Earnings and Revenue Performance - Adobe Inc reported third-quarter fiscal 2024 non-GAAP earnings of $4 65 per share beating the Zacks Consensus Estimate by 2 65% and improving 13 7% year-over-year [1] - Total revenues were $5 41 billion surpassing the Zacks Consensus Estimate of $5 37 billion and rising 11% year-over-year on both reported and constant-currency bases [1] - Subscription revenues accounted for 95 8% of total revenues at $5 18 billion up 11 6% year-over-year while product revenues declined 14 6% to $82 million and services & other revenues decreased 10 4% to $146 million [3] Segment Performance - Digital Media segment revenues were $4 billion up 11% year-over-year surpassing the Zacks Consensus Estimate of $3 97 billion with annualized recurring revenues (ARR) reaching $16 76 billion and net new ARR of $504 million [4] - Creative Cloud revenues were $3 19 billion up 10% year-over-year beating the Zacks Consensus Estimate of $3 18 billion with ARR at $13 45 billion driven by strong adoption across geographies and customer categories [5] - Document Cloud revenues were $807 million up 18% year-over-year surpassing the consensus mark of $791 million with ARR at $3 31 billion driven by strong momentum in the Acrobat ecosystem and enterprise sales [6] - Digital Experience segment revenues were $1 35 billion up 10% year-over-year beating the consensus mark of $1 33 billion with subscription revenues of $1 23 billion rising 12% year-over-year [7] Operating and Financial Metrics - Gross margin expanded 170 basis points (bps) year-over-year to 89 8% while operating expenses increased 9 5% to $2 86 billion but contracted 50 bps as a percentage of total revenues to 52 9% [8] - Adjusted operating margin expanded 30 bps year-over-year to 46 5% [8] - Cash and short-term investments were $7 5 billion as of Aug 30 2024 down from $8 1 billion as of May 31 2024 while trade receivables increased to $1 8 billion from $1 6 billion [9] - Cash generated from operations was $2 02 billion in the reported quarter up from $1 94 billion in the previous quarter [9] Guidance and Market Position - For fourth-quarter fiscal 2024 Adobe projects total revenues between $5 50 billion and $5 55 billion with Digital Media revenues expected between $4 09 billion and $4 12 billion and Digital Experience revenues between $1 36 billion and $1 38 billion [10] - Net new ARR in the Digital Media segment is projected to be $550 million with Digital Experience subscription revenues anticipated between $1 23 billion and $1 25 billion [10] - Non-GAAP earnings per share are expected between $4 63 and $4 68 for the fourth quarter [10] - Adobe faces stiff competition in the AI software space from tech giants and well-funded startups like Stability AI and Midjourney which may delay returns from its AI investments [2] - The ADBE stock has lost 1 7% year-to-date against the industry's rally of 13 6% and experienced an 8% slump in pre-market trading due to weaker fiscal fourth-quarter revenue outlook [2]

Weak guidance raised questions about the software company's competitiveness in the current AI-centric environment.After the closing bell Thursday, Adobe (ADBE -9.21%) reported results for its fiscal third quarter that topped analysts' expectations. Despite that, shares of business software company were trading more than 9% lower early Friday afternoon, and it appears that the company's disappointing guidance for the quarter currently underway was the key driver of the sell-off.Unexpected headwinds blowingI ...

Adobe TodayADBEAdobe$534.26 -52.29 (-8.91%) 52-Week Range$433.97▼$638.25P/E Ratio48.00Price Target$606.86Add to WatchlistInvestors needn’t worry about Adobe’s NASDAQ: ADBE near-term price action because of the longer-term value gains derived from its quality. Adobe investors should instead focus on the bullish longer-term price action. The chart of monthly prices shows this leading SaaS provider that monetizes AI today is in a solid uptrend. The uptrend is marked by high volatility in 2020-2022, resulting f ...

