Adobe Catches a Bid

Updated from Oct. 26

Adobe Systems(ADBE) was higher Wednesday in premarket trading after the software maker raised its fourth-quarter guidance and said fiscal 2005 sales should exceed current analysts' estimates.

The stock was recently up 78 cents, or 1.5%, to $54.50 on Instinet.

San Jose, Calif.-based Adobe raised its fourth-quarter revenue target to a range of $410 million to $425 million from a previous range of $400 million to $415 million. The software maker also said it now expects fourth-quarter earnings of 40 cents to 43 cents a share, up from a previous targeted range of 38 cents to 41 cents a share.

Analysts surveyed by Thomson First Call were expecting Adobe to earn 40 cents a share on $410.7 million in revenue in the fourth quarter, which ends Dec. 3.

Adobe attributed the stronger results to sales of its Creative Suite products and Acrobat product family, with strong demand in its U.S. and European markets.

For fiscal 2005, Adobe said it expects revenue to range from $1.85 billion to $1.9 billion, with an operating margin ranging from 34% to 35%. That exceeds the current consensus estimate calling for fiscal year 2005 revenue of $1.81 billion. Analysts were forecasting 2005 earnings of $1.89 a share.

"We anticipate fiscal 2005 to be our third consecutive year of double-digit growth," CEO Bruce Chizen said in a statement.

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