(Bloomberg) — Atlassian Corp. Co-Chief Executive Officer Scott Farquhar is leaving the Australian software company he helped start more than two decades ago, a surprise move that shook investors.
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Farquhar’s counterpart, Mike Cannon-Brookes, will become sole CEO, the company announced in a statement Thursday. The outgoing executive will step down on August 31 and remain a member of Atlassian’s board of directors. Farquhar plans to “spend more time with his young family, improve the world through philanthropy, and contribute to the development of the technology industry globally,” according to the release.
Stocks fell about 10% Tuesday morning in New York, hitting their lowest level in five months.
Many investors “see key person risk around co-founders as one of the long-term concerns,” Bernstein analyst Peter Weed wrote in a note. “Today, at least half of that risk has been realized – perhaps it’s not surprising that the stock is down.”
The company – known for its collaboration apps Jira and Trello – has faced some investor skepticism as it works on a transition to the cloud for reluctant on-premises customers.
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(Corrects Scott Farquhar’s name in an earlier web title.)
Separately, Atlassian reported third-quarter revenue of $1.19 billion, above analysts’ average estimate of $1.11 billion. Profit, excluding certain items, came to 89 cents per share, beating the 62 cents expected by analysts. Still, the company added customers more slowly than expected.
Bloomberg Intelligence analyst Sunil Rajgopal was more optimistic about the leadership transition, saying that while it was a surprise, “it should not have an impact on operations as the company is on solid foundations.
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