Adobe Systems (NASDAQ: ADBE): Q2 Earnings Preview 2011

Adobe Systems Inc. (NASDAQ: ADBE) is scheduled to release its fiscal seocnd-quarter earnings after the closing bell on Tuesday, June 21, 2011. Analysts, on average, expect the company to report earnings of 51 cents per share on revenue of $994.79 million. In the year ago period, the company reported earnings of 44 cents per share on revenue of $943.04 million.

Adobe Systems Incorporated operates as a diversified software company in the Americas, Europe, the Middle East, Africa, and Asia. It offers a line of creative, business, Web, and mobile software and services used by creative professionals, knowledge workers, consumers, original equipment manufacturers, developers, and enterprises.

In the preceding fiscal-first quarter, the San Jose, California-based company's net income was $234.6 million, or 46 cents per share, compared to $127.2 million, or 24 cents per share, in the year-ago quarter. On an adjusted basis, the company earned 58 cents per share in the first quarter. Revenue jumped 20% to $1.03 billion from $858.70 million in the same quarter last year. Analysts, on average, expected the company to report earnings of 57 per share on revenue of $1.03 billion. 

At its last earnings call in March, Adobe forecast second quarter revenue of $970 million to $1.02 billion, GAAP earnings of 33 cents to 40 cents per share and non-GAAP of 47 cents to 54 cents per share. Operating margin for the second quarter is expected to be 24.5% to 27.5% on GAAP basis and 34% to 36% on a non-GAAP basis. "Given the uncertain business environment in Japan, we are being prudent and have reduced our revenue expectation for our second quarter by $50 million — or roughly one-third of our original Q2 revenue expectation for Japan," said Mark Garrett, executive vice president and CFO of Adobe.

The company recently unveiled the new Creative Suite 5.5 product line, targeting popular and emerging smartphone and tablet platforms. This product family offers significant advances to HTML5, Flash authoring, digital publishing and video tools.

The company's sales have been helped by economic stabilization and recovery in technology market in recent months. Companies are increasing budgets for advertising and marketing materials that can be created with Adobe's software, while worldwide PC sales too have recovered. Adobe released its latest Creative Suite version, CS5, in April 2010. According to Adobe, customer feedback for CS5 continues to be overwhelmingly positive.

However, Adobe Flash is facing an onslaught of up-and-coming alternatives that could threaten the former's dominant status as the defacto rich-media platform online. Apple does not support Flash on its iOS devices, arguing that Adobe's multimedia technology is vulnerable to exploits, consumes too much battery life, and crashes too often. In order to answer Flash critics, Adobe recently released a new tool, codenamed Wallaby, to convert Flash files to HTML5 so that they can run on Apple devices like the iPad and iPhone.

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Adobe Systems (NASDAQ: ADBE): Q1 Earnings Preview 2011

Adobe Systems Inc. (NASDAQ: ADBE) is scheduled to release its fiscal firs-quarter earnings after the closing bell on Tuesday, March 22, 2010. Analysts, on average, expect the company to report earnings of 57 cents per share on revenue of $1.03 billion. In the year ago period, the company reported earnings of 40 cents per share on revenue of $858.70 million.

Adobe Systems Incorporated operates as a diversified software company in the Americas, Europe, the Middle East, Africa, and Asia. It offers a line of creative, business, Web, and mobile software and services used by creative professionals, knowledge workers, consumers, original equipment manufacturers, developers, and enterprises.

In the preceding fiscal-fourth quarter, the San Jose, California-based company's net income was $268.9 million or $0.53 per share, compared to a GAAP net loss of $32.0 million or $0.06 per share for the year-ago quarter.Excluding restructuring charges, stock options expense and other items, non-GAAP net income for the fourth quarter was $285.7 million or $0.56 per share, compared to non-GAAP net income of $206.8 million or $0.39 per share in the prior year quarter. Revenue jumped 33% to a record $1.01 billion from $757.28 million in the same quarter last year. Analysts, on average, expected the company to report earnings of $0.52 per share on revenue of $988.07 million. 

At its last earnings call in December, Adobe forecast revenue of $1.00 billion to $1.05 billion, GAAP earnings of $0.43 to $0.49 per share and non-GAAP earnings of $0.54 to $0.59 per share. GAAP operating margin for the first quarter is expected to be 28% to 29.5%, while non-GAAP operating margin is expected to be 37% to 38%. Adobe continues to target at least 10% revenue growth in fiscal 2011. The company remains committed to its goal of achieving $5 billion in revenue by 2012.

The company's sales have been helped by economic stabilization and recovery in technology market in recent months. Companies are increasing budgets for advertising and marketing materials that can be created with Adobe's software, while worldwide PC sales too have recovered. Adobe released its latest Creative Suite version, CS5, in April 2010. According to Adobe, customer feedback for CS5 continues to be overwhelmingly positive.

However, Adobe Flash is facing an onslaught of up-and-coming alternatives that could threaten the former's dominant status as the defacto rich-media platform online. Apple does not support Flash on its iOS devices, arguing that Adobe's multimedia technology is vulnerable to exploits, consumes too much battery life, and crashes too often. In order to answer Flash critics, Adobe recently released a new tool, codenamed Wallaby, to convert Flash files to HTML5 so that they can run on Apple devices like the iPad and iPhone.