Core Viewpoint - Adobe continues to demonstrate strong growth in its digital media and experience segments, despite a weak guidance for net new digital media annual recurring revenue (ARR) in Q4, which is expected to decline by 3.3% year-over-year. The company maintains a "Strong Buy" rating with a fair value of $600 per share [2][21]. Financial Performance - Adobe reported an 11% constant revenue growth, with 12% growth in Digital Media and 10% growth in the Digital Experience segment [4]. - For Q4 FY23, Adobe generated $569 million in net new digital media ARR but has guided for $550 million in the upcoming quarter [6][10]. - The company is guiding for total revenue of $5.5 to $5.55 billion in Q4, implying a 9.5% year-over-year growth [10][11]. Product Development and AI Integration - Adobe is set to release its Firefly Video Model later this year, which will allow creators to generate videos using AI tools, potentially competing with models from OpenAI and Runway [5]. - The company has surpassed 12 billion Firefly-powered generations across its tools, indicating significant investment in AI functionalities [4][9]. - AI-powered features in Adobe's platforms are expected to enhance customer engagement and drive additional subscriptions, contributing to future ARR growth [9][12]. Segment Growth Projections - The Digital Media segment is projected to grow by 12%, with 10% from traditional platforms and 2% from AI-related features [12]. - The Digital Experience segment has shown strong growth, with a 50% year-over-year increase in Adobe Experience Platform (AEP) and native applications [12]. Valuation and Future Outlook - The discounted cash flow (DCF) model projects an overall revenue growth of 11%, with operating margin expansion driven by pricing increases and operational efficiencies [13]. - The weighted average cost of capital (WACC) is calculated at 12.6%, supporting the fair value estimate of $600 per share [19].

Adobe CEO Shantanu Narayen speaks during an interview with CNBC on the floor at the New York Stock Exchange in New York City, Feb. 20, 2024.Shares of Adobe fell more than 9% on Friday, a day after the company released third-quarter results that offered worse-than-expected guidance for the fourth quarter.Adobe reported $5.41 billion in revenue for the quarter, up 11% year-over-year and above the $5.37 billion expected by analysts according to LSEG. The company's net income for the period was $1.68 billion, o ...

About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, ...

U.S. stock futures were mixed this morning, with the Dow futures gaining around 0.1% on Friday.Shares of Adobe Inc.  ADBE shares declined 10.3% to $75.02 in pre-market trading after the company reported quarterly results.Adobe reported better-than-expected earnings for its third quarter on Thursday. The company said it sees fourth-quarter revenue in a range of $5.5 billion to $5.55 billion and earnings of between $4.63 and $4.68 per share.Adobe shares dipped 8.5% to $537.00 in pre-market trading.Here are so ...

JHVEPhoto Adobe (NASDAQ:ADBE) stock fell by 9.1% in after-hours trading after reporting its Fiscal Q3-2024 results. However, the digital media and design software stock likely didn't deserve to fall by that much. The main reason for the fall was the lower-than-expected guidance, but it was hardly a miss. Now, you have a growing industry-leading company that's back to a reasonable valuation, and that suggests long-term upside from here. As a result, I rate the stock as a Buy. If ADBE stock falls more in the ...

bennymarty Investment Thesis Adobe (NASDAQ:ADBE) delivered a mediocre outlook with its fiscal Q3 2024 results, which led to a 9% sell-off. Even though its outlook wasn't too far off analysts' own expectations, this has been a battleground stock for a long time. Bulls call Adobe a value stock, while bears question whether this business is flying high on narrative and low on growth rates. For my part, I'm very much on the fence with Adobe, and believe that there are amply better opportunities elsewhere. Rapid ...

Core View - Adobe shares dropped sharply in extended trading due to a disappointing current-quarter outlook, despite better-than-expected fiscal Q3 results [1][3] - The stock is at risk of breaking below the lower trendline of an ascending triangle pattern, potentially starting a new downtrend [1][3] Technical Analysis - Adobe shares have been trading within an ascending triangle since late February, with a recent golden cross formation indicating a potential uptrend [3] - The stock fell 9 1% to $533 in after-hours trading, signaling a possible breakdown below the triangle's lower trendline [3] Key Support Levels - $500: Psychological support level and horizontal line connecting peaks and troughs from June 2023 to August 2024 [4] - $439: Potential buying opportunity near pre-gap consolidation period from May to June 2023, aligning with the May 2024 swing low [4] - $386: Support area near peaks from February to April 2023 [4] - $333: Long-term correction target, aligning with the May 2023 swing low and measured move price target [5] Key Resistance Level - $550: Potential selling pressure during countertrend moves, near the ascending channel's lower trendline [6] Market Context - Adobe shares have gained 28% over the past three months but remain underwater for the year due to cautious enterprise spending amid economic uncertainty and high interest rates [2]