I don't think AI is even partially to blame. Unless Atlassian is claiming AI can fully replace 1,600 workers, layoffs don't make sense.

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.

Well you might not, if your accessible market is 10 horses and 5 cars can fill that market need, then you're left with 5 people who aren't needed because your products don't meet the needs of 10 cars worth.

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.

Good point, but what if you were previously chaining horse carriage rides and now a car can cover the same distance as 10 of them with a single driver?