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Adobe Systems (NASDAQ: ADBE): Q4 Earnings Preview 2010

Adobe Systems Inc. (NASDAQ: ADBE) is scheduled to release its fiscal fourth-quarter earnings after the closing bell on Monday, December 20, 2010. Analysts, on average, expect the company to report earnings of 52 cents per share on revenue of $988.07 million. In the year ago period, the company posted earnings of 39 cents per share on revenue of $757.28 million.

Adobe Systems Incorporated operates as a diversified software company in the Americas, Europe, the Middle East, Africa, and Asia. It offers a line of creative, business, Web, and mobile software and services used by creative professionals, knowledge workers, consumers, original equipment manufacturers, developers, and enterprises.

In the preceding fiscal-third quarter, the San Jose, California-based company's net income was $230.1 million, or 44 cents a share, compared to $136 million, or 26 cents a share, in the year-ago quarter. On an adjusted basis, the company earned 54 cents a share in the latest quarter. Revenue jumped to $990.3 million from $697.5 million in the same quarter last year. Analysts, on average, expected the company to report earnings of 41 cents per share on revenue of $984.07 million. 

Late in October, the company affirmed its fourth-quarter earnings and revenue outlook, provided on September 1. The company expects fourth-quarter revenue of $950 million to $1 billion, GAAP earnings of $0.35 to $0.41 per share and non-GAAP earnings of 48 cents to 54 cents per share, GAAP operating margin of 27 to 30 percent, and a non-GAAP operating margin of 37 to 38 percent.. The company also stated that it is targeting a revenue growth of 10% for the next year. The company remains committed to its goal of achieving $5 billion in revenue by 2012.

The company's sales have been helped by economic stabilization and recovery in technology market in recent months. Companies are increasing budgets for advertising and marketing materials that can be created with Adobe's software, while worldwide PC sales too have recovered. Adobe released its latest Creative Suite version, CS5, in April 2010. According to Adobe, customer feedback for CS5 continues to be overwhelmingly positive.

However, Adobe Flash is facing an onslaught of up-and-coming alternatives that could threaten the former's dominant status as the defacto rich-media platform online. 

Among other developments, Adobe completed acquisition of Day Software Holdings on October, 29, 2010. The company believes that the acquisition of Day puts it on the path to deliver best in-class customer experience management solutions to enterprise. 

In terms of stock performance, Adobe shares are down nearly 9% since the beginning of the year.

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Adobe Systems Inc. (NASDAQ: ADBE): Q1 Earnings Preview 2010

Adobe Systems Inc. (NASDAQ: ADBE) is scheduled to release its fiscal first-quarter 2010 financial results after the market close on Tuesday, March 23, 2010. Analysts, on average, expect the company to report earnings of 37 cents a share on revenue of $827.16 million. In the year ago period, the company posted earnings of 45 cents per share on revenue of $786.39 million.

Adobe Systems Incorporated operates as a diversified software company in the Americas, Europe, the Middle East, Africa, and Asia. It offers a line of creative, business, Web, and mobile software and services used by creative professionals, knowledge workers, consumers, original equipment manufacturers, developers, and enterprises.

In the preceding fiscal-fourth quarter, the San Jose, California-based company reported a GAAP net loss for the fourth quarter of $32.0 million or $0.06 per share, compared to GAAP net income of $245.9 million or $0.46 per share for the year-ago quarter. Excluding restructuring charges, stock options expense and other items, non-GAAP net income for the fourth quarter was $206.8 million or $0.39 per share, compared to $320.9 million or $0.60 per share in the prior year quarter. Revenue fell 17% to $757.28 million from $915.30 million in the same quarter last year. Analysts, on average, expected the company to report earnings of $0.37 per share on revenue of $$752.54 million.

For the first quarter, the company anticipates revenue of $800 million to $850 million, GAAP earnings of $0.21 to $0.25 per share and non-GAAP earnings of $0.34 to $0.39 per share.

The company's sales have been helped by economic stabilization and recovery in technology market in recent months. Companies are increasing budgets for advertising and marketing materials that can be created with Adobe's software, while worldwide PC sales too have recovered. Adobe has been working very hard on the follow-up to CS4. Industry expect the publishing and design software maker to release CS5 suite in April 2010. The company sees a larger available market for its Creative Suite 5, and data and reviews point to a solid release of the highly anticipated product.

In February 2009, Adobe released to developers a test version of its upcoming Flash Player 10.1, which is designed to run well on smartphones and other mobile devices. According to a Strategy Analytics analysis from January 2010, more than 250 million smartphones that support the full Flash Player are expected ship by the end of 2012.

However, Adobe Flash is facing an onslaught of up-and-coming alternatives that could threaten the former's dominant status as the defacto rich-media platform online. The launch of Apple's iPad, which does not support Flash, has also heated up the debate on whether the Adobe platform is in danger of losing market share to competing alternatives.

The company's stock currently trades at a forward P/E (fye 27-Nov-11) of 17.15 and PEG Ratio (5 yr expected) of 1.38. In terms of stock performance, Adobe shares are up 41% over the past year.

Full Disclosure: None.