Atlassian shares skyrocket after earnings and revenue top estimates

Atlassian shares rose more than 10 percent in extended trading on Thursday after the provider of collaboration software reported better-than-expected earnings for its fiscal second quarter. Executives will discuss the results with analysts on a conference call at 5 p.m. Eastern time.

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Here are the key numbers:

  • Earnings: 25 cents per share, excluding certain items, vs. 21 cents as expected by analysts, according to Refinitiv.
  • Revenue: $299 million, vs. $288.3 million as expected by analysts, according to Refinitiv.

Sales in the quarter ended Dec. 31, jumped 39 percent from a year earlier, according to a statement. Subscription revenue, its biggest segment, came in at $152.5 million, above the $150 million consensus of analysts polled by FactSet.

Atlassian also issued an optimistic forecast. For the fiscal third quarter, the company is expecting 18 cents in earnings per share, excluding certain items, on $303 million to $305 million in revenue. Analysts were looking for guidance of 18 cents in earnings and revenue of $300.7 million, according to Refinitiv.

Atlassian raised the prices of some products, including Confluence and Jira, in October.

“We see continued upside to estimates as we feel the pricing increases are not yet baked into Street expectations,” Joel Fishbein, an analyst at BTIG Research, wrote in a report on Wednesday. “We have heard of minimal pushback from buyers during recent price increases, suggesting that there is ample runway to better align compensation with value creation.”

But the company’s products are still very affordable, even with this round of pricing changes, Atlassian president Jay Simons told CNBC in an interview on Thursday. The effects of the increases have been in line with what executives would expect, he said.

“There’s not a negative reaction,” he said.

Atlassian stock dropped amid a wider market selloff in the fourth quarter, but in the past year the shares have surged 71 percent, outperforming Salesforce, Workday and other cloud stocks. The stock ended the trading session at $92.92 per share.

This is breaking news. Please check back for updates.

WATCH: Atlassian: We’re constant but measured risk-takers

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In defense of screen time

The Silicon Valley engineers who design our tech gadgets won’t let their kids anywhere near those devices, according to a shocking New York Times profile. These workers are convinced too much time in front of smartphones and iPads is rotting kids’ brains. Technology “is wreaking havoc on our children,” warned one former Facebook employee.

These parents need to relax. It’s true that allowing kids to browse social media until the wee hours of the morning isn’t a good idea. But it’s also true that smart phones, iPads and other gadgets are powerful educational tools, both at home and in the classroom.

Rather than demonize and ban all devices, parents should regulate screen time and ensure their children use technology in beneficial ways.

Despite the parental panic in Silicon Valley and well-educated communities nationwide, research suggests that screen time can be a net positive for children. Kids whose parents drastically limit screen time ultimately perform worse in college, according to a Swiss study of American universities.

And thanks to their immediate feedback and multimedia features, iPads are great reading tools. Compared to kids who only use books, kids who learn to read on iPads are more engaged, cooperative and willing to speak up, according to a researcher from the Institute of Education in London. Kids from low socioeconomic backgrounds who read on both books and iPads at home are more likely to perform at or above grade level in school.

It’s not the screen itself that’s good or bad — but what’s on it.

These studies show that it’s not the screen itself that’s good or bad — but what’s on it. Watching two hours of Cartoon Network is much different than watching a National Geographic documentary. Parents simply need to create straightforward rules for their kids. Regulating non-educational screen time or having a social media curfew are both good options.

At school, educators can use tech gadgets and apps to speed up the learning process while tailoring their lessons to support each student.

Consider DreamBox, a platform that allows elementary and middle schoolers to play different math games on their iPads. The tech tool mines more than 48,000 data points per student every hour to personalize lessons for individual users. Algebra Nation, a similar program, studies click-patterns to figure out when students are struggling and offer personalized advice.

Such “adaptive learning” platforms are already yielding impressive results in higher education. An adaptive learning tool at the Colorado Technical University increased a course’s pass rate by 27 percent and its final grade average by 10 percent.

