---
title: "Atlassian's Data Center revenue to fall 16% as Cloud grows 31%"
summary: "Atlassian's results and filings of 5 November, and its own end-of-life pages: why 24% growth is guided to about 13.75%, and the dates self-managed customers face."
url: https://www.thetechbag.com/blog/atlassian-data-center-revenue-to-fall-cloud-31
format: Analysis
desk: "SaaS & business software"
region: Global
published: 2026-11-06
facts_checked: 2026-11-06
author: TechBag (The TechBag Journal)
tags: ["Atlassian","Data Center","Data Center end of life","Atlassian Ascend","Atlassian Cloud","Jira","Confluence","Jira Service Management","self-managed software","cloud migration","term licence","revenue recognition","ASC 606","Subscription ARR","guidance","SaaS pricing","data residency","GST"]
cover: https://www.thetechbag.com/blog/covers/atlassian-data-center-revenue-to-fall-cloud-31.png
---

# Atlassian's Data Center revenue to fall 16% as Cloud grows 31%

*Atlassian's results and filings of 5 November, and its own end-of-life pages: why 24% growth is guided to about 13.75%, and the dates self-managed customers face.*

Analysis · SaaS & business software · By TechBag · Published 2026-11-06 · Facts checked 2026-11-06 · Canonical: https://www.thetechbag.com/blog/atlassian-data-center-revenue-to-fall-cloud-31

The short version

1. Atlassian’s revenue grew 24% to US$1,772m in the quarter to 30 September, with Cloud up 31%. Data Center, the version customers run on their own servers, grew 5% to US$390.7m, and Atlassian expects it to shrink about 14% this quarter and about 16% over the year to June 2027.[1]
2. The fall is mostly accounting and timing. After Atlassian announced on 8 September 2025 that Data Center would reach end of life, more of each Data Center contract was booked upfront, and customers pulled purchases into the last fiscal year. This year laps that bump, which is why a company growing 24% guides to about 13.75% for the year, a target it raised on 5 November.[2][4]
3. For customers the dates are fixed: no new Data Center customers since 30 March 2026, no new licences or expansions for existing ones after 30 March 2028, and read-only products after 28 March 2029. Bitbucket and Bamboo are exempt; list prices rose 15% in February.[7][8]

Atlassian sells Jira, Confluence and Jira Service Management two ways: as Cloud, which it hosts, and as Data Center, a “self-managed, enterprise-grade deployment option that allows customers to deploy and host Atlassian products on their own infrastructure”.[6] It is now closing the second one. Its shares fell after the results of 5 November, and the coverage we read put the fall down to a cautious outlook. This piece reads the company’s own filings instead: how Data Center revenue is booked, why it jumped and now falls, what Atlassian actually changed in its targets, and what the wind-down means for an organisation still running Data Center.

## Cloud grew 31%; Data Center peaked in the quarter new sales ended

Cloud revenue was US$1,302m in the quarter, up 31% from US$998m. Data Center revenue was US$390.7m against US$372.6m a year earlier, up 5%. Marketplace and other revenue, mostly third-party apps and premier support, was US$79m, up 27%.[1] Atlassian put Data Center’s growth down to customers renewing (“retention”), and said Subscription ARR, up 22.5% to US$6,812m, was held back by “the expected contraction in Data Center as customers expand less ahead of their migration to the Cloud”.[2]

The longer run shows what this quarter is being compared with. Data Center revenue went from US$336m in the September 2024 quarter to US$561m in the March 2026 quarter, up 44% that quarter, then back to US$391m. In the year to June 2026 it was US$1,830.9m, up 25%, while Cloud brought in US$4,410.6m, up 28%.[6][10]

**Figure: Cloud rose every quarter; Data Center spiked to US$561m in the quarter Atlassian stopped selling it to new customers**

*Revenue by deployment, US$ million, quarters to September 2024 through September 2026 (Atlassian's fiscal year ends 30 June)*

|  | Cloud | Data Center |
| --- | --- | --- |
| Q1 FY25 | 792 | 336 |
| Q2 FY25 | 847 | 362 |
| Q3 FY25 | 880 | 389 |
| Q4 FY25 | 928 | 381 |
| Q1 FY26 | 998 | 373 |
| Q2 FY26 | 1,067 | 436 |
| Q3 FY26 | 1,132 | 561 |
| Q4 FY26 | 1,213 | 462 |
| Q1 FY27 | 1,302 | 391 |

