What happened

Shares of productivity software provider Atlassian (NASDAQ:TEAM) took a hit early Friday, declining as much as 11.1%. As of 12:15 p.m. EDT, however, the stock had recovered and was down about 8%.

The decline is likely due to both a bearish day in the market for tech stocks overall, as well as the tech company's fiscal first-quarter earnings report, which was released on Wednesday afternoon.

A chalkboard sketch showing a stock price falling

Image source: Getty Images.

So what

Atlassian reported strong fiscal first-quarter results, with revenue rising 26% year over year to $459.5 million. Growth was fueled by the addition of over 8,600 net new customers during the quarter.

While Atlassian easily beat analysts' average forecast for revenue of $440 million, the company missed the market when it came to guidance. Management guided for fiscal second-quarter revenue between $460 million and $475 million, below analysts' average forecast for $479.7 million.

Highlighting how tech stocks were hammered on Friday, the tech-heavy Nasdaq Composite was down more than 2% as of this writing. This likely worsened Atlassian's sell-off today.

Now what

Though some Atlassian investors were spooked on Friday, management is optimistic.

"We are laser focused on delivering the best experience to customers in the cloud by building powerful new editions like Cloud Premium and Cloud Enterprise," co-CEO Mike Cannon-Brookes said, "scaling products like Atlassian Access, and cementing partnerships with best-of-breed [software as a service] providers such as Slack."

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.