Classroom tech also gives teachers a superhuman capacity to pinpoint and predict problems. For example, a school in Spokane, Wash. gives its students online surveys to track how focused they feel, how inclusive their social environment is and how often they feel like giving up, among other things. Educators then study this data via dashboards to understand where kids might need help, both inside and outside the classroom.

A decade ago, it would have been unrealistic to expect school faculty to track the day-to-day thoughts, feelings and engagement of each and every student — despite this being invaluable information for educators. With classroom tech, such practices can and should become standard.

No reasonable person thinks it’s good for kids to be glued to their screens 24/7 or to replace human interaction with an app. But the notion that screen time is intrinsically harmful for children is equally silly. It’s time for teachers and parents to stop the fear mongering and harness the latest technology to offer kids a world-class education.

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How Lyft envisions bringing VR and AR to your ride

Lyft is exploring ways to integrate virtual reality and augmented reality into your Lyft rides, according to a couple of patent applications TechCrunch came across today.

The first, filed in July 2017, is for “providing a virtual reality transportation experience” that would respond to real-world forces and events that happen during your ride, like sudden stops, turns and bumps in the road. Over time, the VR system would be able to predict those bumps and turns in the road.

“For instance, the virtual reality transportation system accesses the historical information for each maneuver along the route and identifies previous inertial forces that transportation vehicles have experienced in the past for the same turns, merges, stops, etc,” the application states. “In some cases, the virtual reality transportation system determines (e.g., calculates) an average of each of the previous inertial forces for the maneuvers along the travel route to predict the inertial forces that the passenger will experience.”

From there, the VR system would generate a virtual experience with virtual interactions based on the real-world environment. Specifically, the VR system may include, “but are not necessarily limited to, virtual collisions with objects, virtual turns, virtual drops, etc.”  That sounds mildly horrifying, but it would definitely make for an unforgettable ride. Other ideas of virtual experiences feature a game with lasers and flying saucers.

During your ride, Lyft envisions passengers being able to share their VR experience with people in other cars, or those waiting for a pick-up.

This is likely possible in part thanks to Lyft’s acquisition of Blue Vision Labs, an augmented reality startup, last year. Blue Vision, for example, offers collaborative augmented reality to enable people to see the same spot in space.

Lyft’s other patent application, also filed in July, seeks to provide information to passengers using augmented reality. This one seems to be less about entertainment and more about practical information.

In one example, Lyft would generate virtual objects to overlay on a passenger’s real-world surroundings in order to help with the pick-up or drop-off process. Based on historical data, Lyft envisions identifying the ideal pickup location based on the passenger’s current location, traffic conditions and transportation restrictions.

TechCrunch has reached out to Lyft and will update this story if we hear back.

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LIVE: Netflix reports its Q4 earnings now (NFLX)

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Netflix will report its Q4 earnings on Thursday after the market closes, just days after unleashing its biggest price hike ever, which increased its most popular plan from $11 per month to $13.

Wall Street is expecting results roughly in line with Netflix’s guidance.

But all eyes will be on Netflix’s subscriber growth this quarter, as well as its guidance for the next, as a sign of whether the price hike will hurt the streamer.

Netflix often swings wildly after earnings. But the stock has been on a tear since Christmas, rising 50%, so investors seem to be expecting good news already, which could dampen some of its rallying potential.

We will update this post as the numbers cross.

Here are the key numbers for Netflix’s Q4 earnings:

  • Q4 revenue: Wall Street estimates $4.21 billion and Netflix forecasts $4.20 billion.
  • Q4 earnings per share (GAAP): Wall Street estimates $0.24 and Netflix forecasts $0.23.
  • Q4 total subscriber growth (net additions): Wall Street estimates 9.2 million and Netflix forecasts 9.4 million. 

    • Q4 US subscriber growth (net additions): Wall Street estimates 1.83 million and Netflix forecasts 1.8 million.
    • Q4 international subscriber growth (net additions): Wall Street estimates 7.38 million and Netflix forecasts 7.6 million.
  • Q4 total paid subscriber growth (paid net additions): Wall Street estimates 7.6 million and Netflix forecasts 7.6 million.
  • Q1 total paid subscriber growth (estimated paid net additions): Wall Street estimates 8.5 million.

