Adobe Earnings, Revenue Top Expectations
Adobe Systems reported fiscal fourth-quarter earnings and revenue Thursday that exceeded analysts' forecasts.
The maker of such popular software as Photoshop and Acrobat saw it stock jump after the closing bell, following the news.
Net income rose to $222.3 million, or 44 cents per share, from $173.7 million, or 35 cents per share, a year earlier.
Earnings excluding items decreased to 61 cents per share in the fiscal fourth quarter from 67 cents in the year-earlier period.
Revenue was flat from a year ago at $1.15 billion.
Analysts had expected the company to report earnings excluding items of 57 cents a share on $1.1 billion in revenue, according to a Thomson Reuters consensus estimates.
Adobe said it added about 10,000 Creative Cloud subscriptions per week during the quarter, compared with 8,000 per week in the third quarter.
"Because the way they are driving that (subscription model) adoption through promotional pricing, that promotional pricing is offsetting to some extent the high adoption rate and so essentially revenues are flat," Edward Jones analyst Josh Olson said.
He said the company was executing its shift to subscription strategy better than expected, but "there's still some work to do, we'll see what 2013 brings."
In the second quarter, Adobe launched its Creative Suite 6 — which includes Photoshop, Illustrator, InDesign, Flash and Dreamweaver — and the Web-based Creative Cloud products based on a subscription model, aimed at providing a more stable revenue model.
The company said in September that fourth-quarter earnings will decline or remain flat as customers take to the company's new subscription-based model faster than expected.
Shares of the company have been rising since Dec. 11 after Jefferies & Co raised its price target on the stock saying investors are now more comfortable with the business model change.
— Reuters contributed to this article.