Atlassian Announces Third Quarter Fiscal Year 2025 Results
Revenue of $1,357 million, up 14% year-over-year
Subscription revenue of $1,273 million, up 19% year-over-year
GAAP operating margin of (1)% and non-GAAP operating margin of 26%
Cash flow from operations of $653 million and free cash flow of $638 million
TEAM Anywhere/SAN FRANCISCO, May 01, 2025--(BUSINESS WIRE)--Atlassian Corporation (NASDAQ: TEAM), a leading provider of team collaboration and productivity software, today announced financial results for its third quarter ended March 31, 2025. A shareholder letter was posted on Atlassian's Work Life blog at http://atlassian.com/blog/announcements/shareholder-letter-q3fy25 and in the Investor Relations section of Atlassian's website at https://investors.atlassian.com.
Third Quarter Fiscal Year 2025 Earnings Results
"I am filled with immense pride as I reflect on Team '25 and our customers' and partners' reactions to our relentless focus on innovation," said Mike Cannon-Brookes, Atlassian's CEO and co-Founder. "Our long-term investments in building a world-class Cloud platform have enabled us to advance the Atlassian System of Work and bring Rovo's powerful AI capabilities to the center. Our vision for the future of human-AI collaboration is resonating deeply with customers, and we are more excited than ever to execute on our mission of unleashing the potential of every team."
"We delivered total revenue of $1.4 billion in the quarter, driven by Cloud revenue growth of 25% year-over-year," said Joe Binz, Atlassian's CFO. "We remain committed to balancing operational discipline with continued focused investment in key strategic areas like enterprise, AI, and the Atlassian System of Work to drive future growth."
Third Quarter Fiscal Year 2025 Financial Highlights:
On a GAAP basis, Atlassian reported:
Revenue: Total revenue was $1,356.7 million for the third quarter of fiscal year 2025, up 14% from $1,189.1 million for the third quarter of fiscal year 2024.
Operating Income (Loss) and Operating Margin: Operating loss was $12.5 million for the third quarter of fiscal year 2025, compared with operating income of $17.8 million for the third quarter of fiscal year 2024. Operating margin was (1%) for the third quarter of fiscal year 2025, compared with 1% for the third quarter of fiscal year 2024.
Net Income (Loss) and Net Income (Loss) Per Diluted Share: Net loss was $70.8 million for the third quarter of fiscal year 2025, compared with net income of $12.8 million for the third quarter of fiscal year 2024. Net loss per diluted share was $0.27 for the third quarter of fiscal year 2025, compared with net income per diluted share of $0.05 for the third quarter of fiscal year 2024.
Balance Sheet: Cash and cash equivalents plus marketable securities at the end of the third quarter of fiscal year 2025 totaled $3.0 billion.
On a non-GAAP basis, Atlassian reported:
Operating Income and Operating Margin: Operating income was $348.3 million for the third quarter of fiscal year 2025, compared with operating income of $316.5 million for the third quarter of fiscal year 2024. Operating margin was 26% for the third quarter of fiscal year 2025, compared with 27% for the third quarter of fiscal year 2024.
Net Income and Net Income Per Diluted Share: Net income was $261.5 million for the third quarter of fiscal year 2025, compared with net income of $232.5 million for the third quarter of fiscal year 2024. Net income per diluted share was $0.97 for the third quarter of fiscal year 2025, compared with net income per diluted share of $0.89 for the third quarter of fiscal year 2024.
Free Cash Flow: Cash flow from operations was $652.7 million and free cash flow was $638.3 million for the third quarter of fiscal year 2025. Free cash flow margin for the third quarter of fiscal year 2025 was 47%.
A reconciliation of GAAP to non-GAAP financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below, under the heading "About Non-GAAP Financial Measures."
Recent Business Highlights:
Atlassian Team '25: Thousands of customers and partners traveled to Anaheim to witness the latest product announcements and innovations including:
Rovo for All: Atlassian announced that its AI solution, Rovo, is now included in all premium and enterprise editions for Jira, Confluence, and Jira Service Management, with standard edition soon to follow. This move brings advanced AI-powered enterprise search, chat, and agents to the center of the Atlassian Platform.
Teamwork Collection: Atlassian announced Teamwork Collection, a curated selection of apps - Jira, Confluence, and Loom - alongside Rovo agents powered by the Atlassian Cloud Platform - that helps technical and business teams break down silos, use AI more effectively, and reduce context switching.
Strategy Collection: Atlassian announced Strategy Collection, an Enterprise Strategy and Planning solution that brings three apps - Focus, Talent, and Jira Align - together to provide leaders a clear view of the most important priorities and ensures their teams are driving towards the highest value outcomes.
Customer Service Management: Atlassian announced its Customer Service Management app, a new AI-powered app designed to connect support, product, development, and operations teams to deliver high-velocity customer service.
Expanded Cloud Offerings: Atlassian announced two new offerings: Government Cloud and Isolated Cloud. Atlassian achieved FedRAMP® authorization at the Moderate level for its Government Cloud to enable U.S. government agencies and their industry partners to take advantage of the capabilities of the Atlassian Cloud Platform. Atlassian also announced Isolated Cloud, an Atlassian-managed virtual private cloud option for organizations that need a dedicated cloud environment.
Learn more about these announcements at https://www.atlassian.com/blog/product-news.
Atlassian Williams Racing: Atlassian announced a long-term partnership to be the official title and technology partner of Williams Racing, a storied Formula 1 franchise. This partnership will bring Atlassian's AI-powered collaboration software to the track in front of customers and millions of fans, as it helps Williams Racing accelerate its digital transformation through the power of the Atlassian System of Work.
Customers with >$10,000 in Cloud ARR: Atlassian ended its third quarter of fiscal year 2025 with 50,715 customers with greater than $10,000 in Cloud annualized recurring revenue (Cloud ARR), an increase of 14% year-over-year.
Recognized on Fortune's List of 100 Best Companies to Work For® 2025: Atlassian was recognized, for the seventh consecutive year, as one of Fortune's 100 Best Companies to Work For®. This achievement reflects the commitment, dedication, and collaborative nature of all Atlassians who carry this remarkable culture.
Board of Directors Update: Atlassian appointed Karen Dykstra to its Board of Directors. Karen is the former Chief Financial Officer at VMware, Inc., AOL Inc., and Automatic Data Processing, Inc., and currently sits on the board of directors at Gartner Inc. and Arm Holdings PLC. Karen brings more than 30 years of financial leadership and strong operational experience across many diverse industries, which will be invaluable in supporting Atlassian as it continues to expand its enterprise capabilities.
Financial Targets:
Atlassian is providing its financial targets as follows:
Fourth Quarter Fiscal Year 2025:
Total revenue is expected to be in the range of $1,349 million to $1,359 million.
Cloud revenue growth year-over-year is expected to be approximately 23.0%.
Data Center revenue growth year-over-year is expected to be approximately 16.5%.
Marketplace and other revenue growth year-over-year is expected to be approximately flat.
Gross margin is expected to be approximately 82.5% on a GAAP basis and approximately 84.5% on a non-GAAP basis.
Operating margin is expected to be approximately (5.0%) on a GAAP basis and approximately 22.0% on a non-GAAP basis.
