Adobe releases an upbeat Q2 earnings report on a higher demand for digital products

Adobe Inc. (NASDAQ: ADBE) released its quarterly earnings report on Thursday that topped the analysts’ estimates for earning. The company said that its digital products were greatly in demand in the recent quarter as Coronavirus restricted people to their homes. Adobe recently brought photoshop camera to android and iOS.

CEO Shantanu Narayen of Adobe commented on its report on Thursday and said:

“The tectonic shift toward ‘all things digital’ across all customer segments globally will serve as a tailwind to our growth initiatives as we emerge from this crisis.”

Shares of the company jumped a little under 5% in extended trading on Thursday. At £320.70 per share, Adobe is roughly 20% up year to date in the stock market after recovering from a low of £226.24 per share in March. In comparison, the benchmark S&P 500 index is currently 7% down in 2020 so far. Learn more about swing trading.

Adobe posts £870 million in net income in Q2

Adobe said that its net income in the second quarter came in at £870 million that translates to £1.80 per share. In the same quarter last year, its net income was recorded at a much lower £502.16 million or £1.02 per share. On an adjusted basis, the company made £1.94 of earnings per share versus the year-ago figure of £1.45 per share.

The American multinational company posted £2.48 billion in revenue in Q2 as compared to £2.18 billion in the comparable quarter of last year. According to FactSet, analysts had forecast Adobe to print £2.51 billion in revenue and make £1.84 of earnings per share in the second quarter.

Adobe’s financial guidance for the third quarter

The software company also highlighted its annual recurring revenue (ARR) from digital media at £7.28 billion versus the analysts’ forecast of £7.23 billion. ARR for its creative segment registered at £6.29 billion that was in line with the expert’s forecast. Adobe also topped the expectations of £940 billion in ARR from document cloud segment, noting a higher £980 million on Thursday.

For the third quarter, the San Jose-headquartered company anticipates £2.50 billion in revenue and £1.91 of adjusted earnings per share. Analysts, on the other hand, estimate £2.59 billion for Adobe in Q3 revenue and £1.95 of earnings per share.

Adobe performed largely upbeat in the stock market last year with an annual increase of a little under 50%. It is currently valued at £148.43 billion and has a price to earnings ratio of 51.13.