Adobe Comments on Its MacTel Support (ADBE, AAPL)

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by: Mick Weinstein

From the Adobe conference call:

John McPeake - Prudential Equity Group

Historically you have been a little more exposed than other software companies to the economic cycles, because of the graphic artists selling to the print and the other advertising segments. I’m just trying to get a sense as to (a) whether that is playing at all into the lower guidance, and then (b) just generally if you’re seeing any kind of a slowdown in your customer base at all, Bruce?

Bruce Chizen, Adobe

The overall environment for the Creative customers continues — at least in our view — continues to be extremely positive because of the diverse set of advertising, the number of platforms in which they have to deliver their content on, and just that overall explosion of content is driving demand for our products.

The biggest concern we have around that customer is that many of them are either looking to move to Apple’s new platform, or they have new moved to Apple’s new platform and our current set of products don’t work very well on the Mactel environment.

Phillip Rueppel - Wachovia Securities

From the statements you have made, it sounds like you’re not going to be offering native Mactel support until CS3. Is it possible that you could be offering some parts of the Creative Suite with any kind of optimization? Or are you aware of anything from Apple or the Emulator folks that could improve performance between now and a year from now?

Shantanu Narayen, Adobe

Clearly our products work on a number of the Mac platforms; they have continued to ship. As you know, they have introduced notebook versions of the Mactel platform. It is on the notebook versions of the Mactel platform where our Creative Suite products do not run as efficiently, because they have to be run emulated under what is called Rosetta to Apple.

So first and foremost, I do want to clarify that our products do continue to run on a number of the new hardware that Apple continues to ship. It is our intent again to focus on the CS3 version where we will provide the entire suite for Mactel, as well as for other operating systems, rather than doing any interim releases; and to continue on focusing on the marketing benefits of CS2 to the existing customer base.

Bruce Chizen, Adobe

Our Macintosh business is in excess of 20% of our overall business. The percentage is much, much higher for the Creative business. So there are many customers that continue to buy our Macintosh products to run both under their current computers, and they are running them on Mactel systems.

The performance is just not as good as we would like to be and it won’t get there until we ship CS3. That has been in our plan all along. I suspect that there is not much that we will be able to do until we actually release the CS3 product.

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