Atlassian Corporation Plc (NASDAQ:TEAM) Q4 2023 Earnings Call Transcript

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Fred Havemeyer: Hi, thank you very much the question. Firstly, actually another thank you for introducing a dark theme as well to Jira. I think for people like me greatly appreciate it, especially when I’m on with some of my colleagues in Australia late at night. The question right now is really focusing on the migration tooling that you have. As you’re looking at and kind of reviewing the learnings that you have and the investments you’ve made into your migration tooling? Just how confident are you that at this point, you have the server to either data center or cloud migration tooling on-ramp capabilities really solved versus are there any significant risks you still see for some of those larger enterprise customers out server end of life to need to wait a little longer to have either like additional tools built out?

Mike Cannon-Brookes: Hey, Fred, I can take that. It’s Mike, and thanks for the kudos on dark team and Jira. It’s a good example of the amazing R&D team we have. It’s done properly with design tokens and all sorts of things across our cloud platform using Atlas Kit. So it will be coming to other products shortly. It’s already in hand for products that you see well across the area with a huge focus on accessibility, which has kept us into migrations. Dark team is quite challenging to do in an accessible way that works to meet all of the standards required for people who have accessibility issues when it comes to software. Gets to some of the migration tooling questions that you’ve asked. Our migration tooling continues to improve quarter-on-quarter.

We work really hard on the tools to make that as self-service as possible. And largely what we are doing is continue to work on the scale and speed of the tools to move huge amounts of data faster and faster the repeatability of those tools. Customers don’t do one-shot migrations, especially the larger ones. They will migrate their data across, test it, migrate it again and do that multiple times. So the tooling becomes incredibly important to be repeatable and reliable. And lastly, we work with customers who have lots of edge cases, some of them have 10 to 20 years of Jira family or Confluence data on-prem. They may have added their own database, they may have done a whole lot of things that we have to take these edge cases to move them across.

We continue to work on how to do that as we get bigger and bigger customers, and we can counter more and more edge cases, more of the tooling is self-service and repeatable. And lastly, we are continuing to work with app vendors and our amazing marketplace community to make sure that their app data and the apps themselves can be migrated as they move from our on-premise extensibility and plug-in systems to connect and forge in the cloud. That’s quite a unique migration challenge. I would say every quarter, we get better and better at doing this. We can use less human power to do migrations. We can do bigger migrations. And I’m really proud of how the team is going on managing all of that tooling. So continuing to improve I don’t know it’s — your question was around, is it solved, it will get better every single quarter as it has done for the last three years, and we’ll continue to do that as we migrate more and more server and data center customers at the time.

Operator: Your next question comes from Peter Weed from AllianceBernstein. Please go ahead.

Peter Weed: Thank you. And great to see IT service management growth called out on the note. It was top of mind for us, too. We see it as a really large opportunity for you going forward. And obviously, it already is a large business. really impressive to see the 45,000 customers and 80% year-over-year growth. Kind of looking forward, how should we think about the total upside from here? Like what are the profile of the companies that on the largest opportunity going forward that will drive more growth? And how much additional headroom do you see in this over the coming kind of 3-ish years?

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