So, like a lot of the tech industry this is simply a case of overhiring, overspending and general mismanagement. And like every other layoff announcement “AI” is a convenient scapegoat to hide executive dysfunction.
You'll find it much more interesting to look at metrics like free cashflow, which is a better indicator as to whether the company is generating more cash during operations than it spends. This is a lot closer to the layman's idea of profit, and in a small business like a restaurant or single store it's often analogous to profit. In publicly traded companies, net profit and loss are borderline meaningless.
Software companies hid behind “free cash flow” and “YoY revenue growth” and “non-GAAP profit” for years in the zero interest world. Now that the heat has turned up a notch investors can see what I said before - most of these companies are wildly overstaffed and addicted to spending.
Agree with the above general assessment that this is a company doing layoffs to address years of bad decisions and underperformance, and the broader issue of SaaS valuations as folks question valuations there. Just another case of “AI” as a PR puff excuse to avoid simply admitting this is about correcting prior bad management decisions.
The reason Atlassian doesn't "declare a profit" is that they are not profitable - they pay a lot with SBC, thus diluting shareholders year after year and not returning anything.
What's frustrating is that the company was profitable from its second year, and a really good little money maker too. I was working there at the time and I was proud to be working at one of the few tech companies actually turning a profit. Then IPO came, then literally overnight we switched gears and "reinvested every dollar into growth" and decided we'd just be another dumb money losing tech company.
If they have really been unprofitable for the last decade that is very sad.
https://community.atlassian.com/forums/Jira-questions/How-to...
could an AI native competitor eventually eat their lunch? sure. but "no new sane company wants to use their products" is a stretch when their customer count is literally still growing double digits.
i would not say "writing on the wall" at all.
Long time user here, Why do you think it is neglected?
I can't wait for Atlassian physical sticky-notes to take over.
[Edit: grammo and formatting]
The real problem is that company decisions will never be made as fast as software can be written (and rewritten) now.
No, the opposite; it is predicated on software being cheap and easy to ship, but hard to correctly anticipate the needs for.
> It might not make sense to continue (waterfall might be better actually)
Waterfall, not agile, is predicated on software being difficult to ship/expensive.
Software is still "difficult to ship/expensive". Code is very cheap now. Any kind of non-slop software is still expensive.
If Sheets works (I love simplicity) then I'll give it a go but I checked and I can't find any templates for Kanban or such.
My specialty is software requirements and my team was brought in to do the product management. The developers had read somewhere if you were using a database to do requirements then you were doing agile wrong.
They wanted me to write post it notes in triplicate, then fedex them to all their offices.
I think these companies should be pivoting to something where tasks/issues are the places you write the prompts for the AI, or augment the prompts that devs use. It's a big shift though.
Imagine you own a company that is paid to deliver packages. You use horses and differentiate by delivering quicker than everyone else.
Then cars are invented and everyone starts delivering packages faster.
In what world does a healthy growing business react to this by laying off couriers "in a pivot to automotive transportation".
Would a healthy business not switch everyone to driving cars and deliver even more packages?
That's because these layoffs aren't about AI. They're about firms that overhired and Wall St is (finally) having a sobering moment of their (profit) growth potential.
How long does a "sobering moment" last? Two years? Five? Ten?
They are betting that their AI business will be profitable, and need to cut costs to invest in it.
It could be. The idea that a business built on this framework won't immediately be picked apart by every competitor under the sun is entirely beyond me.
> and need to cut costs to invest in it.
If I'm right then this is just slashing your own throat so you can be the first to the bottom.
I think AI is a wonderful excuse for many. You can now lay off as many people as you want without standing out in a negative way. "Everyone is doing it" and "everyone knows why it's happening".
a.k.a the real reason for the layoffs. The underlying business is stagnant and unable to take advantage of the additional resources.
Strong businesses aim to grow revenue. Struggling businesses aim to cut costs.
Millions of horses got shipped to the glue factory. And many more farriers and stablemasters got laid off.
The Java products are almost EOL.
They have already been assigning JAC tickets to Rovo and $TEAM is down.
What else should be done with the surplus headcount?
Layoffs have little to do with AI, and more akin to fuel being jettisoned to stay in the air longer.
Not unless there were more packages to deliver.
