He told staff Atlassian was reframing itself as an “AI-first company”, and while artificial intelligence would not directly replace the roles, it was the core trigger for the change.
“We fundamentally believe people and AI create the best outcomes,” he said.
Mike Cannon-Brookes says the company is becoming “AI-first” as it restructures and eliminates roughly 1600 roles. Photo / Getty Iamges
“Our approach is not ‘AI replaces people’. But it would be disingenuous to pretend AI doesn’t change the mix of skills we need or the number of roles required in certain areas. It does.
“This is primarily about adaptation. We are reshaping our skill mix and changing how we work to build for the future.”
Impacted staff will receive a minimum 16-week global separation package with one week additional for each year of service, pro-rated bonuses for FY26, a US$1000 ($1693) technology stipend upon return of the company laptop, and an extra six months paid on healthcare plans for eligible employees and family.
“I believe this is the right decision for Atlassian,” Cannon-Brookes said.
“But that doesn’t mean it’s easy. Far from it. I know this has a huge impact on each of you, and it weighs heavily on me and Atlassian today.
“We are doing this to self-fund further investment in AI and enterprise sales, while strengthening our financial profile. We’re also changing the way we work and reorganising around our System of Work to move faster.”
The restructure is estimated to cost Atlassian up to US$236 million, with most of this going to the cost of severance packages and the rest to “exit charges associated with office space reductions”.
The company’s new A$1.45 billion ($1.75b) headquarters in Sydney is still under construction.
Cannon-Brookes loses A$7.2 billion in utter bloodbath
This all comes as Cannon-Brookes – one of Australia’s richest men – lost almost half his net worth amid a brutal global tech sell-off sparked by fears AI will make his company obsolete.
The climate activist and net zero champion, who was worth A$14.9b just last year, now has a net worth of around A$7.7b as his company Atlassian’s share price continues a brutal downward spiral.
He came out swinging this week, saying claims AI would kill his company are “ludicrous”.
Atlassian is a leading Australian-American software company that develops products for software development, project management and team collaboration.
The company became a Nasdaq-listed tech powerhouse that generated billions of dollars in revenue, but its share price has plummeted almost 74% in the past 12 months.
The shift towards artificial intelligence is reshaping the types of skills and roles tech companies say they need inside modern software teams. Photo / Getty Iamges
One of the big factors driving this decline is the fear that AI makes traditional Software-as-a-Service (SaaS) companies like Atlassian obsolete.
In early February this year, companies like Anthropic and OpenAI released “AI agents” that can autonomously manage tasks and write code. Investors fear these agents will replace the human software developers who are Atlassian’s primary users.
Atlassian also makes money based on how many “seats” (users) a company pays for. If a firm uses AI to do the work of 10 people with just two, for example, Atlassian loses 80% of its revenue from that client.
Atlassian’s large corporate customers may, in the future, not need as many IT staff given AI can now do many tech workers’ roles, such as coding.
On the surface at least, Cannon-Brookes’ Sydney-founded company is still growing. It reported an adjusted net profit of US$320.9m in the December quarter, up from US$255.6m in the prior corresponding quarter in December 2024. Total sales also grew 23% to US$1.6b.
However, investors are clearly not impressed with the rate of growth and are spooked by projections showing growth slowing from 23% down towards the high teens. In the brutal world of Wall Street trading, any sign of deceleration can lead to a massive sell-off.
Despite this, Cannon-Brookes told investors he “couldn’t be more bullish” about the opportunities ahead, despite relentlessly selling his own shares in the company daily.
The Nightly reports he kept selling 7665 shares on a daily basis even in the month before the results at prices ranging from US$161.11 a share on January 8 to US$105.14 on February 4.
Cannon-Brookes appeared on venture capitalist Harry Stebbings’ 20VC podcast this week, saying claims that SaaS is dead were “ludicrous”.
“Apparently, we’re some sort of cavemen sitting around banging on clicky, clacky keyboards and writing assembly code who haven’t figured out large language models,” he said. “We’re not just bolting on AI features, we’re building it.”
Atlassian freezes hiring
Amid the share price tumble and AI fears, Atlassian last month called a halt on hiring engineers and filling other related roles, rolling back its global recruitment.
Desperate applicants claim they’ve been “ghosted” or had offers snatched away at the eleventh hour.
Job seekers have taken to social media and employee forums like Blind to vent their frustrations after being caught in the sudden recruitment shutdown.
Tech companies are pouring investment into AI infrastructure and automation as they adapt their business models to the next wave of computing. Photo / Getty Iamges
“Got an [engineering] offer … After three weeks of silence I finally messaged the hiring manager on LinkedIn they told me its a hiring freezing [sic],” one person posted on employee forum Blind.
“Same my interview in 6 hours was just cancelled and all I was told was the position is no longer available. Very frustrating as I’ve been prepping for weeks,” another post from last week reads.
Atlassian employs more than 12,000 people and usually has hundreds of positions available. But its global jobs board now shows just 40 vacancies in sales and a dozen positions for general interns and graduates.
Billionaire admits to ‘deep internal conflict’ over private jet
Cannon-Brookes is known for being one of Australia’s richest men, but he has also made a name for himself in the political world by championing the move towards net zero.
But while ordinary Aussies are asked to make big changes, the 46-year-old decided to treat himself to a ritzy new private jet late last year, admitting to a “deep internal conflict” over the carbon-heavy method of travel.
The Atlassian co-founder and chief executive bought a Bombardier 7500 and will use it to travel across his vast business operations, which include a minority stake in the Utah Jazz NBA team and a sponsorship deal with Formula 1.
In a statement posted to LinkedIn, Cannon-Brookes confirmed the purchase of the jet and acknowledged it would be a “carbon-intensive” way to travel.
“I’m not denying I have a deep internal conflict on this,” he said.
“There’s a couple of reasons I’ve purchased a plane.
“Personal security is the primary reason (an unfortunate reality of my world) but also so I can run a global business from Australia, and still be a constantly present dad.
“So, this is a hard, continual trade-off I’ve decided to make.
“Although private aviation is far from a big contributor to global emissions, it is a carbon-intensive way to travel.”
The Bombardier 7500 boasts GE Passport engines, a maximum range of 7700 nautical miles, a top mach speed of 0.925 and can carry up to 19 passengers.
Cannon-Brookes said he would “far exceed” his carbon flight footprint with “an extremely rigorous carbon regime”, including the use of direct air capture and sustainable fuels.
Mike Cannon-Brookes’ purchase of a Bombardier Global 7500 has drawn scrutiny amid his climate advocacy and the company’s restructuring. Photo / Getty Images
“These options aren’t practical for commercial flights but are viable privately,” he said.
“This means my flights actually have a net negative carbon footprint.
“My commitment to climate is as strong as ever. I’m still pretty damn focused on making an impact at a large scale, removing huge volumes of emissions through active investments and philanthropy … and have the proud scars to prove it.”
He is a key investor in SunCable’s giant Australia-Asia PowerLink project, which hopes to funnel energy from solar farms in the Northern Territory to Singapore via a subsea power cable.
More to come
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