For additional commentary regarding financial targets, please see Atlassian's third quarter fiscal year 2025 shareholder letter dated May 1, 2025.
With respect to Atlassian's expectations under "Financial Targets" above, a reconciliation of GAAP to non-GAAP gross margin and operating margin has been provided in the financial statement tables included in this press release.
Shareholder Letter and Webcast Details:
A detailed shareholder letter is available on Atlassian's Work Life blog at https://atlassian.com/blog/announcements/shareholder-letter-q3fy25, and the Investor Relations section of Atlassian's website at https://investors.atlassian.com. Atlassian will host a webcast to answer questions today:
When: Thursday, May 1, 2025 at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time).
Webcast: A live webcast of the call can be accessed from the Investor Relations section of Atlassian's website at https://investors.atlassian.com. Following the call, a replay will be available on the same website.
Atlassian has used, and will continue to use, its Investor Relations website at https://investors.atlassian.com as a means of making material information public and for complying with its disclosure obligations.
About Atlassian
Atlassian unleashes the potential of every team. A recognized leader in software development, work management, and enterprise service management software, Atlassian enables enterprises to connect their business and technology teams with an AI-powered system of work that unlocks productivity at scale. Atlassian's collaboration software powers over 80% of the Fortune 500 and 300,000+ customers worldwide - including NASA, Rivian, Deutsche Bank, United Airlines, and Bosch - who rely on our solutions to drive work forward.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. In some cases, you can identify these statements by forward-looking words such as "may," "will," "expect," "believe," "anticipate," "intend," "could," "should," "estimate," "further," or "continue," and similar expressions or variations, but these words are not the exclusive means for identifying such statements. All statements other than statements of historical fact could be deemed forward looking, including but not limited to risks and uncertainties related to statements about our platform, offerings and planned offerings, investments, System of Work, AI solutions, customers, strategic partnerships, leadership transitions, strategic priorities, anticipated growth, outlook and results, and our financial targets such as total revenue, Cloud, Data Center, and Marketplace and other revenue, and GAAP and non-GAAP financial measures including gross margin and operating margin.
We undertake no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.
The achievement or success of the matters covered by such forward-looking statements involves known and unknown risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. You should not rely upon forward-looking statements as predictions of future events. Forward-looking statements represent our management's beliefs and assumptions only as of the date such statements are made.
Further information on these and other factors that could affect our financial results is included in filings we make with the Securities and Exchange Commission (the "SEC") from time to time, including the section titled "Risk Factors" in our most recently filed Forms 10-K and 10-Q. These documents are available on the SEC Filings section of the Investor Relations section of our website at https://investors.atlassian.com.
About Non-GAAP Financial Measures
In addition to the measures presented in our condensed consolidated financial statements, we regularly review other measures that are not presented in accordance with U.S. generally accepted accounting principles ("GAAP"), defined as non-GAAP financial measures by the SEC, to evaluate our business, measure our performance, identify trends, prepare financial forecasts and make strategic decisions. The key measures we consider are non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, non-GAAP net income per diluted share and free cash flow (collectively, the "Non-GAAP Financial Measures"). These Non-GAAP Financial Measures, which may be different from similarly titled non-GAAP measures used by other companies, provide supplemental information regarding our operating performance on a non-GAAP basis that excludes certain gains, losses and charges of a non-cash nature or that occur relatively infrequently and/or that management considers to be unrelated to our core operations. Management believes that tracking and presenting these Non-GAAP Financial Measures provides management, our board of directors, investors and the analyst community with the ability to better evaluate matters such as: our ongoing core operations, including comparisons between periods and against other companies in our industry; our ability to generate cash to service our debt and fund our operations; and the underlying business trends that are affecting our performance.
Our Non-GAAP Financial Measures include:
Non-GAAP gross profit and non-GAAP gross margin. Excludes expenses related to stock-based compensation and amortization of acquired intangible assets.
Non-GAAP operating income and non-GAAP operating margin. Excludes expenses related to stock-based compensation and amortization of acquired intangible assets.
Non-GAAP net income and non-GAAP net income per diluted share. Excludes expenses related to stock-based compensation, amortization of acquired intangible assets, gain on a non-cash sale of a controlling interest of a subsidiary and the related income tax adjustments.
Free cash flow. Free cash flow is defined as net cash provided by operating activities less capital expenditures, which consists of purchases of property and equipment.
We understand that although these Non-GAAP Financial Measures are frequently used by investors and the analyst community in their evaluation of our financial performance, these measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP. We compensate for such limitations by reconciling these Non-GAAP Financial Measures to the most comparable GAAP financial measures. We encourage you to review the tables in this press release titled "Reconciliation of GAAP to Non-GAAP Results" and "Reconciliation of GAAP to Non-GAAP Financial Targets" that present such reconciliations.
Customers with >$10,000 in Cloud ARR
We define the number of customers with Cloud ARR greater than $10,000 at the end of any particular period as the number of organizations with unique domains with an active Cloud subscription for two or more seats and greater than $10,000 in Cloud ARR.
We define Cloud ARR as the annualized recurring revenue run-rate of Cloud subscription agreements at a point in time. We calculate Cloud ARR by taking the Cloud monthly recurring revenue ("Cloud MRR") run-rate and multiplying it by 12. Cloud MRR for each month is calculated by aggregating monthly recurring revenue from committed contractual amounts at a point in time. Cloud ARR and Cloud MRR should be viewed independently of revenue and do not represent our revenue under GAAP, as they are operational metrics that can be affected by contract start and end dates and renewal rates.