Now, cars come along. With the new efficiencies, you find that now a courier takes only 6 hours to do their route. The number of buildings in the city has not increased, there's a cap to how much service you need to provide after which there's no longer any additional benefits. So, do you cut everyone's work day to 6 hours, or do you fire 25% of all couriers and re-route the rest so they now do 8 hour days on longer routes using cars?
Your solution assumes that the extra workforce immediately translates into free growth, but the growth of many businesses is constrained by outside factors. Here it would be the population of your served area.
Why? What was wrong with the 1600 people they sacked? Do they have a magical 1600-person hire pool with the AI skills they want?
Iow, humans are the horses in this analogy.
Horses/cars improve productivity. AI reduces payroll costs. That's the whole game here.
In other words, the business is not doing well
So 80 horse riders are out. You can't scale linearly, market is not supply bound usually, it's demand bound.
Some of the firms, Apple being the exception, doubled or even almost tripled in size.
I'm sure AI is partly to blame here but I think a lot of it is over hiring and firms just getting bogged down in bureaucracy and trying to clear things out.
You need people driving AI to get the benefits.
Its like a courier service that uses horses firing people once cars are invented because cars are faster than horses. You would switch everyone from horses to cars and deliver more packages.
If your postal service services a population of a million people and it takes 1000 horses to do that easily, but it takes 500 cars, you don't have a need for those 500 extra people.
You can't deliver more packages if the packages aren't there to be delivered. Your product demand doesn't just magically scale up once supply meets it.
which may actually be the problem. I suspect that there is actually some ideal ratio that could be calculated of Input Fields / Dev, LoC / Devs, or maybe Unique Pages / Dev, or some mix of all of the above. Some of the metrics I hear out of places like airbnb absolutely blow my mind (>5000 engineers! wtaf are they all doing?!?). I can sort of see the #s at google, MS making sense given the breadth of the problems they are solving, but other places, not so much.
Dev users assume the only problem a product can solve is performance, when there is a lot more than that in reality.
Okay I just wrote an "it's not, it's..." organically, is this the zeitgeist or what.
The em-dash observation makes sense. Obviously a minority of people reach for an actual em-dash. The "it's not X, it's Y" complaint is totally bonkers. We might as well call proper spelling a "sign of AI". I.e. yes, AI does it more than humans, but not by so much that it makes sense to be suspicious when you see it.
It is a great excuse for underperforming and incompetent CEOs.
It provides the CEO with a wonderful excuse for sacking people.
JIRA is just fine, gets the job done. Its not slow like the on-prem. Jira cloud version is fine.
The cloud version I used was slow and riddled with bugs. Entire views sometimes just refused to load or render, or something.
Did it "get the job done?" Yes, in a literal reading of those words, I suppose it did, but anyone who understands the amount of work that a modern 2.4 GHz CPU should be able to do per unit time would not think highly of it.
Nowadays … my company uses Linear … which, while it does have a sleeker, more modern looking UI … is nobody able to make a good bug tracker?
And ideally the user facing chats and threads are directly linked in to the development chats or at least with channel notifications somewhere.
Task assignment tooling encourages managers to stress developers out with low priority tasks that often start off with incorrect requirements that the structure makes it hard to correct because it is then directly a disagreement with your boss and there is inherently not a discussion it. Whereas a chat at least has the concept of an informational response to a nonsensical task as being fairly standard.
Seems like opposite land to me. Back in the day running Jira Server was the only way to get a snappy Jira instance. When they discontinued Jira Server to force everyone to the cloud it was god awful slow and forced us to abandon not just Jira but our entire Atlassisn stack.
Have used Gitlab+Jira in the past and now only use Gitlab and like it a lot more.
I work on Aha! Develop https://www.aha.io/develop/overview which I obviously think is a great tool, especially if you're a team with a product manager.
Smart move from JetBrains - many companies will already be paying them for their IDEs.
Sure maybe nobody got fired for choosing them, but it certainly killed my enthusiasm for the potential position.
I don't understand the AI layoffs; there's always an infinite supply of new work that could be done. Instead of firing 1600 people, why not have all of them use AI to produce more stuff and outrun their competitors.
Presumably all their competitors also know about Claude as well, and a lot of these 1600 people will go work for them and use Claude.
Unless this is just regular layoffs, but they know if they brand it as "AI" their investors will eat it up.
I distinctly remember a discussion where someone says "Man, I wish JIRA would add this feature/fix this bug"
Someone else pipes in: "I bet there is already a ticket on the JIRA bugtracker/feature board for this, it's not done and it's from 9 years ago" and lo and behold there was.
