Adobe reported strong earnings but shares fell due to disappointing revenue outlook for fiscal 2025.

From Nasdaq: 2024-12-12 09:19:00

Adobe (ADBE) reported fourth-quarter fiscal 2024 non-GAAP earnings of $4.81 per share, beating estimates by 3.22% and increasing 12.6% year over year. Total revenues were $5.61 billion, up 11.1% year over year. ADBE shares dropped over 10% due to a less exciting revenue outlook for fiscal 2025.

Subscription revenues accounted for 95.7% of total revenues, digital media revenues were up 12%, and digital experience revenues increased 10% year over year. Adobe saw strong adoption of its Creative Cloud and Document Cloud offerings, with significant growth in student and business users.

Adobe’s Q1 and FY25 outlook disappointed investors, with total revenues expected between $5.63 billion and $5.68 billion for Q1 and between $23.30 billion and $23.55 billion for FY25. The company expects digital media revenues to grow between $17.25 billion and $17.40 billion in FY25.

Adobe’s operating margin was 46.3% in Q4, and the company’s balance sheet remains strong with cash and short-term investments totaling $7.89 billion. Adobe repurchased 4.6 million shares in the fiscal fourth quarter.

Currently, Adobe carries a Zacks Rank #4 (Sell). The company’s Zacks Top 10 Stocks for 2025 are anticipated to be released on January 2, with a history of strong performance in past years. Adobe’s partnerships with companies like Amazon, Microsoft, and Google are key catalysts for future growth.



Read more at Nasdaq: Adobe Q4 Earnings Beat Estimates, Shares Fall on Weak Outlook