Source: Atlassian quarterly results, Form 8-K Exhibit 99.1, Q1 FY25 to Q1 FY27, each quarter from its own release · as of 6 November 2026 · Rounded to the nearest US$ million; Marketplace and other revenue not shown

Data Center is not small. It was 28% of revenue in the last fiscal year and 22% in this quarter, on our arithmetic from the reported figures, and Atlassian’s Marketplace takes a larger cut on third-party Data Center apps than on Cloud ones.[2][6]

## How a self-managed licence turns into upfront revenue

A Data Center sale is an “on-premises term license”: software licensed for a set period, with support and maintenance bundled in. Atlassian recognises the licence part of the price upfront, when the term begins, and the support part evenly over the term. Cloud subscriptions are recognised evenly as the service runs.[6] So a three-year Data Center deal can put much of its value into one quarter, while the same customer on Cloud pays into revenue month by month.

The end-of-life announcement changed the split. For Data Center contracts signed after 8 September 2025, “a higher proportion of total contract value is attributed to the term license component”, so more revenue lands at signing.[4] Atlassian said that effect alone added about 5.7 percentage points to Data Center growth and about 1.6 points to total growth in its September 2025 quarter.[4] In the March 2026 quarter, its largest Data Center renewal quarter, growth of 44% was “primarily driven by the DC EOL revenue recognition impact, pricing, pull-forward of customer purchasing into Q3 from future periods, partially offset by continued migrations to Cloud”.[5]

**Figure: The wind-down front-loaded Data Center revenue into last year, so this year shows a fall**

*How Atlassian books a Data Center contract, and what changed after the end-of-life notice of 8 September 2025*

1. 01A term licence is signedThe customer runs Jira or Confluence on its own servers for a set term, support included.
2. 02The price is splitThe licence part is revenue at signing; the support part is spread over the term.
3. 03The notice moves the splitFrom 8 September 2025 more of each contract counts as licence, and customers buy early.
4. 04The next year looks smallerFY27 laps that bump: Data Center guided to fall about 16%, Cloud to grow about 26%.

Source: Atlassian Form 10-K FY2026; shareholder letters Q1 FY26, Q3 FY26 and Q1 FY27 · as of 6 November 2026

The FY2026 annual report adds a second drag: Cloud revenue is “typically lower in the initial year compared to our Data Center offerings”, which “may impact our near-term revenue growth rates and margins”.[6] Atlassian also said the timing of Data Center revenue lifted its FY26 non-GAAP operating margin by about four percentage points.[2]

## The targets went up on 5 November, not down

For the quarter to December, Atlassian expects revenue of US$1,825m to US$1,835m, Cloud growth of about 27% and a Data Center decline of about 14%. For the year to June 2027 it expects revenue growth of about 13.75%, Cloud growth of about 26% and a Data Center decline of about 16%.[1] Each of those full-year targets is higher than in August: revenue from about 13.0%, Cloud from about 25.5%, Data Center from a fall of about 17%, and Subscription ARR growth by the end of the year from 18.0% to 18.5%.[2] Atlassian said migrations from Data Center will add “mid-to-high single-digits” to Cloud growth this year, and that it expects total growth to “re-accelerate in FY28 as we lap these effects”.[2]

**Figure: Revenue growth of about 13.75% this year, raised from 13.0%, with Data Center the only line shrinking**

*Atlassian's targets as of 5 November 2026, for the quarter to December 2026 and the year to June 2027*

13.75%

FY27 revenue growth, up from 13.0% in August

Atlassian

−16%

FY27 Data Center revenue, from −17% in August

Atlassian

−14%

Data Center revenue, quarter to December 2026

Atlassian

18.5%

Subscription ARR growth by June 2027, from 18.0%

Atlassian

Source: Atlassian Q1 FY27 press release and shareholder letter · as of 5 November 2026 · All targets are approximate, as Atlassian states them; August figures are its previous guidance

TechBag countTechBag count: what the targets imply for the rest of the year

About 13.75% on last year’s US$6,572.3m is roughly US$7,476m. Take away this quarter’s US$1,772m and the midpoint of next quarter’s range, US$1,830m, and the second half comes to about US$3,874m, about 9% above the same half last year (US$3,553m), the half that held the 44% Data Center quarter. On the same basis, Data Center would be about US$1,538m for the year and about US$773m in the second half, roughly a quarter below last year’s US$1,023m. The targets are Atlassian’s; the arithmetic is ours.[1][10]