AI isn't going to help, but it bandaids over the issue so the investors aren't spooked.
Laying thousands of people off often implies you hired thousands of more people than you actually needed, which makes investors feel like you're wasting their money. If you say "no they're all being replaced for $200/month of Claude Code!" then it makes you look like there was actually strategy to this.
I definitely buy this for the software sector or the economy as a whole, but for an individual company? Seems one would be bottlenecked by various factors quickly.
Perhaps better to let people go so that they can be productive elsewhere?
I have worked for a bunch of companies, and even relatively new and young companies have all these things pile up pretty quickly.
True. Joining thousands of other unemployed developers sending applications into a job posting for a nonexistent role online is very productive. Probably good for the economy too now that I think about it.
Alternative take: I can't speak for BitBucket because I've never used it, but I've had enough time with JIRA and Confluence to last a lifetime, and these products are so bad - so clunky, so slow, so much friction in the UI - that I can't really see what useful value adding work Atlassian's 16,000 employees have actually been delivering. From that perspective losing 1600 of them seems like it's not likely to make much difference since, from my perspective as a user, they didn't appear to be doing anything useful in the first place.
I'm sorry if that comes across as a particularly savage take but Atlassian have wilfully been churning out absolute garbage for at least 15 years now (there was a time, in around 2006/7, when I thought JIRA was quite good - genuinely) and their products have made me miserable throughout a good chunk of my career, so my sympathy is pretty limited. If they can be bothered to make the products better, faster, more usable, and remove friction ruthlessly at every turn in their workflows, then I might well change my point of view.
I agree with pretty much everything you said; I don't actually think that it's due to AI is my point. If their products are terrible and they're finally losing business over it, it makes enough sense to fire 10% of the workforce. I just don't think AI has much to do with it.
Antidotal but I have spoken to friends at Google who are telling me many co-workers say "I tried it didn't work, ill do it myself" when really they just didn't try very hard at all.
And since the fact that claude code is an electron app and not AI generated optimized binary per platform, it's abundantly clear that perhaps AI is not all they hype it up to be.
* Their balance sheet paints a messy picture. Their gross profit per quarter doubled from 23Q1 ($668mn) to 26Q2 ($1.35bn), but their net income has been a consistent loss - from -$13mn in 23Q1, to -$42.6mn in 26Q2. The company has generally failed to turn a meaningful profit after considering operating expenses, reflecting misaligned priorities of leadership.
* Their headcount similarly whipsaws of late. In 2021, it was 8.8k; by 2025, it was 13.8k; in the middle of COVID, it was as low as 6.4k. Even after these job cuts, their headcount remains roughly flat from 2025.
* Cutting jobs to invest in AI when you're already slowly bleeding cash isn't exactly a winning strategy. Atlassian's products have the benefit of organizational "stickiness", and their push to a cloud-only SaaS model hasn't gone all that well if you read the IT rags (lots of uniquely complicated migrations that don't transition well 1:1 to SaaS).
* That said, pointing to AI while cutting jobs isn't a bad play when you're courting investors, many of whom doubt the long-term viability of the XaaS model when AI can slop up boilerplate and internal-only solutions on the fly. If they're doing it to genuinely cut costs and try and right the ship, fingering AI isn't a bad cover.
* Except the reality is most of Atlassian's leadership gets their comp in equity, which has taken a serious hit of late on the markets just as vesting schedules wind down and leadership is changing over. I'd be on the lookout for SEC Form 4's from insiders in the coming weeks to confirm whether or not this was the case.
The reality is that the "AI layoffs" ploy is almost exclusively a cover story for corporations reasserting dominance and power over workers after a few (comparatively) good years (WFH, higher pay increases, wage gains, flex-time, etc). Every single one of these entities obviously has more work than people to do it, but if they can squeeze 90% of the workforce for 110% of the hours, that's a net gain for the corporation and a net loss for workers.
Efficiency, over-hiring, right-sizing, AI; it's all bullshit smokescreens for greed, plain and simple. Don't be fooled by narratives to the contrary.
Jira regularly makes it to the top of lists of the most hated enterprise software, there’s definitely appetite in the market for a replacement.
Their stock has been taking a huge hit over the last few months because of this: https://www.smh.com.au/business/companies/ai-is-eating-softw...
