Adobe is changing the world through digital experiences.

Aditya is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

Adobe Systems Inc. (NASDAQ: ADBE) winner 10th annual Adobe Design Achievement Awards (ADAA) is a diversified software company whose main line of operation is software and services used by the professionals and marketers.  It offers professional imaging and video products. Recently its financial results for fourth quarter and fiscal year ended November 29, 2012 was published which reported net revenue of $4.40 billion, EBDIT of $1.47 billion and Diluted EPS of $1.66. The results were quite breath taking.                              

What others are doing

Apple Inc. (NASDAQ: AAPL) a software provider’s results are on hike as compared over last year. For the fiscal year ended 30th November 2012, it reported revenue of $156.51 billion, EBITDA of $58.52B and diluted EPS of $44.15. Revenue is booming and so does it stock price. Adobe Photoshop and photo shop light room compete directly with apple photo graph. Further adobe photograph is able to compete favorable in this area owing to high brand awareness among digital imaging customers & positive impact of the product in market. Adobe is expected to make more money than Apple.

Microsoft Corporation (NASDAQ: MSFT) develops, licenses, and supports software products and services worldwide. They also offer cloud based services. Microsoft Corp's quarterly profit fell greater-than-expected by 22 %, as a result of sales of computers dipping to severe extent due to the weak economy and inability of the latest crop of lightweight laptops to compete with Apple Inc.’s. Both Microsoft and adobe are exploring concept of hybrid technology, which combines power of the desktop with web style multimedia in which adobe holds an upper hand and is a matter of less concern for Adobe in terms of competition. 

Financial interpretation

For the fiscal fourth-quarter the net income fell by more than a third, but revenue rose and results beat Wall Street expectations. Earnings rose by 28% achieved record revenue of $4.404 billion, annual GAAP diluted EPS of $1.66 and annual non GAAP diluted EPS of $2.35. It also booked a pace growth of 25%. The stock also geared up at $37.56 a rise of $2.03 over the previous close. Further Adobe reported operating expenses of $720.7 million were 8.7% lower than the year-ago quarter.

Outlook

Adobe plans to discontinue its authorware software, the visual authorizing tool for creating rich media e- learning. Further Adobe will continue to develop and advance rapid e-learning tools such as Adobe Captivate ad Photoshop Elements and Adobe Premiere Elements software’s. These tools can be used to create engaging eLearning content which can be used everywhere from desktops to mobile phones, and DVD’s to kiosks which will provide much convenience to the end users. All in all Adobe has a bright future ahead as a result of launch of new software’s and is expected to climb its ladder of success. It expects its total earnings to grow by 28%.

Take Away Advice

Strong adoption of Creative Cloud and Adobe Marketing Cloud helped the results even further Adobe’s fourth quarter results are quite impressive, as both earnings and revenues have shown increments in comparison to the prior year figures. Moreover the company has announced that its Board of Directors have approved a new stock repurchase program granting the company authority to repurchase up to $2.0 billion in common stock till the end of fiscal 2015. This will help to return value to Adobe’s stockholders and minimize dilution from stock issuances. Therefore as per me adobe should be bought for long term.

 


adityamanpuria has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple and Microsoft. Motley Fool newsletter services recommend Apple, Adobe Systems, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!

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