Adobe beats estimates and reaches $5 billion quarterly revenue for the first time

US software giant, Adobe Inc. (NASDAQ: ADBE), reported Q4 and fiscal year 2023 financial results after the market close in the US on Wednesday.

Company overview

• Founded: December 1982
• Headquarters: San Jose, California, United States
• Number of employees: 26,000 (2022)
• Industry: Software
• Key people: Shantanu Narayen (Chairman & CEO)

The results

Revenue reported $5.048 billion for Q4 and reached $5 billion mark for the first time (up by 12% year-over-year) vs. $5.014 billion estimate.

Earnings per share (EPS) reported at $4.27 per share vs. $4.134 per share expected.

Fiscal year 2023 revenue reached a new record of $19.41 billion – a new record and an increase of 10% year-over-year. EPS reported at $16.07 per share, up by 17% from the year prior.

Adobe expects revenue to reach between $5.10 to $5.15 billion in first quarter of fiscal year 2024, which would fall below analyst estimate of $5.16 billion.

CEO commentary

”Adobe drove record revenue of $19.41 billion in FY23 and 17 percent year-over-year EPS growth, with strong momentum across Creative Cloud, Document Cloud and Experience Cloud. Adobe’s strategy, category leadership, ground-breaking innovation, exceptional talent and global customer base position us well for 2024 and beyond,” Shantanu Narayen, CEO of Adobe said in a letter to investors.

Stock reaction

The stock was down by 1.48% at the end of Tuesday, trading at $624.26 a share.

Share price fell by around 6% in the after-hours trading after the release of the latest results as future guidance fell short of estimates.

Stock performance

• 1 month: +6.44%
• 3 months: +14.47%
• Year-to-date: +88.29%
• 1 year: +86.41%

Adobe stock price targets

• Citigroup: $675
• BMO Capital Markets: $690
• KGI Securities: $730
• Piper Sandler: $650
• DA Davidson: $640
• Oppenheimer: $660
• HSBC: $519
• Barclays: $640
• Bank of America: $660

Adobe Inc. is the 28th largest company in the world with a market cap of $288.50 billion.

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Sources: Adobe Inc., TradingView, MarketWatch, MarketBeat, CompaniesMarketCap