Adobe Gains on Increased Full-Year Forecast
Adobe (ADBE:US) shares are trading higher on Thursday after the tech company raised its profit forecast for the full year on the back of the better-than-expected results for its fiscal first quarter.
The company posted an adjusted EPS of $3.80 to beat the consensus for earnings of $3.67 per share. Revenue rose by over 9% YoY to $4.66 billion, just ahead of the $4.63 billion consensus. Adobe’s two biggest business units - Digital Media and Creative - both generated better-than-expected sales in FQ1.
“Adobe drove record Q1 revenue and we are raising our annual targets based on the tremendous market opportunity and continued confidence in our execution,” said Shantanu Narayen, chairman and CEO, Adobe. “Creative Cloud, Document Cloud and Experience Cloud are mission-critical in fueling the global digital economy.”
For this quarter, Adobe sees EPS in the range of $3.75-3.80 on revenue of $4.75-4.78 billion. The company expects its Digital Media unit to generate net new annualized recurring revenue of about $420 million.
Given the better-than-expected outlook for FQ2, the company raised its full-year outlook to the range of $15.30-15.60 from the prior range of $15.15-15.45.
On the pending $20 billion Figma acquisition, Narayen said:
“We have completed the discovery phase of the U.S. DOJ second request and are prepared for next steps, whether that is an approval or a challenge. Adobe remains confident in the facts underlying the case. And based on current process timing, we believe the transaction continues to be on track for a close by the end of 2023,” the chief executive said on the earnings call.
Adobe stock attracted the attention of several Congress members recently. Congresswoman Diana Harshbarger, as well as her colleagues Ro Khanna and Josh Gottheimer, bought the stock earlier this year.
Congressman Kevin Hern disclosed in January that he closed the $250,000 - $500,000 ADBE position on December 19, when the stock closed at $328.76.
Adobe shares trade nearly $353.29 a share on Thursday.
