Adobe Systems Incorporated (NASDAQ:ADBE) reaffirmed its fiscal 2023 revenue and earnings forecasts as it reported solid Q4 2022 results and also said it expects to complete its $20 billion purchase of Figma next year, despite regulatory reviews in the US, UK and Europe.
Overall for its fourth quarter ended December 2, 2022, Adobe posted a profit of $1.18 billion, or $2.53 a share, compared with $1.23 billion, or $2.57 a share, for the prior year. Stripping out one-time items, the company’s quarterly earnings came in at $3.60, ahead of analyst estimates for $3.50 a share, while revenues rose by 10% to $4.5 billion, in-line with Wall Street estimates, the company said in a statement released after the market close on Thursday
Adobe forecast that its 2023 revenue will be about $19.2 billion, with annual adjusted earnings to be $15.15 to $15.45 a share, while it expects adjusted earnings of $3.65 to $3.70 in the current first quarter. That forecast, as well as the sales outlook for Adobe’s divisions, was the same as the company’s previous guidance given in October. Adobe’s forecast does not include any contribution from Figma in its forecasts.
READ: Adobe Systems reaffirms fiscal 2022 estimates but sees 2023 guidance disappoint
“Strong demand for our offerings, industry-leading innovation and track record of top- and bottom-line growth set us up to capture the massive opportunities in 2023 and beyond,” the company's chief financial officer Dan Durn said in the statement.
Adobe is seeking to expand its user base to more casual consumers with the acquisition of Figma, announced in September. The deal would be one of the most expensive purchases ever of a private software maker.
Despite concerns about the price, the Figma acquisition should support “Adobe’s leading position in digital creation and marketing,” Brian Schwartz, an analyst at Oppenheimer said in a recent note ahead of earnings.
Adobe shares were 5% higher at $345.00 in pre-market trading on Friday, having jumped 15% after-hours. The stock, however, has dropped by 42% this year.
-- Updates with Q4 results; pre-market share price --
Contact the author at jon.hopkins@proactiveinvestors.com