Atlassian Corporation PLC (TEAM) shares plummeted 14% in after-hours trading on Thursday following the company's release of its third-quarter results and fourth-quarter outlook. The sharp decline comes as the cloud-based software provider projected lower-than-expected cloud revenue growth for the upcoming quarter.

For the third quarter, Atlassian reported adjusted earnings per share of $0.97, surpassing analysts' expectations. However, investors' focus quickly shifted to the company's forward-looking statements. Atlassian's management guided for fourth-quarter cloud revenue growth of approximately 23% year-over-year, a figure that appears to have disappointed Wall Street.

The tepid growth projection for cloud revenue, a key metric for software-as-a-service (SaaS) companies, suggests potential challenges in Atlassian's core business. As enterprises increasingly shift to cloud-based solutions, any slowdown in this area could signal broader issues with customer acquisition or retention.

While Atlassian has been successful in transitioning many of its customers to cloud-based products, the projected growth rate indicates a potential deceleration compared to previous quarters. This outlook may have sparked concerns among investors about the company's ability to maintain its growth trajectory in an increasingly competitive market for enterprise software solutions.

As the market digests this information, analysts will likely be closely monitoring Atlassian's performance in the coming months to determine whether this is a temporary setback or indicative of a longer-term trend. The company's ability to accelerate cloud adoption and drive revenue growth will be critical factors in regaining investor confidence and reversing the stock's downward movement.