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Adobe Inc. shares initially were flat in extended trading Tuesday after the software company announced fiscal first-quarter results that beat expectations and strong financial guidance for the year.
Adobe
ADBE,
reported net income of $1.26 billion, or $2.61 a share, compared with net income of $955 million, or $1.98 a share, in the year-ago quarter. The company’s adjusted net income was $3.14 a share.
Revenue climbed 26% to $3.91 billion from $3.1 billion a year ago. Digital-media revenue led the charge with $2.86 billion, up 32% year-over-year.
“Adobe drove record Q1 revenue and we are raising our annual targets based on the tremendous opportunity across our business and our continued confidence in our global execution,” Adobe Chief Executive Shantanu Narayen said in a statement announcing the results.
Analysts surveyed by FactSet had expected first-quarter net income of $2.79 a share on revenue of $3.75 billion.
The Silicon Valley company also offered second-quarter and full-year guidance that exceeded analyst estimates, and said Chief Financial Officer John Murphy intends to retire in 2021. For the fiscal year, Adobe expects revenue of $15.45 billion and adjusted earnings of $11.85 a share. FactSet analysts have forecast $15.17 billion and $11.27 a share, respectively.
Adobe’s stock is down 8% so far this year. The broader S&P 500 index
SPX,
has improved 4% this year.
“We like Adobe’s monopolistic position within the creative cloud, where it delivers essential solutions to an important demography of creators,” JMP Securities equity research analyst Pat Walravens said in assessing Adobe’s ongoing performance.
