Adobe Profit Tops Expectations on Revenue Growth

By Chelsey Dulaney 

Adobe Systems Inc. on Thursday said profit more than doubled in its fourth quarter, driven by lower restructuring charges and higher digital-media revenue.

Shares of Adobe added 4.8% to $93.20 a share in after-hours trading.

Adobe, famous for its publishing software like Photoshop that is widely used by creative types, as well as popular Flash software, has benefited recently from higher digital-media revenue.

In the latest quarter, digital media annualized recurring revenue, a key metric Adobe uses to calculate how much it makes from subscriptions, grew about 13% to $2.99 billion on the addition of 833,000 net new Creative Cloud subscriptions.

In all, for the quarter ended Nov. 27, Adobe reported a profit of $222.7 million, or 44 cents a share, up from $88.1 million, or 17 cents a share, a year earlier.

Excluding stock-based compensation and other items, profit was 62 cents a share. Revenue jumped 22% to $1.31 billion.

Analysts had forecast 60 cents a share in adjusted earnings on $1.31 billion in revenue.

Profit in the quarter was helped by lower restructuring charges, which dropped to $521,000 from $19.4 million a year earlier.

Operating expenses edged up 3.4% in the quarter.

Gross margin narrowed slightly to 84.6% from 85% a year earlier. Deferred revenue hit a record $1.49 billion.

Write to Chelsey Dulaney at [e-mail]

(END) Dow Jones Newswires

December 10, 2015 16:44 ET (21:44 GMT)

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