Atlassian Corporation
Condensed Consolidated Statements of Operations
(U.S. $ and shares in thousands, except per share data)
(unaudited)
Three Months Ended March 31,
Nine Months Ended March 31,
2025
2024
2025
2024
Revenues:
Subscription
$
1,272,876
$
1,071,355
$
3,618,072
$
2,855,518
Other
83,840
117,773
212,888
371,495
Total revenues
1,356,716
1,189,128
3,830,960
3,227,013
Cost of revenues (1) (2)
219,675
213,425
660,426
585,990
Gross profit
1,137,041
975,703
3,170,534
2,641,023
Operating expenses:
Research and development (1) (2)
685,320
576,490
1,968,634
1,595,007
Marketing and sales (1) (2)
295,832
223,814
820,119
637,894
General and administrative (1)
168,345
157,595
483,694
458,249
Total operating expenses
1,149,497
957,899
3,272,447
2,691,150
Operating income (loss)
(12,456
)
17,804
(101,913
)
(50,127
)
Other expense, net
(14,861
)
(10,990
)
(42,292
)
(23,964
)
Interest income
27,767
21,414
81,917
69,233
Interest expense
(7,804
)
(8,453
)
(22,413
)
(26,430
)
Income (loss) before income taxes
(7,354
)
19,775
(84,701
)
(31,288
)
Provision for income taxes
(63,453
)
(7,023
)
(148,083
)
(72,312
)
Net income (loss)
$
(70,807
)
$
12,752
$
(232,784
)
$
(103,600
)
Net income (loss) per share attributable to Class A and Class B common stockholders:
Basic
$
(0.27
)
$
0.05
$
(0.89
)
$
(0.40
)
Diluted
$
(0.27
)
$
0.05
$
(0.89
)
$
(0.40
)
Weighted-average shares used in computing net income (loss) per share attributable to Class A and Class B common stockholders:
Basic
262,671
259,717
261,423
258,738
Diluted
262,671
261,778
261,423
258,738
(1) Amounts include stock-based compensation as follows:
Three Months Ended March 31,
Nine Months Ended March 31,
2025
2024
2025
2024
Cost of revenues
$
20,980
$
17,840
$
62,225
$
53,874
Research and development
240,847
190,322
694,570
528,587
Marketing and sales
43,071
33,383
122,323
103,832
General and administrative
41,944
40,974
132,600
121,652
(2) Amounts include amortization of acquired intangible assets, as follows:
Three Months Ended March 31,
Nine Months Ended March 31,
2025
2024
2025
2024
Cost of revenues
$
10,131
$
12,454
$
30,377
$
25,282
Research and development
94
94
281
281
Marketing and sales
3,672
3,646
11,017
8,723
Atlassian Corporation
Condensed Consolidated Balance Sheets
(U.S. $ in thousands)
(unaudited)
March 31, 2025
June 30, 2024
Assets
Current assets:
Cash and cash equivalents
$
2,660,859
$
2,176,930
Marketable securities
313,592
161,973
Accounts receivable, net
642,036
628,049
Prepaid expenses and other current assets
158,728
109,312
Total current assets
3,775,215
3,076,264
Non-current assets:
Property and equipment, net
93,003
86,315
Operating lease right-of-use assets
164,322
172,468
Strategic investments
217,304
223,221
Intangible assets, net
258,682
299,057
Goodwill
1,292,942
1,288,756
Deferred tax assets
5,515
3,934
Other non-current assets
76,733
62,118
Total assets
$
5,883,716
$
5,212,133
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable
$
192,915
$
177,545
Accrued expenses and other current liabilities
661,036
577,359
Deferred revenue, current portion
2,092,287
1,806,269
Operating lease liabilities, current portion
44,645
48,953
Total current liabilities
2,990,883
2,610,126
Non-current liabilities:
Deferred revenue, net of current portion
275,916
308,467
Operating lease liabilities, net of current portion
198,723
214,474
Long-term debt
987,232
985,911
Deferred tax liabilities
20,433
20,387
Other non-current liabilities
41,607
39,917
Total liabilities
4,514,794
4,179,282
Stockholders' equity
Common stock
3
3
Additional paid-in capital
5,223,786
4,212,064
Accumulated other comprehensive income (loss)
(26,355
)
25,300
Accumulated deficit
(3,828,512
)
(3,204,516
)
Total stockholders' equity
1,368,922
1,032,851
Total liabilities and stockholders' equity
$
5,883,716
$
5,212,133
Atlassian Corporation
Condensed Consolidated Statements of Cash Flows
(U.S. $ in thousands)
(unaudited)
Three Months Ended March 31,
Nine Months Ended March 31,
2025
2024
2025
2024
Cash flows from operating activities:
Net income (loss)
$
(70,807
)
$
12,752
$
(232,784
)
$
(103,600
)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization
23,178
23,464
69,154
55,560
Stock-based compensation
346,842
282,519
1,011,718
807,945
Deferred income taxes
1,746
3,207
(1,183
)
(98
)
Amortization of interest rate swap contracts
(6,337
)
—
(20,357
)
—
Net loss on strategic investments
6,643
4,060
24,546
11,750
Net foreign currency loss (gain)
(5,169
)
(2,276
)
(7,750
)
142
Other
(264
)
412
(241
)
(680
)
Changes in operating assets and liabilities, net of business combinations:
Accounts receivable, net
53,770
(119,819
)
(13,955
)
(166,494
)
Prepaid expenses and other assets
(294
)
(35,986
)
(65,967
)
(59,528
)
Accounts payable
(93
)
28,227
14,626
28,850
Accrued expenses and other liabilities
131,508
67,149
53,804
54,958
Deferred revenue
171,958
301,681
253,467
393,135
Net cash provided by operating activities
652,681
565,390
1,085,078
1,021,940
Cash flows from investing activities:
Business combinations, net of cash acquired
(994
)
—
(5,969
)
(844,727
)
Purchases of property and equipment
(14,366
)
(10,520
)
(29,853
)
(19,522
)
Purchases of strategic investments
(1,100
)
(4,250
)
(26,650
)
(8,250
)
Purchases of marketable securities
(116,716
)
(74,544
)
(277,039
)
(213,690
)
Proceeds from maturities of marketable securities
53,584
63,000
125,212
79,150
Proceeds from sales of marketable securities and strategic investments
2,622
—
6,935
61,392
Net cash used in investing activities
(76,970
)
(26,314
)
(207,364
)
(945,647
)
Cash flows from financing activities:
Principal payments of term loan facility
—
(12,500
)
—
(25,000
)
Repurchases of Class A Common Stock
(134,305
)
(35,377
)
(387,156
)
(203,029
)
Other
—
—
(3,143
)
—
Net cash used in financing activities
(134,305
)
(47,877
)
(390,299
)
(228,029
)
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash
1,783
(2,769
)
(3,709
)
(1,986
)
Net increase (decrease) in cash, cash equivalents, and restricted cash
443,189
488,430
483,706
(153,722
)
Cash, cash equivalents, and restricted cash at beginning of period
2,218,639
1,461,763
2,178,122
2,103,915
Cash, cash equivalents, and restricted cash at end of period
$
2,661,828
$
1,950,193
$
2,661,828
$
1,950,193
Atlassian Corporation
Revenues by Deployment Options
(U.S. $ in thousands)
(unaudited)
Three Months Ended March 31,
Nine Months Ended March 31,
2025
2024
2025
2024
Cloud
$
880,429
$
703,036
$
2,519,697
$
1,960,893
Data Center
388,516
364,134
1,086,391
881,835
Server
—
29,720
—
177,645
Marketplace and other (1)
87,771
92,238
224,872
206,640
Total revenues
$
1,356,716
$
1,189,128
$
3,830,960
$
3,227,013
(1) Included in Marketplace and other is premier support revenue. Premier support consists of subscription-based arrangements for a higher level of support across different deployment options. Premier support is recognized as Subscription revenue on the Condensed Consolidated Statements of Operations as the services are delivered over the term of the arrangement.
