Atlassian: Investor says $63 billion wipeout overdone
Homegrown software giant Atlassian tumbled another 8 per cent overnight, although some investors think its 70 per cent collapse is overdone.
Software giant Atlassian crashed another 8 per cent overnight as investors extended its 12-month wipeout to 71 per cent in erasing $US44 billion ($63 billion) from its value on worries AI agents will lead to plummeting demand for its software products.
Atlassian’s latest tumble came after US news reports said Amazon’s cloud computing business, Amazon Web Services, has developed an AI agent that theoretically handles the workloads of tech workers.
Atlassian shares closed at $US68.17 on Tuesday on Wall Street at their lowest level since 2018 and have lost around 6 per cent since its March 12 announcement that it would cut 1600 roles in part as it can automate them by using technologies linked to AI. The group’s chief technology officer Rajeev Rain was among the staff made redundant.
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Technology stocks have been hammered over the past 12 months as investors worry new AI tools and agents from Claude-owner Anthropic and Amazon will offset demand for workflow and customer management platforms traditionally sold by software companies.
Thomas Rice, the co-founder of funds management group Minotaur Capital said he thought the relentless selling across the software sector means some companies are now good value.
“I think software is close to maximum fear now, which we’re seeing with significant moves last night in Atlassian, Salesforce and Workday on this report that Amazon is building internal tools,” he said. “Amazon’s a tech-native company with world-class engineering doing what you’d expect them to do, but the vast majority of enterprises don’t have that capability and still need to buy software.”
“We were short software in January when valuations didn’t reflect the AI risk, but we now think the sell-off has overshot and is presenting good opportunities for investors with a three-to-five year horizon.”
The homegrown software giant’s chief executive, Mike Cannon-Brookes, who’s a former investor in one of Mr Rice’s technology-focused funds has repeatedly insisted the company is a net beneficiary from AI.
In February Mr Cannon-Brookes pointed to his Sydney-founded company’s revenue climbing 23 per cent to $US1.6 billion in the second quarter of financial year 2026 as evidence customers will spend more to use its AI-linked services.
In February, Atlassian also said it had introduced its own AI Rovo agent to assist users on its flagship Jira software platform, although investors are still worried demand for the platform will slow if its large corporate customers employ less tech workers.
Tech sector’s rollercoaster
On Wall Street on Thursday, shares in Alphabet-owner Google also tumbled nearly 4 per cent on a report ChatGPT-maker OpenAI is close to completing a record $US120 billion fund raising to invest in the race to dominate consumer-facing AI services.
Elsewhere, local shares jumped more than 2 per cent near lunchtime on news suggesting the US and Iran may reach a 15-point peace deal brokered by third parties including Pakistan.
Among the biggest tech movers locally was lung imaging group 4D Medical. It soared 37 per cent to $6.31 at lunchtime on a market cap of more than $3.6 billion after announcing a contract with leading US healthcare group the Mayo Clinic.
