Wed, Jan. 14, 4:43 PM
- Adobe's (NASDAQ:ADBE) buyback is good for repurchasing over 5% of shares at current levels. It succeeds a prior $2B buyback that has been used up, and is good through FY17 (ends Nov. '17).
- The media/ad software giant spent $127M on buybacks during its November quarter, and $689M over the whole of FY14. It ended the quarter with $3.7B in cash/investments to finance capital returns with, and $1.5B in debt.
- ADBE +1.2% AH.
Dec. 12, 2014, 4:52 PM
- At least nine firms hiked their Adobe (NASDAQ:ADBE) targets after the company beat FQ4 estimates, reported stronger-than-expected Creative Cloud net adds, and announced it's buying Fotolia for $800M. Shares made new highs today, and have now more than doubled since late 2012.
- "We remain above management’s guidance for Q1 as we believe guidance is conservative," says Bernstein's Mark Moerdler (Outperform). He expects Adobe to end FY15 with 6.1M CC subs (above the company's 5.9M target), and sees the base rising to 7.9M by the end of FY16 and 8.2M by the end of FY17.
- UBS' Brent Thill (Buy) thinks Adobe could deliver FY17 EPS of $4.00 (well above FY15 guidance of $2.05), and that a $100/share valuation would be justified under such circumstances given "high visibility, high teens/low 20s rev growth, and 20%+ sustainable EPS growth."
- Morgan Stanley's Jennifer Lowe (Market Perform) likes the sub growth, but also notes a mix shift towards point product sales is pressuring ARPU. "ABDE plans to add 20% more subs in FY15 than added in FY14, but the same amount of [annualized recurring revenue], suggesting that lower-cost SKUs will continue to lead the way. We believe price has been a primary concern for those holding off on Creative Cloud, and the challenge for ADBE will be striking the right balance between price and unit growth to maximize ARR."
Dec. 12, 2014, 9:16 AM
Dec. 11, 2014, 5:35 PM
Dec. 11, 2014, 4:49 PM
- Adobe (NASDAQ:ADBE) added 644K Creative Cloud subs in FQ4, growing the total base to 3.45M and yielding 1.146M net adds for the second half of FY14. Guidance was for CC sub growth in the second half to only "slightly exceed" 1M.
- CC sub growth is expected to decline Q/Q in FQ1 (partly due to seasonality), but then increase in each of the following three quarters. Digital media annual recurring revenue (ARR) is expected to follow a similar trend. Adobe aims to end FY15 with 5.9M CC subs (+70% Y/Y).
- Thanks to the shift to CC subscriptions from up-front licenses, standard guidance is light: Adobe expects FQ1 revenue of $1.05B-$1.1B and EPS of $0.34-$0.40 vs. a consensus of $1.1B and $0.39. FY15 (ends Oct. '15) guidance is for revenue of $4.85B and EPS of $2.05 vs. a consensus of $4.93B and $2.07.
- Creative revenue is expected to grow "significantly" in FY15. Marketing Cloud (online ad tech) revenue and bookings to respectively rise 25% and 30%. Document Services (Acrobat) is expected to grow slightly; Print and Publishing and LiveCycle/Web Conferencing are expected to decline slightly.
- Marketing Cloud revenue, also affected by a shift towards subscription revenue streams, rose 4% Y/Y to $330.2M. However, FY14 bookings were up over 30%. Document Services revenue fell 1% to $197.1M.
- $127M was spent on buybacks in FQ4. GAAP opex rose 2% Y/Y to $807.4M.
- ADBE +7.8% AH. FQ4 results, PR, datasheet, prepared remarks.
Sep. 17, 2014, 10:08 AM
- BofA/Merrill Lynch analyst Kash Rangan is out in defense of Adobe (ADBE -3.8%), reiterating his Buy rating and $80 target and saying the selloff following disappointing revenue guidance is an overreaction, noting that creative cloud subscriptions hit 502K in FQ3 and implies a better than expected H2 number.
- The analyst explains the shift of revenue, as a greater than expected percentage of marketing cloud bookings is falling under multi-year subscription agreements with ratable revenue recognition vs. an upfront perpetual license.
- Bookings appear to be solid, Rangan says, with a 40% increase in the number of customers signing deals greater than $500K.
- Also, ADBE maintained its FY 2014-16 goal of 25% revenue compound annual growth rate for marketing cloud, driven by a strong on- and off-balance sheet backlog.
Sep. 16, 2014, 5:35 PM
Sep. 16, 2014, 4:23 PM
- Guidance is on the light side, with FQ4 revenue expected at $1.025B-$1.075B vs. the Street outlook of $1.09B, and EPS of $0.26-$0.32 vs. the Street at $0.31.
- Guidance is located in the earnings call presentation. The live call starts at 5 ET.
- ADBE -4% AH
- Previously: Adobe Systems beats by $0.02, misses on revenue
Jun. 18, 2014, 9:12 AM
Jun. 17, 2014, 5:35 PM
Jun. 17, 2014, 4:47 PM
- Adobe (ADBE) added 464K Creative Cloud subs in FQ2, up from 405K in FQ1 and 402K in FQ4; the base is now at 2.308M. The company now expects to end FY14 (ends in November) with 3.3M CC subs, up from a prior 3M.
- Marketing Cloud (ad tech) revenue +23% Y/Y in FQ2 to $283M, after growing 24% in FQ1. Adobe still expects at least 20% Marketing Cloud rev. growth and 30% bookings growth in FY14. LiveCycle/conferencing revenue -17% to $47.4M.
- CC annualized recurring revenue (ARR) rose by $208M in FQ2 to $1.195B, and Document Services (Acrobat) ARR by $19M to $183M. Adobe now expects to end FY14 with total Digital Media ARR of $1.925B, up from a prior $1.85B.
- With the cloud transition pushing out revenue recognition, Adobe expects FQ3 revenue of $975M-$1.025B and EPS of $0.22-$0.28 vs. a consensus of $1.02B and $0.27. Investors don't mind.
- 44% of FQ2 revenue was from subscriptions, and 53% was recurring. The deferred revenue balance rose by $48M Q/Q to $929M.
- R&D spend +2% Y/Y, sales/marketing +6%. $166M was spent on buybacks.
- FQ2 results, PR, datasheet, prepared remarks
Dec. 20, 2013, 9:33 AM
- Oracle (ORCL -0.1%) is acquiring cloud marketing automation software firm Responsys (MKTG) for $1.5B, or $27/share, in cash. The price represents a 38% premium to Responsys' Thursday close. The deal is expected to close in 1H14.
- Oracle has already made several online/social media marketing software acquisitions in recent years, the largest being its $871M purchase of Eloqua. Responsys' products, like Eloqua's, will be added to Oracle's Customer Experience Cloud, which offers a number of cloud-based sales/marketing software products..
- Oracle is doubtlessly looking to better compete against Salesforce (CRM +0.5%), which just spent $2.5B to buy marketing automation software vendor ExactTarget. The deal fueled hopes Responsys or Marketo (MKTO) would be acquired as well. Marketo and Constant Contact (CTCT +4.2%) are trading higher in response to the deal.
- Adobe (ADBE) is also moving aggressively in this space; it recently bought French marketing automation vendor Neolane for $600M. Oracle, Salesforce, and Adobe, along with SAP and IBM, are each trying to profit from an ongoing shift in ad spend towards digital channels (inc. social media), and a shift in IT spend towards CMOs.
Dec. 13, 2013, 9:16 AM
Dec. 12, 2013, 5:34 PM
Sep. 18, 2013, 9:11 AM
Sep. 17, 2013, 5:36 PM
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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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