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Evercore ISI: Adobe's (ADBE) F3Q Results Were 'Actually Quite Strong'

Adobe's Earnings Report Analysis

Evercore ISI analyst Kirk Materne maintained an Outperform rating on Adobe (ADBE) shares but lowered the price target to $415 from $430 following the company's F3Q results.

Materne said the results were “actually quite strong” with “resilient” demand across the entire portfolio. He noted that the Digital Media segment was particularly strong, with strength in Creative Cloud and Document Cloud.

Key Findings

Materne highlighted several key findings from the report:

• Total revenue grew 13% year-over-year to $4.43 billion, in line with estimates.
• Digital Media revenue grew 15% year-over-year to $3.46 billion.
• Creative Cloud revenue grew 17% year-over-year to $2.93 billion.
• Document Cloud revenue grew 10% year-over-year to $1.15 billion.
• Digital Experience revenue grew 10% year-over-year to $1.02 billion.
• Non-GAAP earnings per share were $3.40, in line with estimates.

Outlook

Materne said he is “encouraged” by Adobe's outlook for the rest of the year. He noted that the company raised its guidance for the year, which now calls for revenue growth of 12%-13% and non-GAAP EPS growth of 10%-12%.

Overall, Materne said he remains “positive” on Adobe's long-term prospects. He said the company is “well-positioned” to benefit from the continued growth of the digital economy.

Source: Seeking Alpha