What happened

Shares of productivity software provider Atlassian (NASDAQ:TEAM) jumped sharply on Friday, rising as much as 13.6%. As of 12:00 p.m. EST, however, the stock was up 8.6%.

The stock's move higher on Friday follows the company's fiscal second-quarter results on Thursday afternoon. The Street is likely happy with the report because both revenue and non-IFRS (adjusted) earnings per share came in significantly higher than analysts' average forecasts.

A cartoon of Trello employees and the Trello logo

Image source: Atlassian.

So what

Atlassian's revenue in its second quarter of fiscal 2020 increased 37% year over year to $408.7 million. On average, analysts were expecting revenue of $388 million. The company's adjusted earnings per share were $0.37, up from $0.25 in the year-ago period and ahead of a consensus estimate of $0.27.

"We had a strong quarter, growing revenue 37% year-over-year and generating record profitability and free cash flow," said Atlassian co-founder and co-CEO Scott Farquhar in the company's fiscal second-quarter earnings release.

Subscription revenue was a key driver for the period, rising 50% year over year.

Along with its quarterly results, management also announced that Atlassian president Jay Simons is leaving the company in July of 2020.

Now what

For the tech company's fiscal third quarter, management guided for revenue between $395 million and $399 million, adjusted gross margin of 85%, and adjusted earnings per share of $0.20. For the full year of fiscal 2020, management expects revenue between $1.59 billion and $1.60 billion, adjusted gross margin between 85.5% and 86%, and adjusted earnings per share between $1.03 and $1.09.

"Atlassian has never been better positioned for success, and we look forward to continuing to grow with the frictionless business model that Jay helped build," said Farquhar in the earnings release.