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.