on 29 October 2021. While it dipped below the $200 mark by May 2022, it remained above $140 for much of the next four years.

Then disaster struck. The SaaSpocalypse saw TEAM stock drop 65.46% from 1 January 2026 to a a nearly eight-year low of $56.01 on 10 April. Recovery came just as quickly, with a bullish Q4 print on 6 August sending shares up more than 35% in a single session. As of 9 September, the stock was down 2.53% in the past 12 months but up a whopping 217% from its April 2026 lows. 

Victims no more: TEAM vs MNDY vs NOW

Atlassian was not the only victim of the SaaSpocalypse, nor has it been the only stock to recover. ServiceNow also demonstrated its ability to monetise AI workflows with strong Q2 earnings in July, achieving AI annual contract value (ACV) surpassing $1bn, on track to beat its $1.5bn target by year-end. Subscription revenue grew 23% y/y to $3.88bn for the quarter, with management raising its 2026 subscription target to $15.760bn-15.780bn. In the wake of the breach of Hugging Face by a rogue OpenAI agent, CEO Bill McDermott touted the firm’s AI “kill switch”, arguing that broader AI adoption will increase demand for enterprise software such as ServiceNow’s.

Monday.com [MNDY], by contrast, has yet to dig itself out of its SaaSpocalypse hole, with shares still down over 45% in the year to date. Q2 earnings reported on 10 August beat top- and bottom-line estimates, with non-GAAP earnings of $1.48 and revenue of $364.6m, while annual recurring revenue (ARR) from AI products doubled quarter-on quarter, representing 17% of net new ARR. Q3 targets, however, fell short of Wall Street expectations, and a decline in new ARR pointed to a potentially risky slowdown in business. 

Here is how the fundamentals of the three stocks compare as of 9 September:

Source: Yahoo Finance

The investment case for TEAM stock

Much of the coverage of Atlassian since its Q4 earnings has been bullish, with a number of prominent upgrades. Post-earnings, Bank of America upgraded its rating to ‘buy’ from ‘neutral’, and raised its price target from $105 to $175. Oppenheimer maintained its ‘outperform’ rating but nearly doubled its target from $110 to $200. Guggenheim raised its price target from $115 to $165, and T.D. Cowen raised its target from $105 to $145. 

Towards the end of the month, RBC Capital Markets initiated coverage of TEAM stock with an ‘outperform’ rating and a $215 price target, arguing that the 18% ARR target is likely conservative “as Collections and Rovo/AI consumption momentum continue to build, seat expansion outperforms, and Cloud migration continues to be additive with expansions post-migration”.

Then, on 1 September, Citi analysts declared Atlassian an AI “winner”, arguing that the AI-driven strength on display in Q4 earnings rendered its discount versus SaaS peers unwarranted. “In our Al sentiment scoring framework, TEAM shakes out favourably on domain expertise (enterprise knowledge via Teamwork Graph), Al-driven acceleration and pricing scaling with Al usage (as Al capabilities drive Collections adoption and seat expansion),” the investment firm noted.

Management has been just as bullish as the analysts. Co-founder and CEO Mike Cannon-Brookes has pledged to buy shares worth $250m, underlining his faith in the company’s trajectory. 

That said, TEAM is not without its risks. The company has recorded pre-tax losses every year since listing in 2015, so margins remain a key metric for tracking the company’s progress. Additionally, the recent rally may represent TEAM returning to its fair value after a SaaS sector bear market, and limited upside could remain. Lastly, the continuing improvement of AI models and the competing products of other SaaS peers targeting expansion in the agentic age could eat into Atlassian’s prospects for future growth. 

Conclusion

Strong Q4 earnings have demonstrated Atlassian’s ability to integrate, organise and monetise agentic AI, turning a potential competitor into a key asset. Bullish coverage and company outlook suggest the SaaSpocalypse may prove to be no more than a blip in TEAM’s longer-term rally. However, the company will have to prove it can continue to benefit from AI deployment through improving margins in the near to medium term.