Adobe Stock Dives on Disappointing Outlook
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Key TakeawaysAdobe reported fiscal third-quarter earnings and revenue that topped expectations.However, its outlook for the fourth quarter missed analysts' estimates.Adobe shares tumbled in extended trading Thursday following the company's earnings release.
Adobe (ADBE) shares tumbled in extended trading Thursday after the company’s fiscal fourth-quarter outlook fell short of analysts' expectations.The software company said it anticipates revenue of between $5.50 billion and $5.55 billion for the fourth quarter, below estimates compiled by Visible Alpha. It projected diluted earnings per share (EPS) of $3.58 to $3.63, with analysts expecting the higher end of that range. Outlook Overshadows Strong Q3 ResultsAdobe's weaker-than-expected outlook overshadowed an otherwise strong report, with third-quarter results that topped estimates. Adobe posted third-quarter revenue of $5.41 billion, an 11% jump year-over-year, and EPS of $3.76, up from $3.05 a year earlier.Adobe’s Digital Media arm, which includes Creative Cloud subscriptions, posted record net-new annualized recurring revenue (ARR) of $504 million, an 8% year-over-year rise and also above analysts' projections."Adobe's record Q3 performance is a testament to our relentless innovation and commitment to delivering value to our customers,” Adobe CEO Shantanu Narayen said in a release, noting Adobe's “advancements in AI across Creative Cloud, Document Cloud and Experience Cloud.”Adobe shares fell more than 9% in extended trading Thursday following the company's earnings report. Read the original article on Investopedia.
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