Atlassian Corporation
Reconciliation of GAAP to Non-GAAP Results
(U.S. $ and shares in thousands, except percentage and per share data)
(unaudited)
Three Months Ended March 31,
Nine Months Ended March 31,
2025
2024
2025
2024
Gross profit
GAAP gross profit
$
1,137,041
$
975,703
$
3,170,534
$
2,641,023
Plus: Stock-based compensation
20,980
17,840
62,225
53,874
Plus: Amortization of acquired intangible assets
10,131
12,454
30,377
25,282
Non-GAAP gross profit
$
1,168,152
$
1,005,997
$
3,263,136
$
2,720,179
Gross margin
GAAP gross margin
84
%
82
%
83
%
82
%
Plus: Stock-based compensation
2
2
2
1
Plus: Amortization of acquired intangible assets
—
1
—
1
Non-GAAP gross margin
86
%
85
%
85
%
84
%
Operating income
GAAP operating income (loss)
$
(12,456
)
$
17,804
$
(101,913
)
$
(50,127
)
Plus: Stock-based compensation
346,842
282,519
1,011,718
807,945
Plus: Amortization of acquired intangible assets
13,897
16,194
41,675
34,286
Non-GAAP operating income
$
348,283
$
316,517
$
951,480
$
792,104
Operating margin
GAAP operating margin
(1
%)
1
%
(3
%)
(2
%)
Plus: Stock-based compensation
26
25
27
26
Plus: Amortization of acquired intangible assets
1
1
1
1
Non-GAAP operating margin
26
%
27
%
25
%
25
%
Net income
GAAP net income (loss)
$
(70,807
)
$
12,752
$
(232,784
)
$
(103,600
)
Plus: Stock-based compensation
346,842
282,519
1,011,718
807,945
Plus: Amortization of acquired intangible assets
13,897
16,194
41,675
34,286
Less: Gain on a non-cash sale of a controlling interest of a subsidiary
—
—
—
(1,378
)
Less: Income tax adjustments (1)
(28,427
)
(78,969
)
(103,777
)
(146,271
)
Non-GAAP net income
$
261,505
$
232,496
$
716,832
$
590,982
Net income per share
GAAP net income (loss) per share - diluted
$
(0.27
)
$
0.05
$
(0.89
)
$
(0.40
)
Plus: Stock-based compensation
1.29
1.08
3.82
3.11
Plus: Amortization of acquired intangible assets
0.05
0.06
0.16
0.13
Less: Gain on a non-cash sale of a controlling interest of a subsidiary
—
—
—
(0.01
)
Less: Income tax adjustments (1)
(0.10
)
(0.30
)
(0.39
)
(0.56
)
Non-GAAP net income per share - diluted
$
0.97
$
0.89
$
2.70
$
2.27
Weighted-average diluted shares outstanding
Weighted-average shares used in computing diluted GAAP net income (loss) per share
262,671
261,778
261,423
258,738
Plus: Dilution from dilutive securities (2)
5,959
—
3,601
1,273
Weighted-average shares used in computing diluted non-GAAP net income per share
268,630
261,778
265,024
260,011
Free cash flow
GAAP net cash provided by operating activities
$
652,681
$
565,390
$
1,085,078
$
1,021,940
Less: Capital expenditures
(14,366
)
(10,520
)
(29,853
)
(19,522
)
Free cash flow
$
638,315
$
554,870
$
1,055,225
$
1,002,418
(1) We utilize a fixed long-term projected non-GAAP tax rate in our computation of the non-GAAP income tax adjustments in order to provide better consistency across interim reporting periods. In projecting this long-term non-GAAP tax rate, we utilized a three-year financial projection that excludes the direct and indirect income tax effects of the other non-GAAP adjustments reflected above. Additionally, we considered our current operating structure and other factors such as our existing tax positions in various jurisdictions and key legislation in major jurisdictions where we operate. For fiscal years 2025 and 2024, we determined the projected non-GAAP tax rate to be 26% and 27%, respectively. This fixed long-term projected non-GAAP tax rate eliminates the effects of non-recurring and period specific items which can vary in size and frequency. Examples of the non-recurring and period specific items include but are not limited to changes in the valuation allowance related to deferred tax assets, effects resulting from acquisitions, and unusual or infrequently occurring items. We will periodically re-evaluate this long-term rate, as necessary, for significant events. The rate could be subject to change for a variety of reasons, for example, significant changes in the geographic earnings mix or fundamental tax law changes in major jurisdictions where we operate.
(2) The effects of these dilutive securities were not included in the GAAP calculation of diluted net loss per share for the three and nine months ended March 31, 2025 and nine months ended March 31, 2024, because the effect would have been anti-dilutive.
Atlassian Corporation
Reconciliation of GAAP to Non-GAAP Financial Targets
Three Months Ending
June 30, 2025
GAAP gross margin
82.5%
Plus: Stock-based compensation
1.5
Plus: Amortization of acquired intangible assets
0.5
Non-GAAP gross margin
84.5%
GAAP operating margin
(5.0%)
Plus: Stock-based compensation
26.0
Plus: Amortization of acquired intangible assets
1.0
Non-GAAP operating margin
22.0%
View source version on businesswire.com: https://www.businesswire.com/news/home/20250501473152/en/
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Investor Relations Contact Martin LamIR@atlassian.com
Media Contact Marie-Claire Maplepress@atlassian.com
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Business Wire
an hour ago
- Business Wire
QIAGEN and Incyte Announce Precision Medicine Collaboration to Develop Companion Diagnostics for Patients With Mutant CALR-expressing Myeloproliferative Neoplasms (MPNs)
VENLO, Netherlands & WILMINGTON, Del.--(BUSINESS WIRE)--QIAGEN N.V. (NYSE: QGEN; Frankfurt Prime Standard: QIA) and Incyte (Nasdaq: INCY) today announced a new global collaboration to develop a novel diagnostic panel to support Incyte's extensive portfolio of investigational therapies for patients with myeloproliferative neoplasms (MPNs), a group of rare blood cancers, including Incyte's monoclonal antibody INCA033989, targeting mutant calreticulin (mutCALR), which is being developed in myelofibrosis (MF) and essential thrombocythemia (ET). Under the terms of the Master Collaboration Agreement with Incyte, QIAGEN will develop a multimodal panel using next-generation sequencing (NGS) technology for detecting clinically relevant gene alterations in hematological malignancies. The panel will be validated using the next-generation sequencing (NGS) technology and the Illumina NextSeq 550Dx platform as part of QIAGEN's partnership with Illumina (NASDAQ: ILMN) to leverage its NGS diagnostic platforms for patient testing by laboratories worldwide. QIAGEN will support regulatory submission processes and market access activities across the United States, European Union and Asia-Pacific regions. Myeloproliferative neoplasms are a group of diseases representing about 40% of hematological malignancies, characterized by chronic accumulation of different mature blood cell types in blood. Identifying genomic aberrations in clinically relevant biomarkers like CALR are shown to be key, especially in MPNs. Incyte is at the forefront of developing novel therapies, including INCA033989 for patients with mutCALR ET or MF, that target only malignant cells, sparing normal cells. The use of companion diagnostics helps guide clinicians in making treatment decisions that can lead to better patient outcomes. 'Following our presentation of positive, late-breaking data from our first-in-class mutCALR-targeted antibody at EHA, we are excited to announce this partnership with QIAGEN, which will facilitate CALR testing for patients with MPNs on a global basis. The development of companion diagnostics for mutCALR, coupled with the potential for new medicines to selectively target disease-initiating cells, is a critical step toward changing the course of disease in patients with ET and MF,' said Pablo J. Cagnoni, M.D., President and Head of Research and Development, Incyte. 'As a partner, QIAGEN has the proven expertise in companion diagnostics development and approvals needed to support our ongoing work and commitment to transforming the treatment of patients with CALR-mutant MPNs.' 'Together with Incyte we are building a multimodal companion diagnostic using a powerful technology like next-generation sequencing to facilitate highly accurate testing for several blood cancer genes at once,' said Jonathan Arnold, Vice President and Head of Partnering for Precision Diagnostics at QIAGEN. 