Brutal second Atlassian boss Mike Cannon-Brookes fires 1,600 staff over e-mail: ‘It is the suitable determination’

Australian tech entrepreneur Mike Cannon-Brookes has axed more than 1,600 Atlassian workers, informing impacted staff via an email.

Cannon-Brookes said AI had impacted ‘the mix of skills we need’ and ‘the number of roles required in certain areas’. 

About 30 per cent of the impacted employees are based in Australia.

Workers affected by the cuts received emails within 20 minutes of Cannon-Brookes outlining the decision in a video message to staff. 

‘Days like these are among the toughest that we have as a company, and certainly the toughest that I have as a leader,’ he said.

‘I am deeply sorry for the disruption this creates in your life. 

‘Even at a moment like this, and especially at a moment like this, your impact and contributions matter enormously. 

‘I want to say thank you for all of those contributions. Your work will live on in our products, in the experiences of our customers, and in the culture you’ve helped us build. 

‘What I do want to say is that I have made this call because I believe it is the right decision for Atlassian in the long term. It is an incredibly hard decision, but I still believe it is the right one.

‘We are focused on moving faster, staying disciplined on costs, and proving that we can grow profitably over the long term by remaining responsive to the world we operate in.

‘At the same time, we are a people company. That shows in how carefully roles were considered, how we are supporting those who are leaving as they move on to the next chapter of their journeys, and how we treat each other, especially those who are impacted.

‘This is an example of what “build with heart and balance” looks like in practice, doing the right thing for Atlassian while acting with humanity and doing the right thing for everyone affected by these decisions.

‘Please be kind to yourselves and to each other. Check in on your teammates and your friends. Give people the space they need to process and lean on the support we are making available to everyone.

‘Whether you are staying or your role is impacted, you are an important part of Atlassian’s story, and I am extremely grateful for all that you have helped us build.’

Atlassian’s stock has tumbled 50 per cent since the start of 2026 and is now down 66 per cent year-on-year as investors fear AI could shrink corporate workforces – and demand for workplace software.

The company soared to a US$162billion valuation in 2021 during the Covid-19 work-from-home tech boom, but its market cap has since slumped to about US$19.90bn.

Atlassian earns much of its revenue by charging companies per user.

If businesses can use AI to do the work of 10 employees with just two staff, they may only need two licences instead of 10, potentially slashing revenue from that customer by up to 80 per cent.

Newer AI agents can also complete multi-step tasks such as researching a problem, writing code to solve it, testing the result, and refining it without constant human input.

Investors fear that if AI allows large companies to operate with smaller teams, demand for many workplace software products such as those offered by Atlassian could slow across the tech sector, dragging down company valuations. 

As his company faces growing market pressure, Cannon-Brookes is also navigating a complex divorce from his ex-wife Annie after they split in July 2023.

Beyond Atlassian shares, the couple’s reported asset pool totals about $10bn, including a property portfolio valued at roughly $360million.

Some of those holdings include high-profile sporting investments. Cannon-Brookes became the youngest current owner of a US NBA franchise in 2020 after spending hundreds of millions to become co-owner of the Utah Jazz.

In 2021, he also acquired a 25 per cent stake in NRL club the South Sydney Rabbitohs.

Neither Cannon-Brookes nor his wife have publicly commented on the breakdown of their relationship or how their shared investments will ultimately be divided.

Despite the market and marriage turmoil, Cannon-Brookes insisted Atlassian was building a “f****** great business” during a quarterly earnings investor meeting earlier this year.

But in the month leading up to the results, he continued selling roughly 7,665 shares a day, at prices ranging from US$161.11 per share on January 8 to US$105.14 by February 4.

‘I’m convinced AI is great for Atlassian. Others think software is dead,’ Cannon-Brookes told shareholders.

‘In this environment it seems that noise swamps signal, nuance gets lost.

‘AI is the most important technology of our generation.

‘And you’ve heard me say AI is the best thing to happen to Atlassian. At the same time you’ve probably heard a lot of people say SaaS (software-as-a-service) is over, and software is dead.

‘Well I want to take the opportunity to share a few thoughts about why AI is great for Atlassian… For most people AI becomes most valuable when it shows up inside the workflows, business processes and applications that they run their business on, or choose to run their business on, and that’s exactly what we’re doing today.’

Last month, Atlassian paused hiring across engineering roles, with some candidates saying offers were withdrawn and others claiming communication stopped entirely.

‘Got an engineering offer… After three weeks of silence I finally messaged the hiring manager on LinkedIn. They told me it’s a hiring freezing,’ 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 reads.