By Dhirendra Tripathi
Investing.com – Adobe stock (NASDAQ:ADBE) tumbled 9% Thursday after the company’s forecast for 2022 revenue came in short of expectations.
The design software-maker expects revenue to hit $17.9 billion in the ongoing financial year, up over 13% year-on-year but sharply slower than the 23% rate the 2021 revenue grew at to top $15 billion.
According to Bloomberg estimates, the company was expected to peg its annual forecast at $18.2 billion.
Adobe expects annual adjusted profit per share to touch $13.70 in the current financial year, higher than 2021’s $12.48 but lower than Bloomberg’s $14.20 estimate.
The company closed the quarter ending December 3 with remaining performance obligations of $14 billion, which is 23% higher than last year.
The company’s digital media unit, which includes creative and document cloud products such as Photoshop, PDF, and Illustrator, boomed during the pandemic as millions worked from home and online activities surged. But all those products now face increasing competition from the likes of Canva.
Fourth-quarter revenue grew 20% to a record $4.11 billion, driven by subscriptions. Product revenue rose negligibly while revenue from services fell. Adjusted EPS was $3.20.
Digital media segment revenue grew 21%, to $3 billion. Creative revenue rose 19%, to $2.48 billion. Document Cloud revenue was up 29%, at $532 million.
Adobe expects revenue to touch $4.23 billion in the ongoing quarter.