What To Expect From Adobe's (ADBE) Q2 Earnings

Max Juang /
2024/06/12 3:01 am EDT

Creative software maker Adobe (NASDAQ:ADBE) will be announcing earnings results tomorrow afternoon. Here's what you need to know.

Adobe met analysts' revenue expectations last quarter, reporting revenues of $5.18 billion, up 11.3% year on year. It was a mixed quarter for the company: Adobe exceeded analysts' billings expectations. Its net new digital media ARR of $432 million also beat estimates of $415 million, enabling the company to top Wall Street's revenue and EPS projections. On the other hand, its revenue guidance for next quarter missed analysts' expectations as its net new digital media ARR guidance of $440 million fell short of analysts' $468 million forecast.

Is Adobe a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting Adobe's revenue to grow 9.8% year on year to $5.29 billion, in line with the 9.8% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $4.39 per share.

Adobe Total Revenue

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Adobe has missed Wall Street's revenue estimates twice over the last two years.

With Adobe being the first among its peers to report earnings this season, we don't have anywhere else to look to get a hint at how this quarter will unravel for vertical software stocks. However, the segment has faced declining investor sentiment as Adobe's peer group is down 5.4% on average over the last month. Adobe is down 2.6% during the same time and is heading into earnings with an average analyst price target of $605.5 (compared to the current share price of $463.5).

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