Adobe Beats Wall Street’s Second-Quarter Targets, Guides Higher
Digital media and marketing software firm Adobe Systems (ADBE) late Thursday beat Wall Street’s targets for its fiscal second quarter and guided higher for the current quarter, but shares fell in extended trading.
Adobe Systems earned an adjusted $ 1.66 a share, up 63% year over year, for the period ended June 1. Sales rose 24% to $ 2.20 billion. Analysts expected the San Jose, Calif.-based company to earn an adjusted $ 1.54 a share on sales of $ 2.16 billion.
For its current fiscal third quarter, Adobe expects to earn an adjusted $ 1.68 a share on sales of $ 2.24 billion. Wall Street was modeling Adobe to earn $ 1.61 a share on sales of $ 2.22 billion.
“In Q4, we anticipate normal seasonal strength and a strong finish to the year,” Adobe Chief Financial Officer John Murphy said in written remarks.
Adobe shares fell 2.4% in after-hours trading on the stock market today. The stock hit a record high of 258.91 in intraday trading on Thursday. It is up 47% year to date through Thursday’s closing price of 258.10.
Recurring Revenue Grows
Adobe’s annualized recurring revenue from its digital media businesses grew to $ 6.06 billion exiting the quarter, a quarter-over-quarter increase of $ 343 million. The company’s Digital Experience marketing business sales rose 18% year over year to $ 586 million.
“Adobe delivers all the capabilities to enable transformative digital experiences, including content creation and management, predictive analytics and commerce,” Chief Executive Shantanu Narayen said in a news release. “Our record results in Q2 reflect continued execution against this significant opportunity where Adobe is the clear market leader.”
The company’s stock is currently ranked No. 27 on the IBD 50 list of top-performing growth stocks.
Adobe’s 3 Investing Lessons; These 3 Hot IPOs Keep Moving Late
Adobe Systems Seen Bumping Heads With Salesforce.com