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Atlassian, Australia’s largest listed technology company, has said it will cut 10 per cent of its staff as the software company responds to the threat posed by AI to its operations. 

The company, which develops enterprise software and is listed in the US, is to cut 1,600 roles across its global operations. Mike Cannon-Brookes, co-founder and chief executive of Atlassian, on Thursday said the move signalled it was “choosing to adapt” decisively to “drive durable, profitable growth”. 

The Sydney-based company has been one of the worst-performing stocks on the Nasdaq this year amid fears that AI platforms could wreak havoc on its business model. Its shares have more than halved this year and lost two-thirds of their value over the past 12 months.

Atlassian said in an exchange filing that chief technology officer Rajeev Rajan, who has been with the company for four years, would step down as part of the restructuring. The company said it expected up to $236mn in costs associated with severance payments, benefits and office space reduction.

In a note to staff, Cannon-Brookes said its fundamental approach was not that “AI replaces people” but that the company needed to adapt. “It would be disingenuous to pretend AI doesn’t change the mix of skills we need or the number of roles required,” he wrote.

Cannon-Brookes said it had made the cuts with a view to retaining “Atlassians with the skills to help us thrive as an AI-first company”. That included “strong performers, graduates and Atlassians with transferable skills”.

Around 30 per cent of the job cuts will be made in its Australian operations in the latest blow to the country’s technology sector.

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WiseTech, a Sydney-based logistics software company, said last month it would cut 2,000 jobs. Block, a payments company that owns Australia’s Afterpay, cut around half of the 1,300 roles in the country as part of a wider redundancy round. 

In recent months, Atlassian had pointed to continued growth in its customer base and revenue and argued that AI could prove to be “sustaining” technology for its existing software.

But a huge sell-off in the shares of software companies, dubbed the “SaaSpocalypse”, has fuelled the perception that companies such as Atlassian may become less reliant on high revenue growth and will become more reliant on price rises and cross-selling in the future.