We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Will Digital Media Strength Aid Adobe's (ADBE) Q4 Earnings?
Read MoreHide Full Article
Adobe’s (ADBE - Free Report) fourth-quarter fiscal 2022 results, which are scheduled to be released on Dec 15, are likely to reflect its Digital Media segment’s strength.
Digital Media has been the key driver behind the company’s growth on the back of its Creative family of products and Document Services products.
With its robust Digital Media solutions, the company helps content creators, app and game developers and creative professionals such as graphic designers, photographers and video editors to generate, publish and promote their content anywhere.
We believe that the company’s persistent efforts toward strengthening its content management capabilities are expected to continue driving growth in the Digital Media segment.
Notably, the segment under discussion generated revenues of $3.23 billion in third-quarter fiscal 2022, which improved 13% on a year-over-year basis.
For fourth-quarter fiscal 2022, Adobe expects year-over-year revenue growth of 10% for Digital Media. The Zacks Consensus Estimate for Digital Media revenues for the quarter under review is pegged at $3.204 billion, suggesting a 6.5% rise from the year-ago quarter’s reported figure.
Click here to know how the company’s overall fiscal fourth-quarter results are likely to be.
Factors to Consider
Solid momentum across Adobe Creative Cloud and Document Cloud is expected to have driven top line growth for the Digital Media segment in the to-be-reported quarter.
Positive contributions from the acquisition of a cloud-enabled video review and collaboration platform named Frame.io are likely to have continued aiding the segment’s performance. In the quarter under review, the company made Frame.io’s video collaboration platform available for Creative Cloud users.
Apart from this, the growing monthly active user base of Creative Cloud Express and the new AI-powered innovations in Premiere Pro, which help to merge music into videos and accelerate transcription, are expected to have accelerated growth in Creative revenues in the quarter under review. The rising proliferation of Metaverse is also likely to have aided the performance of Creative Cloud.
Notably, the Zacks Consensus Estimate for fiscal fourth-quarter Creative Cloud revenues is pegged at $2.87 billion, suggesting an improvement of 15.7% from the year-ago quarter’s reported figure.
A spike in searches for document actions is likely to have benefited Acrobat Web. The new sign integration with Adobe Commerce and Workfront and the signature feature in Acrobat are expected to have aided the adoption of Adobe Sign. Strong momentum for Acrobat PDFs on mobile is expected to have been beneficial. The robust Document Cloud enterprise business is likely to have been another positive. All these are anticipated to have contributed well to Document Cloud revenues.
The Zacks Consensus Estimate for fiscal fourth-quarter Document Cloud revenues is pegged at $604 million, indicating an improvement of 13.5% from the year-ago quarter’s reported figure.
The above-mentioned factors are expected to have contributed well to Creative annualized recurring revenues (ARR) and Document Cloud ARR, which, in turn, are anticipated to have driven growth in Digital Media ARR in the to-be-reported quarter.
Notably, Adobe’s projection for fiscal fourth-quarter Digital Media ARR is pegged at $550 million of net new ARR.
The Zacks Consensus Estimate for total Digital Media ARR is pegged at $13.95 billion, indicating year-over-year growth of 14.8%.
However, the ongoing tensions between Russia and Ukraine are anticipated to have affected Digital Media ARR in the fiscal fourth quarter.
Zacks Rank & Stocks to Consider
Currently, Adobe carries a Zacks Rank #3 (Hold).
Investors interested in the broader Zacks Computer & Technology sector can consider some better-ranked stocks like Arista Networks (ANET - Free Report) , Asure Software (ASUR - Free Report) and Airbnb (ABNB - Free Report) . While Arista Networks and Asure Software sport a Zacks Rank #1 (Strong Buy), Airbnb carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Arista Networks has lost 8.9% in the year-to-date period. The long-term earnings growth rate for ANET is currently projected at 17.5%.
Airbnb has lost 42.6% in the year-to-date period. ABNB’s long-term earnings growth rate is currently projected at 20.7%.
Asure Software has gained 3.7% in the year-to-date period. The long-term earnings growth rate for ASUR is currently projected at 23%.
