Adobe -- still the dominant leader in the multimedia software market -- has been working to transform its business from the traditional "software sold in a box" to an online/cloud subscription-based model. So far the transition has gone well.
On Tuesday, the company will report results for its second quarter, and investors will be watching closely to see if the company can continue its momentum after a strong start to the year. The stock, trading at around $43, is up 25% so far this year.
Given the early struggles that Microsoft (MSFT) experienced with its Office 360 subscription, analysts had doubts that Adobe would make its transition as well as it has.Microsoft was looking for a cloud-based subscription model to save on distribution costs and make it easier for users to update their software. Likewise, Adobe saw this conversion as inevitable. The only question was how long the transition would take. Not only have customers responded favorably to the subscription model, but management's acrobatic moves have brought new life to Adobe's Creative Suite franchise, which added 153,000 Creative Cloud service customers in the first quarter.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV