Sep. 17, 2013, 5:17 PM
- Adobe (ADBE) spent $326M in FQ3 to repurchase ~7M shares (1.4% of outstanding shares).
- Deferred revenue totaled $734M at the end of FQ3, +6% Q/Q and reversing FQ2's 1% drop.
- Adobe declares "the overwhelming majority" of its customers are shifting from perpetual to term-based licenses, validating market acceptance of Creative Cloud.
- Document Services revenue (a portion of Digital Media revenue) fell 1.5% Y/Y to $182.7M thanks to shift towards Acrobat subscriptions. Document Services ARR rose 30% Q/Q to $109M, with total subscribers topping 1.3M after crossing 1M in FQ2.
- Print/publishing revenue was soft, falling 14% Y/Y to $46.7M (5% of revenue).
- Adobe also announces Project Mighty (a Bluetooth-equipped tablet stylus) and Project Napoleon (a digital ruler/guide) will be released in 1H14 (previous).
- R&D spend +10% Y/Y to $208.7M, sales/marketing spend +5% to $388.7M. CC/Marketing Cloud investments have much to do with the R&D growth.
- ADBE +5% AH
- FQ3 results, guidance/subscriptions
Sep. 17, 2013, 4:33 PM
- In addition to missing FQ3 estimates, Adobe (ADBE) is guiding for FQ4 revenue of $1B-$1.05B and EPS of $0.28-$0.34, below a consensus of $1.08B and $0.41.
- However, the company also states it added 331K paid Creative Cloud subs in FQ3, easily more than FQ2's 221K and FQ1's 153K, and leading the total base to grow to 1.031M. Enterprise CC adoption was stronger than expected.
- Creative annual recurring revenue (ARR) +53% Q/Q to $546M. Adobe expects to add "slightly more" CC subs in FQ4 than were added in FQ3, and is on track to top its FY13 Digital Media ARR target of $800M.
- The shift to cloud subscriptions from up-front licenses has the effect of making Adobe's near-term revenue and earnings trail its bookings and free cash flow, as cloud revenue is recognized over the life of a subscription. Thus, thanks to the CC shift, Adobe's recognized Digital Media revenue fell 16% Y/Y to $636.7M.
- Marketing Cloud (ad tech) had another strong quarter, growing 28% Y/Y (25% exc. Neolane) and reaching a $1B/year run rate. Total Digital Marketing revenue +18% to $311.7M.
- CC at 5PM ET. FQ3 results, PR.
Sep. 17, 2013, 4:02 PM
Sep. 17, 2013, 12:10 AM
Sep. 16, 2013, 5:35 PM
Aug. 26, 2013, 9:14 AM| Comment!
Jul. 31, 2013, 5:26 PM
- Adobe (ADBE) has acquired Satellite, developer of a service that manages and improves the performance of analytics/media-tracking tags that are found on web sites, and used to interact with 3rd-party ad/analytics services.
- The purchase follows Adobe's June acquisition ad campaign management software firm Neolane, and should bolster its Marketing Cloud ad tech suite.
- Google launched a similar service, called Tag Manager, last fall.
Jul. 17, 2013, 11:48 AMFBR throws in the towel on Adobe (ADBE +1.5%), upgrading shares to Market Perform even though it thinks its thesis for an Underperform rating (Creative Suite share losses and slowing revenue growth) has played out. The firm grants some of Adobe's CS weakness was due to the Creative Cloud shift, but still thinks "a weakening end market" was also responsible. Shares have edged towards their 52-week high of $48.63. | Comment!
Jun. 27, 2013, 4:50 PMAdobe (ADBE) responds to Salesforce's (CRM) deal to buy ExactTarget in a big way, agreeing to purchase French ExactTarget rival Neolane for $600M in cash. Neolane, whose acquisition comes a year after Adobe paid $400M to buy online ad buying platform Efficient Frontier, develops software that lets businesses integrate offline and offline data to created automated ad campaigns; the company claims 400 customers. On top of ExactTarget, Neolane competes with Marketo (MKTO), Responsys (MKTG), and Oracle-acquired Eloqua. The company will be added to Adobe's Marketing Cloud unit, which posted 18% revenue growth and 25% bookings growth last quarter. | 3 Comments
Jun. 26, 2013, 9:41 AMTech ratings change roundup: 1) Mellanox (MLNX +2.7%) has been upgraded to Buy by Stifel. 2) NetGear (NTGR -4.6%) has been downgraded to Sell by Goldman. 3) ARM (ARMH +1.1%) has been upgraded to Buy by Benchmark, and to Overweight by Piper. 4) Rackspace (RAX +5%) has been upgraded to Outperform by Wells Fargo. 5) Splunk (SPLK +1.9%) has been started at Outperform by Wedbush. 6) Allot (ALLT +3.7%) has been upgraded to Outperform by Wedbush, and to Buy by Wunderlich. 7) Rubicon (RBCN -3.3%) has been downgraded to Neutral by JPMorgan. 8) Orbitz (OWW +4.1%) has been started at Buy by Ascendiant Capital. 9) Lam Research (LRCX -1.4%) has been upgraded to Buy by BofA/Merrill. 10) Adobe (ADBE +2.4%) has been upgraded to Buy by Jefferies. | Comment!
Jun. 20, 2013, 1:51 PMWhen Adobe (ADBE -2.5%) announced it would stop releasing new versions of Creative Suite to focus on Creative Cloud subscriptions, many observers felt one of the company's motivations was to combat the widespread piracy of its costly media-editing apps. If that's the case, Adobe has more work ahead of it: the latest versions of its Creative Cloud apps have been pirated just one day after being released. Though Adobe requires a Web connection to initially install/license the apps, they can then be used in offline mode; Adobe tries to validate the license every 30 days. | 1 Comment
Jun. 19, 2013, 10:23 AMBofA/Merrill upgrades Adobe (ADBE +6.1%) to Buy in the wake of its FQ2 EPS beat and strong Creative Cloud adds: the firm is upbeat about CC into 2015, and sees Adobe converting much of its Creative Suite base. Jefferies notes CC net adds of 221K beat a consensus of ~185K. Mentioned on the earnings call: the majority of paid CC subs are individual members; Adobe is evaluating new options for CC pricing (previous); "targeted promotions" could hurt CC ARPU in the near-term; and Adobe thinks its infrastructure and analytics tools will allow Marketing Cloud to remain differentiated in the face of new competition. Ad software rival Marketo (MKTO +10.1%) is in sympathy. | Comment!
Jun. 19, 2013, 9:05 AM
Jun. 18, 2013, 5:48 PM
Jun. 18, 2013, 4:43 PMA little more on Adobe: Marketing Cloud bookings +25% Y/Y. 26% of Digital Marketing transactions now mobile (25% in FQ1). 42% of Adobe's (ADBE) Document Services (Acrobat) revenue subscription-based; 1M+ paid subs. 3.9M shares repurchased. R&D spend +12% Y/Y to $203M, sales/marketing spend +4% to $402M. Company on track to reach goal of 1.25M Creative Cloud subs by end of FY13; 93% of CC subs on annual (rather than monthly) plans. Deferred revenue -1% Q/Q to $691.3M. 35% of company's revenue recurring at end of FQ2, up from 31% at end of FQ1. (PR) | 3 Comments
Jun. 18, 2013, 4:35 PMMore on Adobe: FQ3 guidance is for revenue of $975M-$1.025B and EPS of $0.29-$0.35, vs. consensus of $1.01B and $0.35. FY13 guidance is for revenue of $4.1B and EPS of $1.45 vs. consensus of $4.11B and $1.44. Paid Creative Cloud subs +221K Q/Q to 700K in FQ2, better than FQ1's +153K. CC annual recurring revenue +$123M Q/Q to $356M (rose $80M in FQ1), 81% of subs use full suite. Digital Media revenue -18% Y/Y to $670M (shift to subscriptions), Digital Marketing (Omniture, AdLens) revenue +11% to $285M. ADBE +3.9% AH, CC at 5PM ET (webcast). (slides) (datasheet) (prepared remarks) (PR) | Comment!
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Adobe Systems Inc offers a line of software and services used by creative professionals, marketers, developers, enterprises and consumers for creating, managing, delivering, measuring, optimizing and engaging with compelling operating systems.
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