Adobe shares off as revenue outlook lags Wall Street estimates

Adobe  (ADBE) - Get Free Report shares slipped in premarket trading after the graphics-software stalwart reported stronger-than-expected adjusted fiscal-fourth-quarter earnings but a weaker-than-expected revenue outlook.

For the quarter ended Dec. 1, on a GAAP basis the San Jose, Calif., company reported net income per share rose 28% to $3.23 from $2.53 in the year-earlier quarter. Revenue advanced 12% to $5.05 billion from $4.53 billion.

Adjusted earnings for the quarter were $4.27 a share. That exceeded what Barron's reported was the Wall Street consensus of $4.13 a share. The company itself had pegged Q4 non-GAAP earnings at $4.10 to $4.15 a share.

Adobe's revenue figure for the fourth quarter was a tick ahead of the top of the company's estimated range of $5.03 billion.

Adobe revenue outlook lags estimates

For investors the issue appears to be a slight miss in the revenue forecast. For the first quarter ending in February, Adobe pegs revenue at between $5.1 billion and $5.15 billion, below what Barron's reports is the Wall Street consensus of $5.16 billion.

Adjusted profit for the first quarter is seen coming in at $4.35 to $4.40, exceeding what Barron's reported as the Wall Street consensus of $4.26.

For all of fiscal 2024 Adobe expects GAAP earnings of $13.45 to $13.85 a share. The adjusted estimate is $17.60 to $18 a share; the Wall Street consensus for the adjusted number is $17.99.  

Adobe puts revenue for the fiscal year at $21.3 billion to $21.5 billion, below what Barron's said was Wall Street's consensus estimate of $21.7 billion. 

The company bought back 1.8 million shares in the fourth quarter.

Chairman and CEO Shantanu Narayen said in a statement that the company was positioned well for 2024 and beyond.

At last check Adobe shares were trading off about 4% around $600. The stock on Tuesday touched a 52-week high $633.89. In 2023 through the close of trading on Wednesday, the stock was up 85%.

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