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Adobe (ADBE) to Report Q1 Earnings: What's in the Offing?
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Adobe Inc. (ADBE - Free Report) is set to report first-quarter fiscal 2024 results on Mar 14.
For the fiscal first quarter, the company expects non-GAAP earnings of $5.10-$5.15 per share. The Zacks Consensus Estimate for earnings is pegged at $5.13 per share, indicating growth of 10.3% from the year-ago reported figure.
Adobe projects total revenues between $4.35 billion and $4.40 billion. The consensus mark for the same is pegged at $4.38 billion, implying growth of 15.3% from the year-ago reported figure.
The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average earnings surprise being 3.42%.
Solid momentum across the Digital Media and Digital Experience segments is likely to have driven top-line growth for the company in the to-be-reported quarter.
Robust Creative Cloud and Document Cloud are expected to have contributed well to the performance of the Digital Media segment in the fiscal first quarter. Adobe expects Digital Media revenues between $3.77 and $3.80 billion. The Zacks Consensus Estimate for the same is pegged at $3.78 billion, indicating year-over-year growth of 11.5%.
Growing momentum across the Adobe Express platform and benefits from the Frame.io acquisition are expected to have accelerated growth in Creative revenues in the quarter under review. Also, Adobe’s solid momentum in generative AI on the back of Firefly is likely to have been a major positive.
Strength across the Document Cloud enterprise business and Acrobat ecosystem is anticipated to have contributed well to Document Cloud revenues. The growing demand for PDF collaboration services is expected to have been a tailwind.
Growing Adobe Experience Cloud subscriptions on the heels of the rising adoption of Adobe Marketing Cloud, Adobe Analytics Cloud and Adobe Advertising Cloud is likely to have benefited Adobe’s Digital Experience segment in the quarter under review.
Strong demand for AEP and native apps and solid momentum across Data & Insights, Content and Workfront solutions are anticipated to have benefited the segment’s quarterly performance.
The company expects Digital Experience revenues between $1.27 and $1.29 billion. The Zacks Consensus Estimate for the same is pegged at $1.27 billion, indicating year-over-year growth of 8.2%.
However, the impacts of ongoing tensions between Russia and Ukraine are likely to have continued acting as headwinds in the quarter to be reported.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Adobe this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Adobe has an Earnings ESP of -0.19%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
ADBE currently has a Zacks Rank #2.
Stocks to Consider
Here are some stocks worth considering that, per our model, have the right combination of elements to beat on earnings this reporting cycle.
Image: Shutterstock
Adobe (ADBE) to Report Q1 Earnings: What's in the Offing?
Adobe Inc. (ADBE - Free Report) is set to report first-quarter fiscal 2024 results on Mar 14.
For the fiscal first quarter, the company expects non-GAAP earnings of $5.10-$5.15 per share. The Zacks Consensus Estimate for earnings is pegged at $5.13 per share, indicating growth of 10.3% from the year-ago reported figure.
Adobe projects total revenues between $4.35 billion and $4.40 billion. The consensus mark for the same is pegged at $4.38 billion, implying growth of 15.3% from the year-ago reported figure.
The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average earnings surprise being 3.42%.
Adobe Inc. Price and EPS Surprise
Adobe Inc. price-eps-surprise | Adobe Inc. Quote
Factors to Consider
Solid momentum across the Digital Media and Digital Experience segments is likely to have driven top-line growth for the company in the to-be-reported quarter.
Robust Creative Cloud and Document Cloud are expected to have contributed well to the performance of the Digital Media segment in the fiscal first quarter. Adobe expects Digital Media revenues between $3.77 and $3.80 billion. The Zacks Consensus Estimate for the same is pegged at $3.78 billion, indicating year-over-year growth of 11.5%.
Growing momentum across the Adobe Express platform and benefits from the Frame.io acquisition are expected to have accelerated growth in Creative revenues in the quarter under review. Also, Adobe’s solid momentum in generative AI on the back of Firefly is likely to have been a major positive.
Strength across the Document Cloud enterprise business and Acrobat ecosystem is anticipated to have contributed well to Document Cloud revenues. The growing demand for PDF collaboration services is expected to have been a tailwind.
Growing Adobe Experience Cloud subscriptions on the heels of the rising adoption of Adobe Marketing Cloud, Adobe Analytics Cloud and Adobe Advertising Cloud is likely to have benefited Adobe’s Digital Experience segment in the quarter under review.
Strong demand for AEP and native apps and solid momentum across Data & Insights, Content and Workfront solutions are anticipated to have benefited the segment’s quarterly performance.
The company expects Digital Experience revenues between $1.27 and $1.29 billion. The Zacks Consensus Estimate for the same is pegged at $1.27 billion, indicating year-over-year growth of 8.2%.
However, the impacts of ongoing tensions between Russia and Ukraine are likely to have continued acting as headwinds in the quarter to be reported.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Adobe this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Adobe has an Earnings ESP of -0.19%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
ADBE currently has a Zacks Rank #2.
Stocks to Consider
Here are some stocks worth considering that, per our model, have the right combination of elements to beat on earnings this reporting cycle.
Rekor Systems (REKR - Free Report) has an Earnings ESP of +5.72% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Rekor System’s shares have declined 33% year to date. REKR is set to report its fourth-quarter 2023 results on Mar 25.
ADC Therapeutics (ADCT - Free Report) has an Earnings ESP of +57.5% and a Zacks Rank of 3 at present.
ADC Therapeutics shares have gained 171.1% year to date. ADCT is set to report its fourth-quarter 2023 results on Mar 13.
Alpine Immune Sciences (ALPN - Free Report) has an Earnings ESP of +8.57% and a Zacks Rank #3.
Alpine Immune Sciences shares have returned 88.5% year to date. ALPN is set to release its fourth-quarter fiscal 2023 results on Mar 18.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.