Home » Stocks & Shares » Adobe beats analysts’ estimate for revenue and earnings per share in the fourth quarter

Adobe beats analysts’ estimate for revenue and earnings per share in the fourth quarter

Michael Harris
  • December 14th 2019, 19:32
  • Adobe beats experts' forecast for revenue and earnings per share in the fourth quarter.
  • Adobe aims at marking its dominance in the design related software.
  • Adobe reports highest quarterly revenue from its digital media unit.
  • Adobe's performance in the stock market has remained upbeat in 2019.

The American multinational computer software company, Adobe, announced its performance results for the fourth quarter on Thursday. Having beaten the analysts’ forecast for revenue, the stock was reported trading 2.7% higher later on Thursday.

The company reported expanding the customer base for its core digital media business. Subscriptions for flagship Creative Cloud suite, in particular, were highlighted to have risen sharply.

Adobe Aims At Marking Its Dominance In Design Related Software

While the cloud market continues to be monopolized by the software giants like Microsoft and Salesforce, with the likes of Photoshop and Illustrator, Adobe is busy marking its dominance in the market of design-related software.

Based on Refinitiv’s data, analysts had forecast $2.05 billion in revenue for Adobe’s digital media unit in the fourth quarter. The earnings report, however, highlighted the software company to have generated $2.08 billion in revenue instead, from the business segment. In terms of year over year growth in revenue, Adobe has posted a 22% improvement in revenue from the digital media unit as compared to the same quarter last year.

Adobe highlighted its earnings per share (EPS) in the fourth quarter at $1.74. In 2018’s Q4, Adobe’s EPS was reported much lower at $1.37 per share. The company’s net income of $851.9 million as noted in the Q4 earnings report, is significantly higher than $678.2 million that was printed last year.

The company recorded an even better EPS of $2.29 per share (excluding items). Driven from Refinitiv’s data, analysts’ estimate for earnings per share was capped at $2.26 per share (excluding items).

Adobe Beats Experts’ Forecast For Total Quarterly Revenue In The Fourth Quarter

The total quarterly revenue for the company came out to be $2.99 billion. Experts had anticipated the revenue in the fourth quarter to be capped at $2.97 billion for Adobe. The American multinational software company recorded a 21% growth in revenue as compared to the figure for last year.

2019 has been the year for Adobe in the stock market. Having opened the year at around $224, the company has printed a year-to-date high of $320 on Friday. In the after-hours trading on Friday, the stock was reported to be settling around the year-to-date high. Share prices for Adobe have remained above the opening level in 2019 so far. The software company currently has a market cap of $153.91 billion with a price to earnings ratio of 56.45.

Following the Q4 report, Adobe forecasted the revenue for 2020’s first quarter at $3.04 billion that remained shy of the Wall Street estimate of $3.09 billion. The company cited intense competition in the cloud market to be the reason for the dovish estimate.

About the author

Michael Harris
Michael Harris
I began trading in my early 20's at a local company and since then have combined my knowledge and love of content to become a news writer. I am passionate about bringing insightful articles to readers and hope to add some value to your portfolios!

Leave a Reply

Investing is speculative. When investing your capital is at risk. This site is not intended for use in jurisdictions in which the trading or investments described are prohibited and should only be used by such persons and in such ways as are legally permitted. Your investment may not qualify for investor protection in your country or state of residence, so please conduct your own due diligence. This website is free for you to use but we may receive commission from the companies we feature on this site. Click here for more information.