Skip to main content

Adobe Systems' Outlook Disappointing

The publishing software maker's revenue rises, but shares fall after hours.

Boosted by recently acquired



Adobe Systems

(ADBE) - Get Adobe Inc. Report

recorded surging sales in its first quarter, topping analysts' estimates.

But the company offered a disappointing revenue outlook for its current quarter and cautioned investors that earnings may also come in lower than the Street's expectations.

Scroll to Continue

TheStreet Recommends

Investors reacted negatively on the news. In recent after-hours trading, Adobe shares were off $1.38, or 3.8%, to $35.24.

In the quarter ended March 3, Adobe earned $105.1 million, or 17 cents a share. Thanks to amortization, restructuring and other charges related to its purchase of Macromedia, that result was down from the year-ago period, when Adobe earned $151.9 million, or 30 cents a share.

Revenue rose 39% year over year to $655.5 million.

Excluding those merger-related expenses and charges related to employee stock options, Adobe would have earned $197.5 million, or 32 cents a share.

Analysts polled by Thomson First Call were expecting the company to post pro forma earnings of 29 cents a share for the first quarter on $650.3 million in sales. Adobe officials had predicted earnings of 13 cents to 16 cents -- 28 cents to 30 cents a share excluding charges -- on sales ranging from $630 million to $660 million.

Looking forward, Adobe expects to earn 18 cents to 21 cents a share in the current quarter -- 30 cents to 32 cents a share excluding charges -- on sales of between $640 million and $670 million.

Wall Street had forecast that Adobe would earn 32 cents a share sans charges in the second quarter on $675.7 million in sales.

Adobe's stock closed regular trading on Wednesday up 27 cents, or about 1%, to $36.62.