December 16, 2016 / 5:58 AM / a year ago

Adobe revenue beats on creative cloud unit strength

REUTERS - Adobe Systems Inc reported better-than-expected quarterly revenue driven by higher demand for its creative cloud business including Photoshop, Illustrator and InDesign.

Adobe company logos are seen in this picture illustration taken in Vienna July 9, 2013. Picture taken July 9, 2013. REUTERS/Leonhard Foeger/File Photo

Revenue from the company’s creative cloud unit, its largest business by revenue, rose 33 percent to $886 million.

Annualized recurring revenue, which is used to track the performance of the company’s subscriptions, rose to $4.01 billion, up from $3.70 billion in the prior quarter above analysts’ estimate of $3.97 billion, according to FactSet StreetAccount.

Adobe has posted double-digit revenue growth in the last six quarters driven by the shift over the past few years to selling software on a subscription basis.

The company also forecast first-quarter revenue of $1.63 billion below average analysts’ estimate of $1.65 billion according to Thomson Reuters I/B/E/S.

The California-based company’s net income rose to $399.6 million, or 80 cents per share, in the fourth quarter ended Dec. 2, from $222.7 million, or 44 cents per share, a year earlier.

Total revenue rose 23.1 percent to $1.61 billion, beating estimates of $1.59 billion. Excluding items, Adobe earned 90 cents per share, beating estimates of 86 cents.

Reporting by Laharee Chatterjee in Bengaluru; Editing by Shounak Dasgupta

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