'This new partnership strengthens our role in offering companion diagnostics for the growing number of biomarkers being discovered in onco-hematology and maximizing the clinical utility of the diagnostic for payor and patient benefit, thus supporting the work of innovative, science-driven companies like Incyte to improve patient outcomes.' About Mutations in Calreticulin (mutCALR) Calreticulin (CALR) is a protein involved in the regulation of cellular calcium levels and normal protein production. Somatic, or non-inherited, DNA mutations in the CALR gene (mutCALR) can result in abnormal protein function and lead to the development of myeloproliferative neoplasms (MPNs), i a closely related group of clonal blood cancers in which the bone marrow functions abnormally, overproducing blood cells. ii,iii Among the two types of MPNs, essential thrombocythemia (ET) and myelofibrosis (MF), mutCALR drives 25-35% of all cases. i,ii About QIAGEN QIAGEN N.V., a Netherlands-based holding company, is the leading global provider of Sample to Insight solutions, enabling customers to extract and gain valuable molecular insights from samples containing the building blocks of life. Our Sample technologies isolate and process DNA, RNA and proteins from blood, tissue and other materials. Assay technologies prepare these biomolecules for analysis while bioinformatics software and knowledge bases can be used to interpret data to find actionable insights. Automation solutions bring these processes together into seamless and cost-effective workflows. QIAGEN serves over 500,000 customers globally in Life Sciences (academia, pharma R&D and industrial applications, primarily forensics) and Molecular Diagnostics for clinical healthcare. As of March 31, 2025, QIAGEN employed approximately 5,700 people in over 35 locations worldwide. For more information, visit QIAGEN is a pioneer in precision medicine and the leader in collaborating with pharmaceutical and biotechnology companies to develop companion diagnostics, having more than 30 master collaboration agreements with global pharmaceutical and biotechnology companies to develop and commercialize diagnostic tests. QIAGEN's offering to these companies encompasses technologies ranging from polymerase chain reaction (PCR), near-patient testing and digital PCR (dPCR) to next-generation sequencing (NGS), and sample types from liquid biopsy to tissue. It also spans disease areas from cancer to non-oncology diseases such as neurodegenerative, inflammatory, and metabolic diseases – including 16 FDA-approved PCR-based companion diagnostics. For more information about QIAGEN's efforts in precision medicine please visit About Incyte A global biopharmaceutical company on a mission to Solve On., Incyte follows the science to find solutions for patients with unmet medical needs. Through the discovery, development and commercialization of proprietary therapeutics, Incyte has established a portfolio of first-in-class medicines for patients and a strong pipeline of products in Oncology and Inflammation & Autoimmunity. Headquartered in Wilmington, Delaware, Incyte has operations in North America, Europe and Asia. For additional information on Incyte, please visit or follow us on social media: LinkedIn, X, Instagram, Facebook, YouTube. QIAGEN Forward-Looking Statement Certain statements in this press release may constitute forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. These statements, including those regarding QIAGEN's products, development timelines, marketing and / or regulatory approvals, financial and operational outlook, growth strategies, collaborations and operating results - such as expected adjusted net sales and adjusted diluted earnings - are based on current expectations and assumptions. However, they involve uncertainties and risks. These risks include, but are not limited to, challenges in managing growth and international operations (including the effects of currency fluctuations, regulatory processes and logistical dependencies), variability in operating results, commercial development for our products to customers in the Life Sciences and clinical healthcare, changes in relationships with customers, suppliers or strategic partners; competition and rapid technological advancements; fluctuating demand for QIAGEN's products due to factors such as economic conditions, customer budgets and funding cycles; obtaining and maintaining regulatory approvals for our products; difficulties in successfully adapting QIAGEN's products into integrated solutions and producing these products; and protecting product differentiation from competitors. Additional uncertainties may arise from market acceptance of new products, integration of acquisitions, governmental actions, global or regional economic developments, natural disasters, political or public health crises, and other "force majeure" events. There is also no guarantee that anticipated benefits from restructuring programs and acquisitions will materialize as expected. For a comprehensive overview of risks, please refer to the 'Risk Factors' contained in our most recent Annual Report on Form 20-F and other reports filed with or furnished to the U.S. Securities and Exchange Commission. Incyte Forward-Looking Statements Except for the historical information set forth herein, the matters set forth in this press release, including statements regarding the potential for Incyte's mut-CALR targeted antibody (INCA033989) to provide a potential treatment option for patients with ET or MF, contain predictions, estimates and other forward-looking statements. These forward-looking statements are based on Incyte's current expectations and subject to risks and uncertainties that may cause actual results to differ materially, including unanticipated developments in and risks related to: unanticipated delays; further research and development and the results of clinical trials possibly being unsuccessful or insufficient to meet applicable regulatory standards or warrant continued development; the ability to enroll sufficient numbers of subjects in clinical trials; determinations made by the FDA, EMA, and other regulatory authorities; the efficacy or safety of Incyte and its partners' products; the acceptance of Incyte and its partners' products in the marketplace; market competition; sales, marketing, manufacturing and distribution requirements; and other risks detailed from time to time in our reports filed with the U.S. Securities and Exchange Commission, including our annual report on Form 10-K and our quarterly report on Form 10-Q for the quarter ended March 31, 2025. Incyte disclaims any intent or obligation to update these forward-looking statements. Source: QIAGEN N.V. Category: Precision Medicine
Business Wire
2 hours ago
- Business Wire
Positive Late-Breaking Data for Incyte's First-in-Class mutCALR-targeted therapy INCA033989 in Essential Thrombocythemia Presented at EHA2025
WILMINGTON, Del.--(BUSINESS WIRE)--Incyte (Nasdaq:INCY) today announced the first clinical data from two studies evaluating the safety, tolerability and efficacy of INCA033989, a novel, first in class, Incyte-discovered, targeted monoclonal antibody in patients with mutant calreticulin (mutCALR)-expressing myeloproliferative neoplasms (MPNs). These data – featured today in the Late-Breaking Oral Session (#LB4002) at the European Hematology Association 2025 (EHA2025) Congress in Milan, Italy – focus on the dose escalation portion of the studies in patients with high risk essential thrombocythemia (ET) who are resistant/intolerant to prior cytoreductive therapy. 'These findings, and the further development of INCA033989, offer the potential to significantly transform the treatment of patients with CALR-mutant MPNs," said Pablo J. Cagnoni, M.D., President, Head of Research and Development, Incyte. Share The studies evaluated the safety and efficacy of INCA033989 in patients with ET as measured by hematologic response and reduction in mutCALR variant allele frequency (VAF). Results as of April 4, 2025, showed rapid and durable normalization of platelet counts across all dose levels, with a trend toward improved responses in higher doses (>400 mg), in patients with ET treated with INCA033989. Notably, 86% of patients at doses 400 mg and above achieved a complete or partial hematologic response, with the majority (82%) of patients achieving complete response. Eighty-nine (89) percent of evaluable patients (34/38) showed a reduction in mutCALR VAF from baseline. A partial molecular response (>50% VAF reduction) was observed in 21% of evaluable patients (8/38) after only 3 cycles of treatment. An exploratory study using single-cell DNA (scDNA) sequencing showed that INCA033989 directly targets and reduces cells carrying mutCALR. This reduction was seen in early blood-forming (CD34-positive) cells and cells in the myeloid-erythroid (ME) lineage. At the same time, there was a clear increase in healthy (wild-type CALR) cells, suggesting that the treatment supports the return of normal blood production. Bone marrow biopsies further confirmed these effects showing fewer megakaryocytes with mutCALR protein and a notable increase in megakaryocytes without mutCALR protein. Together, these findings demonstrate the selectivity of INCA033989, allowing for normalization of healthy hematopoiesis and disease modification. 