Adobe (ADBE) Last Update 6/17/24
Related: MSFT ORCL SAP CRM
% of Stock Price
Revenue
Gross Profits
Free Cash Flow
Adobe
$600.58
Yours
Trefis Price
N/A
$566
Market
 
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TREFIS Analysis


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RECENT NEWS AND ANALYSIS

Potential upside & downside to trefis price

Adobe Company

VALUATION HIGHLIGHTS

  1. Digital Media constitutes 79% of the Trefis price estimate for Adobe's stock.
  2. Digital Experience constitutes 19% of the Trefis price estimate for Adobe's stock.

WHAT HAS CHANGED?

Latest Earnings

Adobe reported Q2 FY 2024 results with revenue at $5.31 billion, up 10% y-o-y. Diluted earnings per share were $3.49 on a GAAP basis compared to $2.82 in the same period of the previous year. Note: Adobe's FY'23 ended on December 1, 2023. Q2 FY'24 refers to the quarter that ended on May 31, 2024.

Coronavirus and Oil Price war

IT software and Services industries suffered from a fall in demand for software and web services at the start of the pandemic as consumers focused solely on essentials, not discretionary products. However, it recovered over the subsequent quarters, with companies having a portfolio of software and services aimed at remote collaboration benefitting the most. Adobe has delivered good results amid the pandemic as there is a shift towards digitalization.

Launch of the Adobe Experience Platform

The launch of the ability to create real-time customer profiles to deliver personalized experiences is also likely to give a fillip to the company's revenues. Notably, Adobe's ecosystem of partners (especially Microsoft, SAP, and Amazon) is likely to deepen Adobe's competitive moat further.

Lastly, the Adobe Experience Platform can create a real-time user profile to help target users across channels they use to engage with Adobe.

Considering that the company processes hundreds of trillions of transactions annually, one can only imagine the scale and efficacy of insights that can be generated and how the effectiveness is likely to get further amplified across Adobe's partner ecosystem.

  • Digital Media Revenues: Digital Media (DM) is Adobe's new segment housing its creative cloud (CC) and document cloud revenue.
  • Digital Experience: Over the past few years, Adobe has built a comprehensive digital marketing platform that addresses most of the needs of digital marketers. The company has scaled up the functionality and product offering of its marketing platform through organic and inorganic growth.

For additional details, select a driver above or select a division from the interactive Trefis split for Adobe at the top of the page.

BUSINESS SUMMARY

Although Adobe is commonly known for its widely distributed free Acrobat PDF Reader, the company makes money primarily by serving "creative professionals" with the software used in image manipulation, animation, web design, and the creation of interactive media content. Adobe's Photoshop, Dreamweaver, Flash, and InDesign products are some of the better-known creative software suites used by graphic designers, production artists, web designers, photographers, animators, publishers, and writers.