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Atlassian Co-CEO Scott Farquhar Resigns, Leaving Mike Cannon-Brookes as Sole Chief

(Bloomberg) -- Atlassian Corp. Co-Chief Executive Officer Scott Farquhar is stepping down from the Australian software company he helped start more than two decades ago, a surprise move that rattled investors.

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Farquhar’s counterpart, Mike Cannon-Brookes, will become the sole CEO, the company said Thursday in a statement. The departing executive will step down Aug. 31 and remain on Atlassian’s board. Farquhar plans to “spend more time with his young family, improve the world via philanthropy and help further the technology industry globally,” according to the statement.

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The shares slipped about 10% Tuesday morning in New York, hitting the lowest point in five months.

Many investors “see key-person risk around the co-founders as one of the long-term worries,” wrote Bernstein analyst Peter Weed in a note. “Today at least half that risk was realized — perhaps not surprisingly the stock is down.”

The company — known for collaboration applications Jira and Trello — has faced some investor skepticism as it works through a a transition to the cloud for holdout on-premise customers.

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(Corrects Scott Farquhar’s name in an earlier web headline.)

Separately, Atlassian reported fiscal third-quarter revenue was $1.19 billion, above the average analyst estimate of $1.11 billion. Profit, excluding some items, was 89 cents per share, beating the 62 cents projected by analysts. Still, the company added customers more slowly than anticipated.

Bloomberg Intelligence analyst Sunil Rajgopal was more optimistic on the executive transition, saying that, while it was a surprise, “it should not impact the operations as the company is in strong footing.”

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