Adobe lifts profit forecast for fiscal 2023 and beats estimates on quarterly results

Adobe shares rose 5% in extended trading on Wednesday after software maker announced fiscal first-quarter results that topped Wall Street estimates and lifted its full-year foercast.

Here’s how the company did:

• Earnings: $3.80 per share, adjusted, vs. $3.68 per share as expected by analysts, according to Refinitiv.
• Revenue: $4.66 billion, vs. $4.62 billion as expected by analysts, according to Refinitiv.

Revenue 9% year over year in the quarter that ended March 3, according to a statement. Net income fell slightly to $1.25 billion.

The company’s Digital Media segment, which includes the Creative Cloud design software bundle, generated $3.4 billion in revenue, up 9% from a year and above the $3.36 billion consensus among analysts polled by StreetAccount.

Adobe’s Digital Experience segment, which features Marketo marketing software, contributed $1.18 billion in revenue, just above the $1.17 billion StreetAccount consensus.

For the second quarter, Adobe expects earnings per share of $3.75 to $3.80 on an adjusted basis and $4.75 billion to $4.78 billion in revenue. Analysts surveyed by Refinitiv had been expecting $3.76 per share in adjusted earnings and $4.76 billion in revenue.

Adobe bumped up its profit forecast for the 2023 fiscal year, and now sees $15.30 to $15.60 in adjusted earnings per share, with $1.7 billion in net new annualized recurring revenue from Digital Media. In December Adobe said it was looking for $15.15 to $15.45 in adjusted earnings per share for the full year, with $1.65 billion in net-new Digital Media ARR. Analysts polled by Refinitiv were looking for $15.31 in adjusted earnings per share.

During the quarter, Microsoft said it was embedding Adobe’s Acrobat PDF engine into Edge, the default browser in Windows 10 and 11, and Adobe said it’s been engaging with regulators in the U.S., U.K. and EU on its pending $20 billion acquisition of design software startup Figma. “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 CEO Shantanu Narayen said on a conference call with analysts.

Excluding the after-hours move, Adobe shares have declined 1% so far this year, while the S&P 500 index has risen 1%.

This is breaking news. Please check back for updates.

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