'The late-breaking data presented today highlight the impact of INCA033989, a novel agent that selectively targets mutant CALR, to inhibit and eliminate cancer-causing cells in patients with essential thrombocythemia (ET), while sparing healthy cells and normalizing healthy blood production," said Pablo J. Cagnoni, M.D., President, Head of Research and Development, Incyte. 'These findings, and the further development of INCA033989, offer the potential to significantly transform the treatment of patients with CALR-mutant myeloproliferative neoplasms (MPNs).' The results (N=49) showed that INCA033989 was well tolerated across all dose cohorts (24 to 2,500 mg), with no dose-limiting toxicities observed. Only one (1) patient discontinued treatment, and only one (1) dose reduction due to treatment-emergent adverse events (TEAEs) was observed. No infusion interruptions due to TEAEs were reported, and a maximum tolerated dose was not reached. Forty-two (42) patients across the dose cohorts reported a TEAE. The most common TEAEs were fatigue (26.5%) and upper respiratory tract infection (20.4%), all of which were Grade ≤2. Thirteen (13) patients had Grade >3 TEAEs, with transient asymptomatic lipase increase as the most common (6%). 'mutCALR is the second most common oncogenic driver of MPNs, yet the therapeutic landscape lacks a targeted agent for mutCALR expressing MPNs. Currently, ET treatments aim to prevent vascular complications and improve symptoms but are limited by toxicity and tolerability issues,' said John Mascarenhas, M.D., Professor of Medicine at the Icahn School of Medicine at Mt. Sinai and Director, Center of Excellence for Blood Cancers and Myeloid Disorders, The Tisch Cancer Institute. 'These data support the hypothesis that INCA033989 has the potential not only to normalize platelet counts and provide rapid and durable hematologic responses – but to induce molecular responses, which could potentially change the natural history of the disease.' Additional data from the INCA033989 study in patients with myelofibrosis will be submitted for presentation at a future medical meeting. Discussions with regulatory authorities are planned with the goal to initiate a Phase 3 study by early 2026. More information regarding the EHA2025 Congress and the data from Incyte's hematology/oncology portfolio being featured at the meeting can be found on the EHA website: Incyte Conference Call and Webcast Incyte will host an in-person analyst and investor event on Sunday, June 15, 2025, from 6:00 - 7:30 a.m. ET (12:00 - 1:30 p.m. CEST) to discuss key mutCALR data presented at EHA. The event will be webcasted and can be accessed via the Events and Presentations tab of the Investor section of and it will be available for replay for 30 days. About Myeloproliferative Neoplasms Myeloproliferative neoplasms (MPNs) are a closely related group of blood cancers in which the bone marrow functions abnormally. The bone marrow is where the body's blood cells are made. MPNs are progressive blood cancers that can strike anyone at any age, but they are more common in older adults. Estimates of the prevalence of MPNs vary, but analysis of claims data suggests there may be as many as 200,000 people in the U.S. living with the most prevalent MPNs: myelofibrosis, polycythemia vera or essential thrombocythemia (ET). 1 About Mutations in Calreticulin (mutCALR) Calreticulin (CALR) is a protein involved in the regulation of cellular calcium levels and normal protein folding. Somatic, or non-inherited, DNA mutations in the CALR gene (mutCALR) can result in abnormal protein function and lead to the development of myeloproliferative neoplasms (MPNs), 2 a closely related group of clonal blood cancers in which the bone marrow functions abnormally, overproducing blood cells. 3,4 Among two types of MPNs, essential thrombocythemia (ET) and myelofibrosis (MF), mutCALR drives 25-35% of all cases. 2,3 There are approximately 60,000 patients in the U.S. and Europe with mutCALR positive ET. 5 Incyte is at the forefront of developing novel therapies for patients with mutCALR ET or MF that target only malignant cells, sparing normal cells, including INCA033989, a first-in-class, mutCALR-specific therapy. About the INCA033989 Trial Program The clinical trial program for INCA033989 includes two multicenter, open-label Phase 1 studies, INCA33989-101 (NCT05936359) and INCA33989-102 (NCT06034002), enrolling ~225 patients outside of the U.S. and ~140 patients in the U.S., respectively. The studies are evaluating the safety, tolerability, dose-limiting toxicity (DLT) and maximum tolerated dose (MTD) and/or recommended dose(s) for expansion (RDE) of INCA033989 administered as a monotherapy or in combination with ruxolitinib in patients with myeloproliferative neoplasms (MPNs), including essential thrombocythemia (ET) and myelofibrosis (MF). The intent of Part 1A (dose escalation) is to identify the MTD and/or the RDE of INCA033989 among patients with MF and ET. In Part 1A INCA033989 is administered intravenously every two weeks at a protocol defined dose ranging from 24 mg. to 2,500 mg. In Part 1B (dose expansion), INCA033989 is administered at the RDE(s) identified during Part 1A. The primary endpoint of the studies focuses on safety and tolerability as measured by: the number of participants with DLTs up to 28 days, the number of participants with treatment-emergent adverse events (TEAEs) up to 3 years and 60 days, and the number of participants with TEAEs leading to dose modification or discontinuation up to 3 years and 60 days. Secondary endpoints include response rates, mean change of ET total symptom score from baseline, percentage of MF patients achieving spleen volume reduction, MF patient anemia response, mean change in disease-related allele burden and various pharmacokinetics measures up to 3 years and 60 days. For more information on the study, please visit: and About Incyte A global biopharmaceutical company on a mission to Solve On., Incyte follows the science to find solutions for patients with unmet medical needs. Through the discovery, development and commercialization of proprietary therapeutics, Incyte has established a portfolio of first-in-class medicines for patients and a strong pipeline of products in Oncology and Inflammation & Autoimmunity. Headquartered in Wilmington, Delaware, Incyte has operations in North America, Europe and Asia. For additional information on Incyte, please visit or follow us on social media: LinkedIn, X, Instagram, Facebook, YouTube. Forward-Looking Statements Except for the historical information set forth herein, the matters set forth in this press release, including statements regarding the presentation of data for Incyte's anti-mutCALR monoclonal antibody (INCA033989), the potential this monoclonal antibody offers for patients, and expectations regarding ongoing and future clinical trials contain predictions, estimates, and other forward-looking statements. These forward-looking statements are based on Incyte's current expectations and subject to risks and uncertainties that may cause actual results to differ materially, including unanticipated developments in and risks related to: further research and development and the results of clinical trials possibly being unsuccessful or insufficient to meet applicable regulatory standards or warrant continued development; the ability to enroll sufficient numbers of subjects in clinical trials and the ability to enroll subjects in accordance with planned schedules; determinations made by the FDA, EMA and other regulatory agencies; Incyte's dependence on its relationships with and changes in the plans of its collaboration partners; the efficacy or safety of Incyte's products and the products of Incyte's collaboration partners; the acceptance of Incyte's products and the products of Incyte's collaboration partners in the marketplace; market competition; unexpected variations in the demand for Incyte's products and the products of Incyte's collaboration partners; the effects of announced or unexpected price regulation or limitations on reimbursement or coverage for Incyte's products and the products of Incyte's collaboration partners; sales, marketing, manufacturing and distribution requirements, including Incyte's and its collaboration partners' ability to successfully commercialize and build commercial infrastructure for newly approved products and any additional products that become approved; greater than expected expenses, including expenses relating to litigation or strategic activities; variations in foreign currency exchange rates; and other risks detailed in Incyte's reports filed with the Securities and Exchange Commission, including its annual report on form 10-K and our quarterly report on Form 10-Q for the quarter ended March 31, 2025. Incyte disclaims any intent or obligation to update these forward-looking statements.