The market read the same numbers differently. Shares fell more than 17% in extended trading on 5 November, SiliconANGLE reported, as investors focused on Subscription ARR growth slowing to about 18.5% by the end of the year from 22.5% in the quarter; it also reported the stock had nearly doubled between the August results and late October.[12] They were down roughly 16% in premarket trading on 6 November, Investing.com reported, and Truist Securities cut its price target to US$200 from US$250, citing a cautious outlook that “increases scrutiny on the durability of Cloud growth and margin profile”.[13] The same filing carried a change of Chief Accounting Officer: Gene Liu leaves on 13 November after more than 12 years, and Eli Berkovitch, Box’s Chief Accounting Officer from April 2021 until October 2026, starts on 16 November. The filing says Liu’s decision is not the result of any disagreement with the company.[3]

## The dates every Data Center customer now runs on

Atlassian’s end-of-life page sets the timetable to the minute. New customers lost the ability to buy Data Center subscriptions or Data Center Marketplace apps on 30 March 2026 at 23:59 PST. Existing customers can keep buying new subscriptions, apps and expansions until 30 March 2028. On 28 March 2029 at 23:59 PST, subscriptions and their Marketplace apps expire and the products become read-only.[7] Until then Atlassian promises technical support, “security bug-fixes for critical vulnerabilities” and connectors to Atlassian Cloud.[7]

**Figure: Three and a half years from the notice to read-only: new sales stopped in March, expansions stop in 2028**

*Atlassian's Data Center end-of-life and pricing dates, September 2025 to March 2029*

| Date | Event | Detail |
| --- | --- | --- |
| 8 Sept 2025 | End of life announced | Atlassian Ascend: Data Center to be wound down over about three years |
| 15 Jan 2026 | Price notice | Data Center customers told of increases |
| 17 Feb 2026 | List prices up 15% | Jira, Confluence and Jira Service Management Data Center |
| 30 Mar 2026 | No new customers | New Data Center subscriptions and apps no longer sold to new customers |
| 5 Nov 2026 | FY27 target | Data Center revenue to fall about 16% in the year to June 2027 |
| 30 Mar 2028 | Last purchases | End of new subscriptions, apps and expansions for existing customers |
| 28 Mar 2029 | End of life | Subscriptions expire; products and apps become read-only |

Source: Atlassian Data Center End of Life page; IR notice of FY26 Data Center pricing changes; Q1 FY27 press release · as of 6 November 2026 · Applies to Jira Software, Jira Service Management, Confluence and Crowd Data Center; not Bitbucket, Bamboo or Jira Align

Renewals between those dates are allowed, but they “cannot extend beyond March 28, 2029” and a 12-month renewal that runs past it is prorated. Data stays readable after expiry, but Atlassian “strongly” advises against keeping a read-only instance connected to the internet, since no security fixes follow.[7] Some customers will be allowed multi-year extensions beyond 28 March 2029 “by exception only”; the annual report describes an extended maintenance period of about three years for certain customers.[7][6] Bitbucket and Bamboo Data Center will not reach end of life; their customers move to a Bitbucket Hybrid License that covers both Data Center and Cloud.[7] Atlassian has done this before: it ended maintenance and support for its older Server products in February 2024.[11]

## What changes for a customer leaving Data Center

Data Center prices have gone up as the end approaches. From 17 February 2026, list prices for Jira, Confluence and Jira Service Management Data Center rose 15% across all user tiers, and about 25% for Jira customers on older “advantaged” plans, depending on tier; customers could renew early at the old price before that date.[8] A 500-user Jira Data Center licence went from US$51,000 to US$59,000 a year, and a 500-user Confluence licence from US$32,000 to US$37,000.[9]

Cloud is not cheaper per seat, by Atlassian’s own account: “The per user cost of cloud is higher than Data Center, but what you get for this in cloud is significantly more impactful.” It offers customers buying Cloud Enterprise by June 2027 a possible 10–20% discount on the first year, and qualifying customers a credit for the unused part of their Data Center maintenance.[7] Cloud also brings metered AI: Atlassian says more than 87% of its enterprise Cloud customers use Rovo[2], and from 3 December it bills Rovo use beyond the included credits, with the setting that allows it on by default, as we reported in [Rovo AI overage is now on by default](https://www.thetechbag.com/blog/atlassian-rovo-overage-billing-on-by-default).

