Atlassian (TEAM) risk factors, 2025 10-K

Risks Related to Our Business and Industry

1. 01Our historical rapid growth makes it difficult to evaluate our future prospects, and we may not be able to sustain our revenue growth rate or achieve profitability in the future
2. 02The continuing global economic and geopolitical volatility, and measures taken in response, could harm our business and results of operations
3. 03The markets in which we participate are intensely competitive, and if we do not compete effectively, our business, results of operations, and financial condition could be harmed
4. 04Our AI offerings and investments may not be successful, which could adversely affect our business or financial results
5. 05We may encounter challenges as we continue to transition our business to focus on Cloud offerings
6. 06Our business depends on our customers renewing their subscriptions and purchasing additional licenses or subscriptions from us, and any decline in our customer retention or expansion could harm our future results of operations
7. 07If we are not able to develop or package new apps, agents and enhancements to our existing offerings that achieve market acceptance and that keep pace with technological developments, our business and results of operations could be harmed
8. 08We invest significantly in research and development, and to the extent our research and development investments do not translate into new offerings or material enhancements to our current offerings, or if we do not use those investments efficiently, our business and results of operations would be harmed
9. 09If we fail to effectively manage our growth, our business and results of operations could be harmed
10. 10We may encounter challenges as we develop our sales force and sales strategy
11. 11Our business model for our low-touch customers is based in part on a high volume of transactions and organic expansion. If this model is not effective, our business and results of operations could be harmed
12. 12Any failure to offer high-quality product support could harm our relationships with our customers and our business, results of operations, and financial condition
13. 13If we are unable to develop and maintain successful relationships with our solution partners, our business, results of operations, and financial condition could be harmed
14. 14If we fail to integrate our apps, agents, and products with a variety of operating systems, software applications, platforms and hardware that are developed by others, our products may become less marketable, less competitive, or obsolete and our results of operations could be harmed
15. 15We derive a majority of our revenue from Jira, Confluence, and Jira Service Management
16. 16If we cannot continue to expand the use of our offerings beyond our initial focus on software developers, our ability to grow our business could be harmed
17. 17Our corporate values have contributed to our success, and if we cannot maintain these values as we grow, we could lose the innovative approach, creativity, and teamwork fostered by our values, and our business could be harmed
18. 18If we are not able to maintain and enhance our brand, our business, results of operations, and financial condition could be harmed
19. 19If the Atlassian Marketplace does not continue to be successful, our business and results of operations could be harmed
20. 20Acquisitions of, or investments in, other businesses, products, or technologies could disrupt our business, and we may be unable to integrate acquired businesses and technologies successfully or achieve the expected benefits of such acquisitions
21. 21from time to time enter into strategic relationships with other businesses to expand our offerings, which could involve preferred or exclusive licenses, additional channels of distribution, discount pricing, or investments in other companies

Risks Related to Information Technology, Intellectual Property, and Data Security and Privacy

1. 22If our security controls are compromised, leading to unauthorized or inappropriate access to customer data, our products could be perceived as insecure, and such perception may result in the loss of existing customers, hinder our ability to attract new ones, and expose us to significant liabilities
2. 23Interruptions or performance problems associated with our technology and infrastructure could harm our business and results of operations
3. 24Real or perceived errors, failures, vulnerabilities, or bugs in our offerings or in the apps on Atlassian Marketplace could harm our business and results of operations
4. 25Privacy concerns and laws as well as evolving regulation of cloud computing, AI products and services, cross-border data transfer restrictions and other domestic or foreign regulations may limit the use and adoption of our services and adversely affect our business and results of operation
5. 26We may be sued by third parties for alleged infringement or misappropriation of their intellectual property rights
6. 27Indemnity provisions in various agreements potentially expose us to substantial liability for intellectual property infringement and other losses
7. 28We use open source software in our products that may subject our products to general release or require us to re-engineer our products, which could harm our business
8. 29Any failure to protect our intellectual property rights could impair our ability to protect our proprietary technology and our brand