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The CEO of one of the hottest marijuana vape startups says the company is gearing up for an IPO this year

The CEO of one of the world’s most popular marijuana vape startups says the company is looking to go public this year.

“We’ve been talking to bankers, we’ve talked to the exchanges,” Pax Labs CEO Bharat Vasan told Business Insider in a Thursday interview. “The appetite has been overwhelmingly positive.”

The buzzy Silicon Valley-based vape startup already raised $20 million in funding last year and investors include blue-chip firms like Fidelity Investments and Tiger Global.

Read more: Marijuana could be the biggest growth opportunity for struggling beverage-makers as millennials ditch beer for pot

While Vasan did not give a specific IPO date, he said he’d like to take the company public on a US-based exchange like the NASDAQ — rather than on the Canadian Securities Exchange, a path that many marijuana industry startups have taken in the last few months to skirt federal prohibition of marijuana.

“We feel like US companies should be public on US exchanges as opposed to going abroad,” said Vasan.

That’s possible because Pax, despite their devices being used for consuming marijuana, is like any other software-and-hardware company. They don’t “touch the plant,” Vasan said, and therefore don’t traffic in any federally controlled substances.

Juul, the tobacco vape company that recently landed a $12.8 billion infusion from Altria, was spun out of Pax Labs in 2017.

Bharat Vasan, Pax Lab’s CEO.
Courtesy of Pax Labs

The ‘platform’ model, and why a Pax is like a Keurig

Vasan drew a comparison between Pax’s vapes and a Keurig coffee machine. Think of it like this: the Pax vaporizer, like the Keurig, is a “platform.” Other brands produce the actual coffee — or, in Pax’s case, the marijuana flower and oil pods — that the user plugs into the machine.

That means Pax isn’t reliant on any one partner.

“We’re kind of what I’d call a bellwether stock for cannabis,” said Vasan. “We index so broadly against all other companies in the space.”

Pax also has an “inbuilt” subscription model on top of that, with their Pax Era oil vaporizer device. The company sells the marijuana pods that fit into the device, so when people run out every few days or weeks, they’re buying new pods from Pax again.

It’s the “razor blade” model, says Vasan. “We feel fundamentally that’s a better business model than if you’re selling a product and you have to wait three years before someone buys it again.”

Read more: A $200 million marijuana VC breaks down how he picks what companies to invest in

Apart from that, Vasan said regulation is an ” absolute boon” for Pax, because it will eventually weed out some competition.

“We do expect a shakeout to happen,” said Vasan. “There are a lot of companies that are maybe playing it a little too fast and loose.”

Skye Gould/Business Insider

Because marijuana isn’t legal in all 50 states, being in the actual business of growing marijuana comes with a ton of risk. Like any other agricultural commodity, it’s also subject to rapid price compression and declining margins as the cost of growing quality marijuana gets cheaper.

In theory, price compression could actually work to Pax’s advantage because it drives consumer adoption, said Vasan. If it’s cheaper to buy marijuana, then more people may choose to buy it.

Pax, therefore, could be a way for investors to ride the upside of the marijuana wave, without much of the risks. And in a market downturn, marijuana could be one of the few sectors that actually benefit.

“Nothing is ever recession-proof,” said Vasan, but marijuana, like alcohol before it, tends to fare better than more “discretionary” purchases like, say, a new smart TV.

Marijuana is the ‘single largest thing that CPG has seen in the last 100 years’

Vasan took the CEO job at Pax last year after close to a decade of building and selling hardware startups. He most recently served as president and COO of August, a San Francisco-based startup that makes smart home equipment, and before that, sold Basis, a wearables company, to Intel.

“Look I think smart home is big, but smart home is basically 5 or 10 million people in the US,” said Vasan. “I think cannabis is tens if not hundreds of millions of consumers coming online not only in the US but internationally, and developing a habit like coffee.”

To Vasan, cannabis is a “100-year trend.”

“You’ve got brand-new sector with new content coming on the market,” said Vasan. It’s the single largest thing that CPG [consumer packaged goods] has seen in the last 100 years.”

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