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Adobe Systems (ADBE) - Get Adobe Inc. Report shares traded higher Wednesday after the cloud computing and software group posted stronger-than-expected second quarter earnings and boosted its near-term profit outlook following a partnership agreement with Microsoft (MSFT) - Get Microsoft Corporation Report .

Adobe said non-GAAP earnings for the three months ending in May, the company's fiscal second quarter, came in at $1.83 per share, up 10.2% from the same period last year and 5 cents ahead of the Street consensus forecast. Group sales, Adobe said, rose 25% to a record $2,744 billion, narrowing topping analysts' forecasts, as cloud subscription revenues rose 27% to $2.46 billion and digital media sales rose 22% to $1.89 billion.

Looking into 2019, Adobe said it sees current quarter revenues of $2.8 billion, modestly shy of the Refinitv forecast of $2.83 billion, and non-GAAP earnings of $1.95 per share, a 12.7% improvement from the same period last year.

"The depth and breadth of our enterprise partner ecosystem remains a competitive advantage contributing to pipeline generation, customer success as well as financial performance," CFO John Murphy told investors on a conference call late Tuesday. "We had another successful quarter of selling alongside Microsoft, where our combined value proposition is resonating with enterprise customers. told investors on a conference call late Tuesday."

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"We are pleased with our first half performance and we expect our first half momentum to continue in the second half, with typical seasonality in Q3 and strength in Q4," he added. "We continue to expect sequential operating margin growth as we move through the second half of the year."

Adobe shares were marked 3% higher at the start of trading Wednesday to change hands at $284.93 each, a move that would extend the stock's year-to-date gain to around 27% and value the San Jose, California maker of Photoshop at around $140 billion.

Adobe closed its $4.75 billion acquisition of Marketo, a business-to-business marketing applications group from private equity investors Vista Equity on October 31. It also bought Magento Commerce from Permira, another private equity group, for $1.7 billion in May of last year, with both contributing to the group's top and bottom lines over the second quarter.

"Adobe's business had another good quarter with F2Q results mostly ahead of consensus estimates, though management didn't raise guidance, making this fiscal year more seasonal," said Oppenheimer analyst Brian Schwartz, who carries a 'market perform' rating on the stock.

"Positively, the company beat on operating margin, a good data point suggesting that management is effectively integrating the operations of Marketo and Magento, and supports the EPS power story," he added. "In addition, the numbers look set appropriately to mitigate estimate risks. On balance, guidance implies the resumption of operating margin growth is not expected until after the company anniversaries the Marketo deal in F4Q."