Image: Bigstock
Will Digital Media Strength Aid Adobe's (ADBE) Q4 Earnings?
Adobe’s (ADBE - Free Report) fourth-quarter fiscal 2022 results, which are scheduled to be released on Dec 15, are likely to reflect its Digital Media segment’s strength.
Digital Media has been the key driver behind the company’s growth on the back of its Creative family of products and Document Services products.
With its robust Digital Media solutions, the company helps content creators, app and game developers and creative professionals such as graphic designers, photographers and video editors to generate, publish and promote their content anywhere.
We believe that the company’s persistent efforts toward strengthening its content management capabilities are expected to continue driving growth in the Digital Media segment.
Notably, the segment under discussion generated revenues of $3.23 billion in third-quarter fiscal 2022, which improved 13% on a year-over-year basis.
For fourth-quarter fiscal 2022, Adobe expects year-over-year revenue growth of 10% for Digital Media. The Zacks Consensus Estimate for Digital Media revenues for the quarter under review is pegged at $3.204 billion, suggesting a 6.5% rise from the year-ago quarter’s reported figure.
Click here to know how the company’s overall fiscal fourth-quarter results are likely to be.
Factors to Consider
Solid momentum across Adobe Creative Cloud and Document Cloud is expected to have driven top line growth for the Digital Media segment in the to-be-reported quarter.
Positive contributions from the acquisition of a cloud-enabled video review and collaboration platform named Frame.io are likely to have continued aiding the segment’s performance. In the quarter under review, the company made Frame.io’s video collaboration platform available for Creative Cloud users.
Apart from this, the growing monthly active user base of Creative Cloud Express and the new AI-powered innovations in Premiere Pro, which help to merge music into videos and accelerate transcription, are expected to have accelerated growth in Creative revenues in the quarter under review. The rising proliferation of Metaverse is also likely to have aided the performance of Creative Cloud.
Notably, the Zacks Consensus Estimate for fiscal fourth-quarter Creative Cloud revenues is pegged at $2.87 billion, suggesting an improvement of 15.7% from the year-ago quarter’s reported figure.
A spike in searches for document actions is likely to have benefited Acrobat Web. The new sign integration with Adobe Commerce and Workfront and the signature feature in Acrobat are expected to have aided the adoption of Adobe Sign. Strong momentum for Acrobat PDFs on mobile is expected to have been beneficial. The robust Document Cloud enterprise business is likely to have been another positive. All these are anticipated to have contributed well to Document Cloud revenues.
The Zacks Consensus Estimate for fiscal fourth-quarter Document Cloud revenues is pegged at $604 million, indicating an improvement of 13.5% from the year-ago quarter’s reported figure.
The above-mentioned factors are expected to have contributed well to Creative annualized recurring revenues (ARR) and Document Cloud ARR, which, in turn, are anticipated to have driven growth in Digital Media ARR in the to-be-reported quarter.
Notably, Adobe’s projection for fiscal fourth-quarter Digital Media ARR is pegged at $550 million of net new ARR.
The Zacks Consensus Estimate for total Digital Media ARR is pegged at $13.95 billion, indicating year-over-year growth of 14.8%.
However, the ongoing tensions between Russia and Ukraine are anticipated to have affected Digital Media ARR in the fiscal fourth quarter.
Zacks Rank & Stocks to Consider
Currently, Adobe carries a Zacks Rank #3 (Hold).
Investors interested in the broader Zacks Computer & Technology sector can consider some better-ranked stocks like Arista Networks (ANET - Free Report) , Asure Software (ASUR - Free Report) and Airbnb (ABNB - Free Report) . While Arista Networks and Asure Software sport a Zacks Rank #1 (Strong Buy), Airbnb carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Arista Networks has lost 8.9% in the year-to-date period. The long-term earnings growth rate for ANET is currently projected at 17.5%.
Airbnb has lost 42.6% in the year-to-date period. ABNB’s long-term earnings growth rate is currently projected at 20.7%.
Asure Software has gained 3.7% in the year-to-date period. The long-term earnings growth rate for ASUR is currently projected at 23%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.