Yahoo
2 hours ago
- Yahoo
The rich are fleeing Labour's Britain. We could all pay the price
For over a century, Britain has been a hub for wealthy expats escaping political tumult, oppression or simply seeking better opportunities. From the 'White Russians' fleeing the Bolshevik revolution to wealthy Chinese seeking a safe haven for their capital in the 2010s, the UK was a magnet for the rich. Now, though, the flows may be reversing. After Labour's move to scrap non-dom status and overhaul inheritance tax, there are growing signs that the 1pc may be fleeing. 'I'm still here, counting the days I'm allowed to stay, waiting for a miracle, which is not going to happen,' says 55-year-old Magda Wierzycka, who has lived in Britain for half a decade. Wierzycka fled Poland as a refugee under communism in the early 1980s before settling in South Africa, where she made millions. In 2019 she moved to the UK to start a venture capital business. 'We brought in about £500m and invested it in British innovation. Five years in, I effectively get told 'We don't need your money, and we don't want you in the country'.' Wierzycka, who was a non-dom until the status was abolished, can now only stay in Britain for 91 days a year before incurring tax on her global earnings and gains, with a lower limit on how many days she can work. As a result, she is reluctantly planning to return to South Africa. Reeves's decision to raise taxes on people like Wierzycka was a calculated gamble. The Chancellor hopes that most of the rich will choose to stay in Britain and pay higher taxes, boosting public coffers by £5bn a year. The money will help pay for free breakfast clubs for children and plug gaps in stretched public finances. Yet the list of wealthy emigres has been growing steadily since tax changes took effect April. It includes people like South African national Richard Gnodde, Goldman Sachs' best paid banker outside the US, Aston Villa co-owner Nassef Sawiris and steel magnate Lakshmi Mittal. Those are the names we know of. How many others are leaving? 'We really don't know anything at this stage,' says Arun Advani, an associate professor of economics at the University of Warwick. 'The only way to know about what non-doms are doing is to look at the tax data. The data for the last tax year that ended in April, people don't even file those taxes until January of next year. 'Late filing is particularly prevalent at the top of the income distribution, where the £100 late fee is not really that costly. We don't really get that information here until, in I guess, 18 months.' It will be a nervous wait for the Chancellor. If 25pc of non-doms quit the UK, the Treasury would make no extra money from scrapping the tax status. If a third left, the UK would lose £700m in the first year of the policy, according to the Centre for Economics and Business Research (CEBR). 'I love this country,' says entrepreneur Bassim Haidar, who was born in Nigeria but has Lebanese citizenship. 'We really integrated. We've made amazing friends.' He left before the changes took effect on April 6 and now splits his time between the United Arab Emirates, Greece and Italy. 'Just like we adapted here, we will adapt somewhere else.' Predicting an exodus of the wealthy has often been a case of the boy who cried wolf. Yet several studies suggest something big may actually be under way this time. Even before Labour took power, Swiss bank UBS said the UK was on track to see the biggest departure of dollar-millionaires out of a group of 56 countries by 2028. Henley & Partners, which makes money from helping the world's wealthy move around, claimed Britain saw a record exodus of almost 11,000 millionaires last year. Some of its data was based on flimsy metrics like the locations people list on their LinkedIn profiles, however. The most robust analysis so far has come from Bloomberg, which found a surge in the number of directors moving abroad after analysing 5m company filings. Around 4,400 directors reported an overseas move in the last year, it said. The figure likely includes non-doms and British nationals moving in protest over recent tax changes. This includes stripping away inheritance tax business relief, a policy that could potentially force the sale of family businesses to pay tax bills. The changes also abolished the more than 200-year-old non-dom status in April, replacing it with a residence-based regime. This grants well-heeled newcomers four years of reprieve from being taxed on their foreign income and gains. However, in a major change, anything you own anywhere in the world – like a stake in your family business – becomes subject to UK inheritance tax after this period, and for up to 10 years after you leave. Non-doms have been a target for the taxman for a while. Jeremy Hunt, the former chancellor, cut back on the tax breaks in April last year before Reeves scrapped the relief altogether. Many non-doms say this was their tipping point. One describes it thus: 'It's like boiling a frog, except in this case the frog can jump out of the water.' There were 68,900 non-doms living in Britain in the 2022 tax year, the latest HMRC data shows. They are typically employed in lucrative professions and are highly mobile. You would expect a high share to leave in any given year, which can make it difficult to discern genuine trends without hard evidence. One place to look for clues is in London's most well-heeled neighbourhoods. At private members' club Walbrook, in the City of London, between 20 and 50 clients have cancelled their memberships as a result of the tax changes. 'The exodus actually began last year,' says managing director Philip Palumbo. 'The City seems to lack confidence, purpose. It feels over-taxed, over-regulated, and we are haemorrhaging good people to artificial places like Dubai, which is just so unacceptable.' Wealth advisers tell clients that memberships, including for gyms and private clubs, can be used by the taxman to prove residency. As a result, other clubs have resorted to offering shorter-term options of up to 90 days, news reports suggest. It is not just clubland that is suffering. 'Very definitely, there's a reduction of customers – certainly customers from the Arab countries who had residences in London. They come here [in] far fewer [numbers] now,' says Brian Lishak, the 86-year-old co-founder of Savile Row tailor, Richard Anderson. There has also been a drop in demand for butlers and nannies, according to Joshua James from Super Private Staff. His firm helps source household staff for the very rich. 'We have observed a notable decline in the high-end household recruitment market in London. It's clear that opportunities are shifting. Strong demand is emerging in regions like the Middle East, Monaco, and America.' A surprising side effect of Reeves's tax changes may well be an exodus of Britain's finest butlers and nannies. 'It is worth saying, the appeal of a butler or nanny with a British accent remains attractive internationally,' James adds. Buyers of London's poshest houses in areas like Mayfair, Knightsbridge and St John's Wood are seeing financial crisis-level discounts, according to Savills. Prime central London prices are a fifth lower than at their peak in June 2014. The estate agent blamed the non-dom tax changes and stamp duty hikes. Interior designer Phillippa Thorp has witnessed several non-dom customers leave. 'Businesses like ours have survived on rich bankers and rich people coming here from all over the world. They've had their families here for 20 years, they would never have left but for this mad own-goal,' she laments. Thorp fears the skilled tradespeople she relies on such as painters and bronze workers will struggle to get by as a result. 'We're losing them and we're losing their skills, and they will never come back. It's desperate, the situation. There are an awful lot of people who don't know what to do. Should we let some people go? Do we pray that the Government is going to do something right for once? It just seems like one disaster after another,' she says. 'I can safely say it just gets worse. If I was a young me, I would never, ever start a business here.' Thorp's case underscores the broader risks from the tax crackdown. Few of Labour's voters will shed a tear if the super-rich decamp to Monaco or Dubai. But the exodus has a broader economic impact. It is measured in fewer pounds spent in Michelin-starred restaurants, fewer donations to galleries to support blockbuster exhibitions or wings, and fewer people employed to help and serve the wealthy, among other things. 