The eigenstates of spin about the vertical axis are not simultaneously eigenstates of spin about the horizontal axis, so this atom has an equal probability of being found to have either value of spin about the horizontal axis. As described in the section above, measuring the spin about the horizontal axis can allow an atom that was spun up to spin down: measuring its spin about the horizontal axis collapses its wave function into one of the eigenstates of this measurement, which means it is no longer in an eigenstate of spin about the vertical axis, so can take either value.