Either way, I'd expect that those 1,600 people using AI to solve Atlassian's big problems would be better for the company in the long-run than reducing headcount with the same level of output
Possibly a bad LLM edit; maybe they meant to say would save $230 million through reduced headcount and less office space?
But $230 million over 1,600 is $145k per person.
In several countries, laying off people come with legal requirements for mandatory minimal severance, health insurance extensions, legal taxes and government fees and all kind of compensatory one-time payments for the fired employeer.
In the UK, statutory redundancy pay, after 2 years of service, is 1 week of pay per year of service and 1.5 weeks if you're over 41.
For a long duration commercial lease it might be worth paying to break the contract rather than the running costs for an unused building.
These are probably short-term costs, with longer term savings projected from the reduction in headcount and premises.
But let's try to spin it up as if we were some kind of AI mavens who are reaping humongous increases in productivity due to our thought leadership in AI.
- CEO (under pressure to move in the AI space) comes across as an AI maven
- The shareholders improve margins
I think we're reeling from rate increases. Too much free money for too long.
Tariffs
War in the Middle East
US economy that would likely be in recession if not for massive datacenter spend
Oil at ~$100
But we're laying people off because... AI
Their services are barely usable with extreme bloat and lag. With such strong engineering practices, they are poised to make fools of themselves. Can't wait.
To be clear, I agree with the terrible products part - but currently they are not dying because there is no alternative platform which is flexible, scalable and feature-complete enough. You may find alternatives for niches, like GitHub for software engineering, but the Atlassian stuff allows for knowledge transfer and familiarity across many many domains. I've seen it used anywhere from government burocracy to customer service and construction companies. They nailed the abstraction for flexible issue management, just the implementation is terrible.
We don't really know, if the layoffs are because of AI.
https://www.thelayoff.com/ - This site is a discussion forum, some fake information before the actual layoffs.
Be interesting to see the numbers graphed over time.
Funny thing about AI layoffs is the cloud cover it provides to do it. Which I know is not a fresh insight. :-)
In HR speak, if you 'reduce headcount' because you over hired or needed to cut costs, then that's a bad signal to the markets.
If you do it because of AI efficiencies, you are an innovative industry leader and your stock goes up.
Atlassian stock up 2% on the news :-/
Would be interesting to know if they are majority engineering, or if that's a lot of sales and marketing and support and other roles in there.
> The union representing Atlassian workers, Professionals Australia, said impacted employees were told on Thursday, with a consultation process to last until 19 March and final termination expected on 2 April.
https://www.theguardian.com/technology/2026/mar/12/atlassian...
I don't think any AI productivity gains are involved.
Makes you look innovative.
KB: Notion over Confluence no question
Just a couple examples, you could swap a dozen other better vendors in either category.
What does Atlassian have but inertial lock-in to keep them going?
“AI doesn’t replace people, but it’s silly to pretend it doesn’t replace people”, says man planning to use AI to replace people.
A company that prizes actually making customer lives better (i.e. "innovation") will salivate at the prospect of having ten of ten people, each using the Drudgery Automator, being creative using all that drugery-free time to actually touch grass with their customers and ship overnight value (i.e. actually, progressively, make things better for customers) and then improve it at a pace that blows minds (i.e. actually happy customers).
An company who's business is in fact about drudgery automation will kneecap itself by letting go nine of the ten.
Long/Short stocks accordingly.
No you’re just cutting costs
That’s why “slop” is so appropriate. It’s the runoff from the taps poured into a glass. Tastes like everything, nothing, definitely not pleasing, probably cheap, still effective at getting you inebriated.
Fuck ‘em. Rolling my own using shelfware, kthxbai.
I mean, they save money and Jira is already a slow buggy and insecure pile of sloppy code so there is no real downside.
@dang
AI is a convenient way to hide their their poor strategy and execution.
- Scales well from simple configuration and workflows to more complex multiboard views/custom fields/layouts per issue type etc
- Good OOTB integration with common CI/CD - see PRs, deploys etc from each ticket
- Good (adequate?) integration with their wiki in Confluence
- JQL for being able to do custom reporting tooling (get me all issues transitioned to X status in this time period)
Things that frustrate me:
- Complexity/UI around configuration
- Very poor kanban metrics reporting
Seriously, you need a heck of a lot more than a random HN reply to give you Jira alternatives if you've been embedded into its ecosystem for any length of time - and my condolences if you have.