**Figure: Data Center is cheaper per user but closing; Cloud costs more per user and carries the AI features**

*Atlassian's two deployment options for Jira, Confluence and Jira Service Management, as Atlassian describes them, November 2026*

Data Center (self-managed)

- Runs on the customer’s own infrastructure, under a term licence with support bundled
- Not sold to new customers since 30 March 2026; read-only after 28 March 2029
- List prices up 15% from 17 February 2026: 500 Jira users, US$59,000 a year
- Extensions past 2029 only by exception; Bitbucket and Bamboo continue

Cloud (hosted by Atlassian)

- Hosted on AWS; data can be pinned to a location, including India, on Standard, Premium and Enterprise plans
- “The per user cost of cloud is higher than Data Center”, Atlassian says
- Rovo AI included in credits, with metered use beyond them
- Single-tenant Isolated Cloud for the strictest requirements; FedRAMP Moderate Government Cloud in the US

Source: Atlassian Form 10-K FY2026; Data Center End of Life page; Data Center list-price tables; data residency documentation · as of 6 November 2026

Our viewWhat to watch

Atlassian says Subscription ARR “normalizes variable revenue patterns and the timing effects” of revenue recognition, so it is the figure that shows whether customers stay through the move; revenue will look weaker than ARR until the year to June 2027 has lapped the Data Center bump.[2] The next markers are the 30 March 2028 cut-off for expansions, after which a growing Data Center customer can no longer add users, and how many customers ask for the exceptions Atlassian offers past 2029.[7]

In India: the same 2029 deadline, and a Mumbai location for Cloud data

Atlassian’s end-of-life page gives one timetable, in Pacific time, with no regional exceptions apart from the US government provisions, so the 30 March 2028 and 28 March 2029 dates apply to Data Center customers in India as everywhere.[7] Atlassian does not report Indian revenue; its Asia Pacific revenue was US$190.0m in the quarter, up 18%, the slowest of its three regions (Americas up 25%, EMEA up 24%).[2]

For organisations that kept Data Center to hold data in India, Atlassian Cloud offers an India data residency location in the AWS Asia Pacific (Mumbai) region for Jira, Jira Service Management, Confluence, Jira Product Discovery and Loom, on Standard, Premium and Enterprise plans. It is not the default, “even for organizations based in India”: an admin has to set it.[14] Whether that meets a particular regulator’s rule is for the regulated entity to judge; Atlassian’s page makes no claim about Indian regulation.

Data Center list prices are published in US dollars and yen, with no rupee table.[9] The 500-user Jira renewal at US$59,000 is about ₹55.7 lakh at the European Central Bank’s cross rate of ₹94.48 for 5 November, and a GST-registered business importing the service pays 18% GST under reverse charge, about ₹10.0 lakh more.[15][16] TechBag covers the products on [its Atlassian hub](https://www.thetechbag.com/atlassian) and the [Jira intel page](https://www.thetechbag.com/atlassian/atlassian-jira).

How we did this

Figures as of 6 November 2026, 7pm IST

Quarterly Cloud and Data Center revenue is from each quarter’s own Form 8-K release, Q1 FY25 to Q1 FY27; full-year figures are from the FY2026 Form 10-K. Targets, the previous targets and Atlassian’s explanations are from its press release and shareholder letter of 5 November 2026; the mechanism of revenue recognition is from the 10-K and the Q1 FY26 and Q3 FY26 shareholder letters. Dates and prices are from Atlassian’s end-of-life page, its pricing notice and its price tables. Shares of revenue, the implied second half, the FY27 Data Center level and the rupee figures are our arithmetic on Atlassian’s approximate targets. Share-price moves are as reported by SiliconANGLE and Investing.com; the earnings-call transcript was not yet published, and US trading on 6 November had not opened.

Spotted an error? Write to us; corrections are published at the foot of the piece.

