The Strategist

Adobe fixes record quarterly revenue

06/22/2017 - 12:28

Graphics software maker Adobe continues to increase revenue through the digital business. Revenue for the second quarter (ended June 2) in 2017 increased by 27.3% compared to the financial results of the second quarter of 2016 - to a record $ 1.77 billion against $ 1.39 billion.

midiman via flickr
midiman via flickr
For the three-month period ended June 2, 2017, Adobe's net income rose 53.4% to $ 374.3 million, or 75 cents per share, from $ 244.1 million, or 48 cents per share, for the same period a year earlier. Excluding one-off items of the balance sheet, the company earned $ 1.02 per share. Analysts surveyed by Thomson Reuters I/B/E/S expected this figure to be 95 cents per share.

For the reporting quarter, revenue jumped by 26.7 percent to $ 1.77 billion. Analysts on average expected a profit of 95 cents per share on revenue of $ 1.73 billion. The company's revenue has been growing for 13 quarters in a row.

In recent years, Adobe has moved from the traditional model of selling software licenses to providing software through a subscription to cloud-based Creative Cloud service. The corresponding unit’s revenue increased by 29 percent in the second quarter to $ 1.21 billion. This surpassed expectations of analysts who predicted the figure at $ 1.17 billion, according to the research firm FactSet.

The average annual regular income in the digital media division was $ 4.56 billion, also exceeding forecasts of analysts polled by FactSet ($ 4.54 billion). Adobe expects an increase of $ 300 million in the third quarter.

A set of solutions Adobe Experience Cloud, which includes products such as Marketing Cloud and Adobe Analytics Cloud, recorded sales growth at a record level of $ 495 million, which is 29% more year on year.

Revenue from subscriptions increased over the three-month period by about 37 percent to $ 1.48 billion. For the same period a year ago, this figure was $ 1.1 billion. Sales of boxed products continued to decline, in the last reporting quarter it decreased from $ 196.5 million to $ 171.5 million.

According to the forecast of Adobe, the adjusted profit in the third quarter will be $ 1.00 per share, and revenue - $ 1.82 billion. Analysts polled by Reuters predicted a profit of 97 cents per share on revenue of $ 1.80 billion.

Against the backdrop of the news, the company's shares rose by about 4 percent to a record level of $ 146 in trading after the official closing of the exchange session.