Adobe Inc. (NASDAQ:ADBE) shares are trading lower Friday. The company reported its fourth-quarter results on Wednesday. Here's what you need to know.
What To Know: On Wednesday, Adobe reported fourth-quarter revenue of $5.61 billion, beating the $5.54 billion consensus. Adjusted earnings were $4.81 per share, above the $4.66 estimate. This marks Adobe's eighth consecutive quarter of beating expectations. Total revenue grew 11% year-over-year, with Digital Media and Digital Experience revenues up 12% and 10%, respectively. Remaining performance obligations (RPO) rose 16% to $19.96 billion. Operating cash flow was $2.92 billion and 4.6 million shares were repurchased during the quarter according to Benzinga Pro.
CEO Shantanu Narayen highlighted record fiscal 2024 revenue and the importance of Adobe's cloud platforms in the AI economy.
Guidance: Revenue is projected between $23.3 billion and $23.55 billion, below the $23.79 billion consensus. Adjusted earnings per share are expected to range from $20.20 to $20.50, slightly below the $20.55 estimate. First-quarter revenue guidance of $5.63 billion to $5.68 billion also missed the $5.73 billion consensus. Management pointed to lower pricing benefits, delayed monetization of generative AI solutions and foreign exchange headwinds as factors weighing on growth.
Analysts Ratings:
- Piper Sandler: Brent Bracelin maintained an Overweight rating but lowered the price target from $635 to $600.
- Oppenheimer: Brian Schwartz reiterated an Outperform rating with a reduced price target of $600.
- Goldman Sachs: Kash Rangan reaffirmed a Buy rating and $640 price target.
- KeyBanc Capital Markets: Jackson Ader maintained an Underweight rating and $450 price target.
- RBC Capital Markets: Matthew Swanson lowered the price target from $610 to $590 while maintaining an Outperform rating.
- UBS: Reduced its price target to $525 with a Neutral rating.
- Barclays: Adjusted its price target to $645, maintaining an Overweight rating.
- Bernstein: Cut its price target to $587, reiterating an Outperform rating.
- DA Davidson: Revised its target to $625 while retaining a Buy rating.
ADBE Price Action: Adobe shares were down 3.47% at $458.18 at the time of writing, according to Benzinga Pro.
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