Risks Related to Financial Matters

1. 30Our quarterly results have fluctuated in the past and may fluctuate significantly in the future and may not fully reflect the underlying performance of our business
2. 31We recognize certain revenue streams over the term of our subscription contracts. Consequently, downturns in new sales may not be immediately reflected in our results of operations and may be difficult to discern
3. 32Seasonality may cause fluctuations in our revenue
4. 33We may require additional capital to support our operations or the growth of our business and we cannot be certain that we will be able to secure this capital on favorable terms, or at all
5. 34Our current and future indebtedness may limit our flexibility in obtaining additional financing and in pursuing other business opportunities or operating activities
6. 35We are subject to risks associated with our strategic investments, including partial or complete loss of invested capital. Significant changes in the value of this portfolio could negatively impact our financial results
7. 36Our global operations and structure subject us to potentially adverse tax consequences
8. 37Taxing authorities may successfully assert that we should have collected or in the future should collect sales and use, value-added or similar taxes, and we could be subject to liability with respect to past or future sales, which could harm our results of operations
9. 38If we are unable to maintain effective internal control over financial reporting in the future, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our Class A Common Stock could be negatively affected
10. 39We face exposure to foreign currency exchange rate fluctuations
11. 40We are exposed to credit risk and fluctuations in the market values of our investment portfolio
12. 41If we are deemed to be an investment company under the Investment Company Act of 1940, our results of operations could be harmed

Risks Related to Legal and Regulatory Matters

1. 42Our development and use of AI technologies may expose us to operational, legal, regulatory, reputational and other risks that may adversely affect our business
2. 43We and our customers are subject to increasing and changing laws and regulations that may expose us to liability and increase our costs
3. 44Our sales to U.S. government entities and contractors are subject to additional challenges and risks, including those related to FedRAMP compliance
4. 45Adverse litigation results could have a material adverse impact on our business
5. 46Regulators, investors’ and others’ expectations and scrutiny of our performance relating to environmental, social and governance efforts may impose additional costs and expose us to new risks

Risks Related to Ownership of Our Class A Common Stock

1. 47The dual class structure of our common stock has the effect of concentrating voting control with certain stockholders, in particular, our Co-Founders and their affiliates, which will limit our other stockholders’ ability to influence the outcome of important transactions, including a change in control
2. 48The market price of our Class A Common Stock is volatile, has fluctuated significantly in the past, and could continue to fluctuate significantly regardless of our operating performance resulting in substantial losses for the holders of our Class A Common Stock
3. 49Substantial future sales of our common stock could cause the market price of our Class A Common Stock to decline
4. 50We cannot guarantee that our Share Repurchase Program will be fully consummated or that it will enhance long-term stockholder value. Repurchases of shares of our Class A Common Stock could also increase the volatility of the trading price of our Class A Common Stock and could diminish our cash reserves
5. 51We do not expect to declare dividends in the foreseeable future
6. 52Anti-takeover provisions contained in our amended and restated certificate of incorporation, amended and restated bylaws, our Senior Notes, as well as provisions of Delaware law, could impair a takeover attempt
7. 53These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management
8. 54Our amended and restated certificate of incorporation and amended and restated bylaws provide that we will indemnify our directors and officers, in each case to the fullest extent permitted by Delaware law
9. 55While we have procured directors’ and officers’ liability insurance policies, such insurance policies may not be available to us in the future at a reasonable rate, may not cover all potential claims for indemnification, and may not be adequate to indemnify us for all liability that may be imposed
10. 56Our global operations subject us to risks that can harm our business, results of operations, and financial condition
11. 57We depend on our executive officers and other key employees and the loss of one or more of these employees or the inability to attract and retain highly skilled employees could harm our business
12. 58Catastrophic events may disrupt our business
13. 59Climate change may have a long-term impact on our business