Adobe’s Profit Slips, Targets Trimmed

Low profits overshadow increasing revenue and hurt forecast

   
Adobe’s Profit Slips, Targets Trimmed

Adobe Adobe's Profit Slips, Targets TrimmedSoftware company Adobe Systems (NASDAQ:ADBE), best known for programs like PhotoShop and InDesign, saw its profits slip in the second quarter.

Revenue took off thanks to Adobe’s Creative Suite 6 and Creative Cloud subscription sales, increasing from $1.02 billion last year to $1.12 billion, but higher expenses hurt the company.

For the quarter, Adobe only earned $223.9 million compared with earnings of $229.4 million at the same time last year. Both figures came out to EPS of 45 cents; however, ADBE had more shares outstanding in the previous quarter. Adjusted earnings of 60 cents per share were a cent better than analysts polled by Thomson Reuters expected.

Adobe also adjusted its forecast for the remainder of the year. Shares of Adobe have dropped more than 3% throughout the day, possibly in response to the poor outlook.

The company trimmed its targets for the upcoming third quarter, with projected revenue now coming in at $1.075 billion to $1.125 billion, or 56 to 61 cents per share. Analysts had been looking at the upper end of that estimate, 61 cents per share, on revenue of $1.134 billion.

The full-year earnings outlook was narrowed to a range of $2.40 to $2.46 per share from its prior range of $2.38 to $2.48, while Adobe’s revenue growth target is now a range of 6% to 7% as opposed to the previous range of 6% to 8%.


Article printed from InvestorPlace Media, http://investorplace.com/2012/06/adobes-profit-slips-targets-trimmed/.

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