What: Shares of Atlassian Corporation PLC (TEAM -1.06%) fell more than 20% Friday despite the recently IPO'd collaboration-software specialist's strong fiscal second-quarter 2016 results.

So what: Quarterly revenue climbed 45% year over year, to $109.7 million, which -- based on International Financial Reporting Standards (IFRS) -- translated to a slight increase in net income from the same year-ago period, to $5.1 million, or $0.03 per diluted share. On a non-IFRS basis, which primarily means excluding items like stock-based compensation and acquisition costs, Atlassian saw net income increase 33.6%, to $19.1 million, and 22.2% on a per-share basis, to $0.11. Analysts, on average, were anticipating adjusted net income of just $0.04 per share on revenue of $103 million.

Noting this was the company's first quarterly report since its IPO in December, Atlassian co-CEO Scott Farquhar called its performance "strong [...], with a combination of continued growth and profitability."

"We continue to leverage our highly automated distribution model to make deep investments in product development," Farquhar went on, "which most notably resulted in the launch of three purpose-built versions of JIRA that takes our flagship product into new markets. With products that support every aspect of team collaboration, we're well positioned to reach the Fortune 500,000 with the tools needed to create a more open and productive way to work."

In addition, Atlassian expects revenue in the current quarter to be in the range of $113 million to $115 million, which should result in an IRFS net loss per share of $0.05, and non-IFRS net income per share of $0.05 to $0.06.

For the full fiscal year 2016, it anticipates revenue of $443 million to $447 million, which should result in an IFCS net loss per diluted share of $0.11 to $0.10, and non-IFRS net income of $0.30 to $0.31. Free cash flow for the year is also expected to be $80 million to $83 million. Here again, Wall Street was only expecting adjusted full fiscal year net income of $0.19 per share, and revenue of $425.3 million.

Now what: So why the drop? For one, shares currently trade at a steep 400 times trailing 12-month earnings, and almost 80 times next year's estimates. And given the recent broader market pullback -- including a 3.2% decline from the Nasdaq Composite Index today as of this writing -- Atlassian is hardly alone in suffering the wrath of investors as they flee from the perceived dangers of high-multiple growth stocks.

At the the same, that's not particularly concerning considering Atlassian sits just on the cusp of sustained profitability, so these multiples should come down as net income continues to grow. If anything, I think investors should view this as an impressive first showing from a promising company as it invests in the early stages of its growth. For opportunistic shareholders willing to take advantage of this pullback, I think Atlassian could be a compelling candidate to beat the market going forward.