Adobe Systems, Inc. (ADBE) Tops Q2 EPS by 7c, Offers Q3 Guidance

(Updated - June 17, 2014 4:26 PM EDT)

Adobe Systems, Inc. (NASDAQ: ADBE) reported Q2 EPS of $0.37, $0.07 better than the analyst estimate of $0.30. Revenue for the quarter came in at $1.07 billion versus the consensus estimate of $1.03 billion.

Adobe exited Q2 with 2 million 308 thousand paid Creative Cloud subscriptions, an increase of 464 thousand when compared to the number of subscriptions as of the end of Q1 fiscal year 2014.

Executive Quotes

“Adobe’s first-half upside was driven by accelerated adoption of Creative Cloud and Adobe Marketing Cloud,” said Shantanu Narayen, president and chief executive officer, Adobe. “We’re excited about our upcoming product pipeline and expect a strong second half of the year.”

“Our earnings performance in Q2 reflects the financial leverage we have in our model,” said Mark Garrett, executive vice president and chief financial officer, Adobe. “With Adobe’s Creative Cloud transformation behind us, our focus moving forward is to drive strong revenue and earnings growth with our market-leading cloud offerings.”

Q3 FY2014 Targets
Revenue $975 million to $1.025 billion (Street sees $1.02B)
Non-operating Other Expense $14 million to $16 million
Tax Rate GAAP: 26% to 28% Non-GAAP: 21%
Earnings Per Share GAAP: $0.02 to $0.08 Non-GAAP: $0.22 to $0.28 (Street sees $0.27)
Share Count 506 million to 508 million shares

• Expect the addition of approximately $250 million of Digital Media ARR in Q3 FY2014
• Expect Digital Media segment revenue to decline sequentially
• Targeting Adobe Marketing Cloud revenue to grow approximately 20% year-over-year
• Expect combined LiveCycle and Connect revenue to decline sequentially
• Expect Print and Publishing segment revenue to be relatively flat sequentially

For earnings history and earnings-related data on Adobe Systems, Inc. (ADBE) click here.

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