Adobe Profit Rises Sharply

Adobe Systems Inc.'s third-quarter profit rose sharply on a double-digit revenue increase, driven by digital cloud revenue business.

Digital media annualized recurring revenue, a key metric Adobe uses to calculate how much it makes from subscriptions, rose to $2.65 billion from $2.35 billion in the previous quarter.

The San Jose, Calif., company had projected $2.93 billion in recurring revenue for the year, adjusting for currency fluctuations.

More than 40% of Adobe's revenue comes from outside the U.S.

Adobe, founded in 1982, hasn't paid a dividend since 2005, opting instead for share buybacks as a way to pass on some of its cash to shareholders. In the latest period, it retired about 1.6 million shares.

Over all, for the period ended Aug. 28, Adobe reported a profit of $174.5 million, or 34 cents a share, up from $44.7 million, or nine cents a share, a year earlier. Excluding stock-based compensation and other items, profit rose to 54 cents from 28 cents.

Revenue rose 21% to $1.22 billion.

Adobe had projected a profit of 45 cents to 51 cents a share on $1.18 billion to $1.23 billion in revenue.

Gross margin remained largely flat at 84.3%.

Deferred revenue, meanwhile, rose nearly 15% to $1.26 billion.

Shares closed Thursday at $80.31, up 10% for the year.

Write to Maria Armental at [e-mail]

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(END) Dow Jones Newswires

September 17, 2015 17:05 ET (21:05 GMT)

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