CS3, Acrobat push Adobe to strong finish for fiscal 2007
Software maker Adobe reported a strong financial finish to its 2007 fiscal year, with revenue up 23 percent for the year and 34 percent for the fourth quarter on sales of its Creative Suite 3 and Acrobat software, the company said Monday.
For its fourth quarter ended Nov. 30, Adobe reported record revenue for a three-month period of $911.2 million, compared with $682.2 million for the same time period last year. Revenue beat estimates from analysts polled by Thomson First Call, who were expecting the company to bring in $837 million in the quarter.
For the fiscal year ended at the same time, Adobe reported revenue of $3.16 billion, also a record for the company, compared with $2.58 billion last year. Adobe’s net income for the quarter was $222.2 million, a 21 percent increase over the $183.2 million reported in the fourth quarter of fiscal 2006. For the year, net income was up 43 percent at $723.8 million, compared with $505.8 million in fiscal 2006.
Diluted earnings per share (EPS) for the fourth quarter of fiscal 2007 were 38 cents slightly above the company’s own range of 35 to 37 cents, and a 27 percent increase over diluted EPS of 30 cents for the same period last year. Diluted EPS for the year was $1.21, a 46 percent increase over EPS of 83 cents in 2006.
A strong end to fiscal 2007 is fitting for what turned out to be a banner year for the publishing and design software vendor. The company released CS3, a combination of its own graphics creation products and Web design and multimedia tools that it acquired from Macromedia. It is the first real blend of the two companies’ complementary technologies in one suite.
CS3 so far has been well-received by the creative Web and production design community that has been loyal to both Adobe and the former Macromedia for years, making Adobe the leader among those customers. However, this position also inspired more competition in 2007, most notably from software giant Microsoft, which came out with its Windows-only Expression suite to rival CS3, as well as new cross-browser software called Silverlight to compete with Adobe’s ubiquitous Flash multimedia technology.
2007 also saw longtime Adobe CEO Bruce Chizen step down at the end of the fiscal year. He made the move as part of a planned transition and so he could pursue other career endeavors. Shantanu Narayen, former president and COO, is now chairman and CEO of the company.
Adobe on Monday also provided estimates for its first quarter of fiscal 2008, which ends in February. The company expects revenue between $855 million and $885 million and EPS between 34 cents and 36 cents for the quarter. For fiscal 2008, the company reiterated its target annual revenue growth rate of about 13 percent, which it previously announced.