Adobe Systems Incorporated (NASDAQ:ADBE) reported earnings for the three months ended May 2016 on June 21, 2016. The company earned $0.71 per share on revenue of $1.4B. Analysts had been modeling earning per share of $0.68 with $1.4B in revenue.
Adobe Systems Incorporated (NASDAQ:ADBE) reported financial results for its second quarter fiscal year 2016 ended June 3, 2016.
Second Quarter Financial Highlights
- Adobe achieved record quarterly revenue of $1.40 billion, representing year-over-year growth of 20 percent.
- Diluted earnings per share were $0.48 on a GAAP-basis, and $0.71 on a non-GAAP basis.
- Digital Media segment revenue grew by 26 percent year-over-year to a record $943 million, with Creative revenue growing 37 percent year-over-year to a record $755 million.
- Strong Creative Cloud and Document Cloud adoption drove Digital Media Annualized Recurring Revenue (“ARR”) to $3.41 billion exiting the quarter, a quarter-over-quarter increase of $285 million.
- Adobe Marketing Cloud achieved record revenue of $385 million that represents year-over-year growth of 18 percent.
- Year-over-year operating income grew 78 percent and net income grew 66 percent on a GAAP-basis; operating income grew 45 percent and net income grew 48 percent on a non-GAAP basis.
- Cash flow from operations was $489 million, and deferred revenue grew to $1.68 billion.
- The company repurchased approximately 2.2 million shares during the quarter, returning $205 million of cash to stockholders.
A reconciliation between GAAP and non-GAAP results is provided at the end of this press release and on Adobe’s website.
“Adobe’s cloud solutions are powering digital transformation at the world’s biggest brands, educational institutions and government agencies,” said Shantanu Narayen, Adobe president and chief executive officer. “Our record revenue reflects our market leadership and the exploding demand for digital experience solutions.”
“Record revenue with strong profit and cash flow highlight our second quarter results,” said Mark Garrett, Adobe executive vice president and chief financial officer. “Based on our first half performance and momentum, we’re on track to meet or exceed all of our annual fiscal year 2016 targets.”
Adobe Systems Incorporated earnings per share showed an increasing trend of 135.2% for the current fiscal year. The company’s expected EPS growth rate for next fiscal year is 379%.Analysts project EPS growth over the next 5 years at 28.19%. It has EPS annual decline over the past 5 fiscal years of -3.4% when sales grew 4.8. It reported 24.7% sales growth, and 200.7% EPS growth in the last quarter.
The stock is trading at $96.21, up 34.99% from 52-week low of $71.27. The stock trades down -4.33% from its peak of $100.56 and % below the consensus price target of $111.57. Its volume clocked up at 3.8 million shares which is higher than the average volume of 2.65 million shares. Its market capitalization currently stands at $47.02B.