Adobe weaker guidance offsets better-than-expected Q3 results; shares plunge 10%
Investing.com - Adobe reported Thursday fiscal third-quarter results that beat analysts' forecasts, but guidance for the current quarter fell short of estimates.
Adobe Systems Incorporated (NASDAQ:ADBE) shares fell 9.6% in after-hours trade following the report.
Adobe announced earnings per share of $4.65 on revenue of $5.41 billion. Analysts polled by Investing.com anticipated EPS of $4.53 on revenue of $5.37B.
New digital media annualized recurring revenue was $504M.
"Clearly the disappointment has to do with the ~$550mn F4Q guide, which given the continued strong momentum in Document Cloud delivering +25% growth, infers Creative Cloud ARR growth of ~11.5% in F4Q, or a point below the ~12.5% seen in F2Q/F3Q," Evercore ISI analysts said in a flash note.
The company guided Q4 earnings of $4.63 to $4.68, or $4.66 at the midpoint on revenue of $5.50B to $5.55B, or $5.53B at the midpoint, missing consensus estimates of $4.67 a share and revenue of $5.60B, respectively.
Digital media net new ARR is expected to come in at about $550M in Q4.
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