'I had 16 staff [in the UK] – drivers, property managers, and so on,' says Haidar, the Nigerian-born Lebanese businessman. 'I'm down to two now. These guys have lost their jobs.' Just how big the eventual economic impact is depends on how many of the wealthiest choose to leave. 'It would be safe to say that a large number have left, full stop,' says Simon Gibb, a partner in the London private wealth team of Trowers & Hamlins. 'That is largely to do with the removal of trust protections both for income and capital gains tax, but ultimately inheritance tax was very much a deal-breaker.' Non-doms have traditionally sheltered income earned from foreign businesses by placing it in a trust abroad. However, such trusts will now be subject to a British inheritance tax bill of 6pc every 10 years after they die as long as it exists. Those inheriting the business may have to sell chunks of it to pay the tax bill, Gibb says. Many are more concerned about the tax rates in death rather than in life. The UK's loss is other countries' gain. Britons were the second biggest foreign buyers of property in Dubai last year. Philippe Amarante, managing partner at Henley & Partners Middle East, says the United Arab Emirates is welcoming the wealthy with open arms. 'It's pro-migration. It can take you five days or two days even to come to Dubai and set up the company. It will take you a few days, a few weeks, to set up local domestic bank accounts and get you going,' he says. Parents who in the past came to Britain to put their children through school are now going to Dubai, he says. 'The clients that we have are saying 'you don't have knife crime, right? You don't have fist fights in the school courtyards'. The UK – particularly with crime and other elements – maybe the overall proposition has somewhat decreased.' Andrew Griffith, the shadow business secretary, says: 'It is a crisis of the Government's making. If [Reeves] would reverse the provisions about bringing global assets within UK inheritance tax, this flight from the UK would end tomorrow.' The issue is rapidly rising up the political agenda. Richard Tice, a Reform MP and the party's deputy leader, warns that Britain is 'seeing the greatest brain drain and wealth drain in my adult lifetime'. 'Every day of the week, I hear people say 'my friends are leaving,'' he says. 'It's truly terrifying. All these ludicrous people from the Left thinking the solution to our problems is to have a wealth tax. There won't be any wealth left in the country. It's a mobile world. This is a battle royale of hearts and minds.' Reform, which is currently polling as Britain's most popular party, has pledged to reverse the non-dom changes and scrap inheritance tax completely. The promise would leave a shortfall just shy of £20bn in public finances by the end of the decade, which Tice says would be filled 'by scrapping stupid net zero' amongst other things. The Treasury always expected people to leave in response to the non-dom and inheritance tax changes. The problems arise if more people go than expected. When Reeves announced her changes in October's Budget, the Office for Budget Responsibility (OBR) said the measures would raise £5.2bn a year by the end of the decade. This reflects only the direct tax take, not wider impacts on investment, staff and businesses relying on these very wealthy individuals. The fiscal watchdog assumed that 12pc of non-doms without trusts and 25pc with trusts would go. However, the OBR warned that predicting behavioural responses was difficult. Reeves has softened some measures slightly since October after a backlash from the wealthy, but the OBR said the tweaks did 'not materially affect' its forecasts. Britain relies more on high earners than many other countries, with the top 1pc paying 28pc of all income tax. If you broaden it to the top 10pc, the figure rises to 60pc of receipts. The Chancellor risks getting no revenues at all from the policy if more than 25pc of non-dom taxpayers leave, according to analysis by the Centre for Economics and Business Research. If as many as half relocate, Reeves could end up with a black hole of £12.2bn a year by the end of the decade in a worst-case scenario, the CEBR said. Chris Walker, a former Treasury economist, recently published a study suggesting 10pc of non-doms had already left by the end of last year, though it was based in part on the Henley & Partners analysis focused on LinkedIn. Regardless, Walker says: 'I think the OBR and the Government have underestimated the behavioural response. My gut instinct is that the Government probably won't lose money. But I would be surprised if it got even half of the £34bn it's projecting over five years. It's either going to be tax rises or spending cuts or a combination of the two to fill any gap that arises.' Advani, the economist, is less concerned about a wealth exodus. He believes there will be an initial spike and then the departures will tail off. Other people will also come in their place under the four-year regime, he expects. But he warns: 'It seems to me completely crazy that we've designed a regime that will continue to be a huge discouragement from people investing in the UK. That seems like a really big mistake.' Anyone betting on another Labour about-turn on the issue is likely to be disappointed. Those on the Left argue that the exodus of the wealthy is simply fabricated. 'All I can say is I don't see that,' says Stephen Kinsella, who describes himself as a 'patriotic millionaire'. 'I have lots of friends who have more money than I do. The people I talk to have got serious money. Most of them have their kids at school here, their family is here, and they just like the life and the culture and everything else this country offers you.' Kinsella is part of a lobbying group of wealthy individuals pushing for a 2pc wealth tax on anyone with more than £10m of assets to help repair Britain's crumbling state. People who claim there is a wealth exodus 'have such a vested interest', he argues. 'Who's more credible – them or us? I'm someone who says 'tax me more'. It would make no sense for me to do that if I genuinely believe that a lot of wealthy people would leave and therefore the UK tax take would go down. 'The wealth management companies have an interest in talking this up and talking up interest in their services. I'm not saying that being cynical, but it's obvious this narrative suits them.' Alex Cobham, the chief executive of Tax Justice, claims the whole notion of a wealth exodus has simply been whipped up the media and others who benefit from it. 'Anyone who says that they can tell you anything definitive about that is either kidding themselves or they're not being straight with you,' he says. 'Where did the spin come from that took these really thin and questionable numbers and turned them into this kind of headline news of 30 stories every day throughout 2024?' Cobham claims there is 'solid evidence' that tax changes generally lead to only small waves of migration among millionaires. 'Everybody's starting point should be that there isn't a significant concern here,' Cobham says. Regardless, lobbying groups are still trying to convince the Government to backtrack on some of the changes. Leslie MacLeod-Miller, founder of Foreign Investors for Britain, says: 'It's not just tax revenues, even though the non-doms contribute approximately £9bn per year in tax. Some families were spending between £20m and £40m a year on their services. Those go to cleaners, shopping, restaurants or hairdressers. The golden geese are leaving. I want to try and keep them here.' Some non-doms are stubbornly holding out hope too, but optimism is fading. Wierzycka is still hoping 'that some reason prevails'. She is sad to leave. So are many others. 'I think the UK is one of the greatest countries on the face of the planet,' says one wealthy foreigner who is reluctantly headed to Dubai with his family. 'I have a huge affinity for this place, and I'm leaving because the financial impact on our family is so substantial.' The true cost of such decisions may only become clear when it is too late. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
