Adobe Systems released the earnings results from its first fiscal quarter after closing bell tonight, posting adjusted earnings of 66 cents per share and revenue of $1.38 billion, against the consensus estimates of 61 cents per share in earnings and $1.34 billion in sales. GAAP earnings were 50 cents per share. The company’s stock surged in after-hours trades, climbing by as much as 6.49% to $95.80.
Adobe Systems reports record quarterly revenue
Adobe Systems said its revenue represented a 25% year over year growth rate and set a new record for quarterly revenue. Digital Media sales climbed 33% to $932 million as Creative sales climbed 44% to $733 million. The company said Digital Media Annualized Recurring Revenue grew $246 million to $3.13 billion on the back of strong adoption of its Creative Cloud product. Adobe Marketing Cloud recorded a 21% year over year increase in revenue to $377 million on the back of strong growth in bookings.
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Subscription revenue soared from $713 million last year to $1.07 billion this year, while product revenue edged lower from $290.8 million last year to $201.1 million this year. Services and support revenue increased from $105 million last year to $112 million this year.
Operating income climbed 78% year over year, while GAAP net income skyrocketed by 200%. Cash flow from operations amounted to $498 million, while deferred revenue increased to reach $1.61 billion. Adobe Chief Financial Officer Mark Garrett said in a statement:
“We are pleased to report another record quarter with 25 percent year-over-year revenue growth. Strong Cloud adoption drove record Creative and Marketing Cloud revenue in Q1, and better-than-expected Digital Media ARR. Based on our strong Q1 results and business momentum, we are increasing our annual revenue and earnings targets for the year.”
Adobe Systems bought back about 1.5 million shares during the first fiscal quarter for about $133 million. The company’s stock is down by more than 4% year to date, although it’s up by nearly 16% over the last year.