Adobe (ADBE) Stock | Beats on Earnings, Cautious Forecast


Adobe Systems Incorporated (NASDAQ: ADBE)


Anybody that has used a computer and by “guesstimate” I would say 90% of American’s who are computer literate, know the name Adobe. Many may not know exactly what they do. Whether someone has used their popular Photoshop application, the Portable Document Format (PDF) or their cloud- based services, there’s no question this remains a behemoth in the computer and Internet industry, founded in 1982.

The company reported earnings after the close on September 17, 2015 that beat analyst expectations on both revenues and earnings, however, it was their forward-looking guidance that caused the downdraft in trading in the after-hours session.

The numbers were strong: “Adobe earned 54 cents a share excluding items in its fiscal third quarter of 2015, beating Wall Street’s target by 4 cents. Revenues also beat views at $1.22 billion, vs. the $1.21 billion predicted by analysts polled by Thomson Reuters.  Adjusted earnings per share rose 93% year over year in the quarter ended Aug. 28, vs. a 30% gain in Q2 and 47% in Q1. Sales rose 21% year over year in Q3, vs. 9% in Q2 and 11% in Q1.”


ADBE CEO Comments

When Asked about the company’s earnings results the CEO, Shantanu Narayen had this to offer, “Our execution and momentum continued in Q3, resulting in record quarterly revenue with outstanding profit and earnings growth,”, Adobe president and chief executive officer.

In other news,  Adobe said senior vice president David Wadhwani, has left the company “to pursue a CEO opportunity.” Bryan Lamkin will take over the digital media business. Lamkin leads the Document Cloud and corporate development and technology units. Abhay Parasnis, CTO, will expand his role integration, strategy, architecture and technology to assume security duties.


Technical Analysis


The daily price chart indicates a clear up-trend beginning in January 2015 until August when the price gapped down on news through the green, up-trending line and closed well below it. It has since rallied back up to that same trend line. A retracement like this to this area will likely show the character of the price performance going forward. It could mean a resumption of the uptrend or a new downtrend coming into effect.


Company Profile

Adobe Systems Incorporated is a diversified software company worldwide. It operates in three segments: Digital Media, Digital Marketing, and Print and Publishing. The Digital Media segment provides tools and solutions that enable individuals, small and medium businesses, and enterprises to create, publish, promote, and monetize their digital content. This segments flagship product is Creative Cloud, a subscription service that allows customers to download and install the latest versions of its creative products. This segment serves traditional content creators, Web application developers, and digital media professionals, as well as their management in marketing departments and agencies, companies, and publishers. The Digital Marketing segment offers solutions for how digital advertising and marketing are created, managed, executed, measured, and optimized. This segment provides analytics, social marketing, targeting, media optimization, digital experience management, and cross-channel campaign management solutions, as well as video delivery and monetization to digital marketers, advertisers, publishers, merchandisers, Web analysts, chief marketing officers, chief information officers, and chief revenue officers. The Print and Publishing segment offers products and services, such as eLearning solutions, technical document publishing, Web application development, and high-end printing, as well as publishing needs of technical and business, and original equipment manufacturers (OEMs) printing businesses. The company markets and licenses its products and services directly to enterprise customers through its sales force, as well as to end-users through app stores and through its Website at It also distributes certain products and services through a network of distributors, value-added resellers, systems integrators, independent software vendors, retailers, and OEMs. The company was founded in 1982 and is headquartered in San Jose, California. Yahoo Finance