Somebody tell Adobe they’re not supposed to be doing so well. Don’t they know that tech companies are seeing a downturn?
Adobe reported financial results for its first quarter ended March 2, 2001, and it achieved revenue of US$329 million, compared to $282.2 million reported for the first quarter of fiscal 2000 and $355.2 million reported in the fourth quarter of fiscal 2000. This represents 17 percent year over year revenue growth, with application revenue growth of 20 percent.
“We are pleased to report excellent year over year pro forma operating profit growth of 33 percent and solid year over year revenue growth of 17 percent in a difficult economic environment,” said Bruce R. Chizen, president and chief executive officer, in a statement. “Although we are disappointed in not meeting our original revenue target, we did demonstrate our ability to proactively manage our business,” added Chizen.
Net income, which includes non-operating gains and losses, was $69.8 million for the first quarter of fiscal 2001, compared to $64.6 million reported in the first quarter of fiscal 2000, and $79.2 million in the fourth quarter of fiscal 2000. Excluding the amortization of goodwill, restructuring and other charges, and the write-off of in-process research and development, Adobe’s operating profit was $119 million in the first quarter of fiscal 2001, compared to $89.5 million in the first quarter of fiscal 2000 and $127.5 million in the fourth quarter of fiscal 2000. This represents 33 percent year-over-year operating profit growth. As a percent of revenue, operating profit for the first quarter was 36.2 percent, compared to 31.7 percent in the first quarter of fiscal 2000 and 35.9 percent in the fourth quarter of fiscal 2000.
Not surprisingly, Adobe also announced that, “due to the challenging and uncertain economic environment,” it’s adjusting its fiscal 2001 operating model targets. The company is lowering its second quarter fiscal 2001 year-over-year revenue growth target to approximately 15 percent.
“As we look out further, economic conditions become more challenging to gauge,” Chizen said. “Although we do not currently see a major slowdown in our business in Europe and Japan, the potential for a global slowdown causes us to defer providing updated second half targets until we have better visibility. Notwithstanding the economic environment, we will continue to focus on operational excellence.”