On May 23, 2025, Moody’s raised its rating for Atlassian’s (NASDAQ:TEAM) senior unsecured notes to Baa2 from Baa3 and increased its senior unsecured shelf rating to (P)Baa2 from (P)Baa3, while maintaining a Stable outlook on the company. This upgrade is attributed to Moody’s confidence in Atlassian’s swift revenue growth, effective financial management, and cloud migration strategy.

Drivers of the Upgrade

• Revenue Expansion: Moody’s anticipates that Atlassian’s revenues will grow by over 20% annually within the next 12 to 24 months, driven by increased cloud subscription uptake.

• Profit Growth: Operating profits are expected to outpace revenue growth thanks to scalable infrastructure and higher-margin cloud services.

Investment in Cloud Expansion

Atlassian has committed resources towards enhancing the scalability, performance, and security of its cloud platform. These improvements are key to attracting enterprise clients transitioning from on-premises solutions. The addition of AI features in Jira, Confluence, and Opsgenie aims to boost customer retention while unlocking premium pricing options.

Financial Health and Metrics

Moody’s upgrade also reflects Atlassian’s prudent balance sheet management. According to the latest figures, Atlassian enjoys solid liquidity and manageable leverage levels, facilitating further credit metric improvements as cloud ARR increases and free cash flow accelerates.

With a leading position in the software development and IT management tools market, Atlassian’s strong credit rating and cloud-driven growth outlook enable it to seize opportunities in enterprise digitization without compromising financial flexibility for future innovations.