Adobe Raises Annual Revenue Forecast After Results Beat Projections
December 14 2017 - 5:10PM
Dow Jones News
By Maria Armental
Adobe Systems Inc. (ADBE) is raising annual revenue projections
following higher-than-expected results in the most recent quarter,
powered by its shift to a subscription model.
The software company now expects revenue to reach $8.73 billion,
up from its previous view of $8.7 billion.
Adobe on Thursday affirmed its annual profit view of $4.40 a
share, or $5.50 a share on an adjusted basis.
Shares, which closed at an all-time high on Nov. 28 at $186.27,
rose 1.7% to $177.82 in after-hours trading.
Subscriptions now account for most of Adobe's revenue, and
strong demand for services like Creative Cloud--which include
applications like Photoshop, InDesign and Illustrator--continue to
fuel growth. Creative revenue, its largest by revenue, reached
$1.16 billion in the latest period, up from $886 million in the
year-ago period.
Adobe, the company behind the ubiquitous PDF--the Portable
Document Format that allowed for the electronic transmission of
documents--was founded in 1982 and went public in 1986. It hasn't
paid a dividend since the first quarter of fiscal 2015, opting
instead for share buybacks to pass value on to shareholders. The
San Jose, Calif., company bought back 1.9 million shares in the
most recent period and ended the quarter with $2.31 billion in
cash, compared with $1.77 billion in the previous quarter.
Overall, fourth-quarter profit rose 26% to $501.5 million, or $1
a share. Excluding stock-based compensation and other items,
Adobe's profit rose to $1.26 a share from 90 cents a year
earlier.
Revenue rose 25% to $2.1 billion.
The results beat internal forecasts and analysts' estimates of
90 cents a share, or $1.16 on an adjusted basis. Analysts also
forecast Adobe generating $1.95 billion in revenue.
For the current quarter, Adobe projects profit of $1.15 a share,
or $1.27 as adjusted, on $2.04 billion in revenue. Analysts
surveyed by Thomson Reuters had projected 98 cents a share, or
$1.24 as adjusted, on $2.04 billion in revenue.
Write to Maria Armental at maria.armental@wsj.com
(END) Dow Jones Newswires
December 14, 2017 16:55 ET (21:55 GMT)
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