Adobe reports record revenue (again)


Adobe reported record revenue for its third quarter for the 2017 fiscal year that ended on September 1, 2017 (see also the previous report from June 2017). Here are the financial highlights:

  • Adobe achieved record quarterly revenue of $1.84 billion in its third quarter of fiscal year 2017, which represents 26 percent year-over-year revenue growth.
  • Diluted earnings per share was $0.84 on a GAAP-basis, and $1.10 on a non-GAAP basis.
  • Digital Media segment revenue was $1.27 billion, with Creative revenue growing to $1.06 billion.
  • Digital Media Annualized Recurring Revenue (“ARR”) grew to $4.87 billion exiting the quarter, a quarter-over-quarter increase of $308 million.
  • Adobe Experience Cloud achieved revenue of $508 million, which represents 26 percent year-over-year growth.
  • Operating income grew 48 percent and net income grew 55 percent year-over-year on a GAAP-basis; operating income grew 43 percent and net income grew 46 percent year-over-year on a non-GAAP basis.
  • Cash flow from operations was $704 million, and deferred revenue grew to approximately $2.20 billion.
  • The company repurchased approximately 2.1 million shares during the quarter, returning $298 million of cash to stockholders.

Executive quotes:

“Adobe delivered another record quarter with stellar year-over-year revenue growth of 26 percent,” said Shantanu Narayen, president and CEO, Adobe. “The imperative to deliver intelligent, intuitive and effective customer experiences is key to the C-suite agenda of digital transformation, and Adobe’s cloud offerings are critical to that business mandate.”

“Our results in Q3 once again reflect the leverage of our financial model, with record revenue driven by our cloud-based subscription offerings, strong earnings and cash flow from operations," said Mark Garrett, executive vice president and CFO, Adobe.

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  • GearHeavy

    Some of that money is mine :o( Yeah, rub it in our faces Adobe.

  • Jim

    And yet LR has not been significantly updated and continues to be a dog.

    • Chaitanya

      lack of competition doesnt help much. I hate the subscription model and dont think Adobe will release an update to standalone version of LR anytime.

      • As reported on this site 3 days ago, LR 7 is in beta-testing at the moment, with a probable October release date.

        • Chaitanya

          as long as its standalone release, thats a good news.

          • Let’s hope so. I know Adobe said that they will keep LR standalone, but for some reason I am not buying it.

          • I guess we won’t know for sure until / if it’s released, but the fact that the tester referred to it as LR 7 (rather than CC) is encouraging.

          • yes, I think LR7 will still be available as a standalone, but one day they will go CC

        • Mr B

          Confirmed. I have that same information from a source inside Adobe.

          • thanks, will share this online

  • Jeff Bridges

    Renting vs Owning.

  • King of Swaziland

    Adobe: Holding photos hostage for record profits since 2013…

    • You can still buy the standalone version (although they make you navigate a labyrinth to get it). For how much longer is unknown, but LR7 is in beta-testing and may be released next month.

    • TurtleCat

      Not really. You can still use Lightroom CC to do most everything but develop module and I think face or map after you cancel. That’s not really a hostage situation.

      • Zos Xavius

        DNG is also well supported and not exactly a dead end either.

      • I think he is referring to the time when they will move Lightroom to a cloud only subscription.

        • TurtleCat

          True. But after over a year of looking for any scrap of info about LR 7 I was surprised when I found one. They’ve kept it very secretive.

          • Yes, even that quote doesn’t tell us much.

          • TurtleCat

            It told us one important thing, though, that there is an update in the works.

      • Chaitanya

        Map module also stops working post cancellation of subscription. Since Adobe has to pay Google for licensing maps, its fair enough that Map also gets disabled.

        • TurtleCat

          Couldn’t remember which one it was.

    • I have no problem with paying for the standalone version. Once you go to the cloud, it’s already too late – you are hooked and they can set any price they want in the future.

      • GMck

        Subscription revenue models are what most firms want to move to. There are alternatives to Lightroom, but it’s not always easy to switch when you have a workflow you use day in, day out.

        • Yes I agree, my point is that they already made record profits – they should keep both options available and everybody will be happy.

  • Callum Gibson

    This is encouraging me to cancel my sub. I’d rather put £120 into my D850 fund.

  • Michiel Schierbeek

    Time to look for aternatives folks. I don’t like renting.

  • JasonsArgonauts

    I know that the CC model annoys many, but I’m happy to pay a nominal £/$/€10 every month to have a constantly up to date and great software package. However, the fact that lightroom isn’t constantly updated, has memory leaks everywhere, continuously needs the cache purging, doesn’t multi-thread using the processors available and doesn’t work very well in terms of speed compared to a lot of the competition, means that more and more photographers will search for a viable alternative, whether that be Capture One, Affinity Photo, Coral, or someone a bit more esoteric like Alien Skin. Adobe will have to catch up and not become too complacent or they will lose more and more market share. It’s a massive wind-up that they have such a huge profit and yet still can’t get the basics of the platform right. They introduce new and brilliant features all the time, but if the fundamentals of the software are flawed then it just doesn’t work.

    • that’s ok – I am not against the CC model, I just want to have a choice between CC and standalone. I do not want to be forced to go to a CC subscription model if I prefer standalone.

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