Sources

1. [Atlassian: Atlassian Announces First Quarter Fiscal Year 2027 Results (Form 8-K, Exhibit 99.1)](https://www.sec.gov/Archives/edgar/data/1650372/000165037226000049/ex991q1fy27.htm) — 5 November 2026
2. [Atlassian: Q1 FY27 shareholder letter](https://s206.q4cdn.com/270053503/files/content_files/index-4.html) — 5 November 2026 also filed as Exhibit 99.2 to the 8-K
3. [Atlassian: Form 8-K, Items 2.02 and 5.02 (Chief Accounting Officer)](https://www.sec.gov/Archives/edgar/data/1650372/000165037226000049/team-20261105.htm) — 5 November 2026
4. [Atlassian: Q1 FY26 shareholder letter](https://s206.q4cdn.com/270053503/files/doc_financials/2026/q1/TEAM-Q1-2026-Shareholder-Letter.pdf) — 30 October 2025
5. [Atlassian: Q3 FY26 shareholder letter](https://s206.q4cdn.com/270053503/files/doc_financials/2026/q3/TEAM-Q3-2026-Shareholder-Letter.pdf) — 30 April 2026
6. [Atlassian: Annual Report on Form 10-K, fiscal year ended 30 June 2026](https://www.sec.gov/Archives/edgar/data/1650372/000165037226000036/team-20260630.htm) — filed 14 August 2026
7. [Atlassian: Data Center End of Life](https://www.atlassian.com/licensing/data-center-end-of-life) — page modified 6 November 2026, 00:36 UTC
8. [Atlassian Investor Relations: Notice of FY26 Data Center Pricing Changes](https://s206.q4cdn.com/270053503/files/doc_financials/2026/q2/Fiscal-2026-Data-Center-Pricing-Notice.pdf) — January 2026 (customers notified 15 January 2026)
9. [Atlassian: Future Data Center list pricing tables](https://www.atlassian.com/licensing/future-list-pricing/data-center-pricing/pricing-tables) — prices effective 17 February 2026
10. [Atlassian: quarterly results, Form 8-K Exhibit 99.1, Q1 FY25 to Q4 FY26](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001650372&type=8-K) — 31 October 2024 to 6 August 2026 releases of 31 Oct 2024; 30 Jan, 1 May, 7 Aug and 30 Oct 2025; 5 Feb, 30 Apr and 6 Aug 2026
11. [Atlassian: Annual Report on Form 10-K, fiscal year ended 30 June 2025](https://www.sec.gov/Archives/edgar/data/1650372/000165037225000036/team-20250630.htm) — filed 15 August 2025
12. [SiliconANGLE (Duncan Riley): Atlassian shares fall 17% as slower subscription growth forecast overshadows earnings beat](https://siliconangle.com/2026/11/05/atlassian-shares-fall-17-as-slower-subscription-growth-forecast-overshadows-earnings-beat/) — 5 November 2026
13. [Investing.com: Atlassian tumbles 16% on weaker subscription growth outlook](https://www.investing.com/news/stock-market-news/atlassian-tumbles-16-on-weaker-subscription-growth-outlook-5005613) — 5 November 2026, updated 6 November 2026
14. [Atlassian Support: Understand data residency](https://support.atlassian.com/security-and-access-policies/docs/understand-data-residency/) — last published 3 November 2026
15. [European Central Bank euro reference rates, USD/INR cross rate (via the Frankfurter API)](https://api.frankfurter.app/2026-11-05?from=USD&to=INR) — 5 November 2026
16. [India Briefing: Digital services in India: OIDAR, GST applicability and compliance](https://www.india-briefing.com/news/tax-digital-services-oidar-in-india-gst-applicability-and-compliance-22465.html) — updated 29 September 2023

**Disclosure.** TechBag is a software reseller: it earns a margin when a reader buys through it, including from vendors named here. The analysis is TechBag’s own; no vendor paid for or saw this piece before publication. Facts are labelled reported, TechBag count or our view.

**Read this next:** [Rovo AI overage is now on by default, not off: Atlassian bills it from 3 December](https://www.thetechbag.com/blog/atlassian-rovo-overage-billing-on-by-default) — Atlassian's other billing change: Rovo AI overage is billed from 3 December, and the setting that allows it is on by default, not off.

Go deeper on TechBag

- [The Atlassian hub](https://www.thetechbag.com/atlassian) — Jira, Confluence, Jira Service Management, Bitbucket and Trello, Cloud and Data Center
- [Atlassian Jira intel page](https://www.thetechbag.com/atlassian/atlassian-jira) — Cloud versus Data Center, the tiers and the migration
- [ITSM and service desk guide](https://www.thetechbag.com/browse/endpoint-management/itsm-service-desk) — where Jira Service Management sits among the service desks