Adobe (ADBE) First Quarter 2024 Earnings Report | Wilnesh News

adobe The design software maker posted strong fiscal first-quarter results that came in slightly short of quarterly revenue guidance, sending its shares tumbling 11% in after-hours trading Thursday.

Here’s how the company performed, compared with estimates from analysts polled by LSEG (formerly Refinitiv):

• Earnings per share: Adjusted $4.48, expected $4.38
• income: $5.18 billion vs. $5.14 billion expected

Adobe’s revenue increased 11% annually in the quarter ended March 1, according to Adobe data statement. Net profit fell to $620 million ($1.36 per share) from $1.25 billion ($2.71 per share) in the same period last year.

This quarter, Adobe abandoned plans to acquire design software startup Figma for $20 billion after U.K. regulators uncovered competition concerns. The company paid Figma a $1 billion termination fee.

Adobe recently released early versions of its artificial intelligence assistant for Reader and Acrobat applications.

Meanwhile, OpenAI released Sora in February, which generates videos based on people’s written descriptions. David Wadhwani, president of Adobe’s digital media business, said on the earnings call that Adobe will work with OpenAI around Sora.

“You’ll see that we’re obviously developing our own model,” he said. “You’ll see other people developing a model. All of this creates tailwinds because the more people who generate video clips, the more they have to edit that content.”

Adobe expects second-quarter adjusted earnings per share of $4.35 to $4.40, on revenue of $5.25 billion to $5.3 billion. The middle of the range implies 9% growth. Analysts polled by London Stock Exchange Group (LSEG) expected earnings of $4.38 per share on revenue of $5.31 billion.

Wadhwani said product enhancements in Adobe Express applications, Firefly Services AI products and the new Acrobat Assistant should lead to accelerated digital media annualized recurring revenue growth in the second half.

The company said it would set aside $25 billion for stock buybacks.

Post-hours action aside, Adobe shares are down 4% year to date, while the S&P 500 is up 8%.