Boston, MA 06/18/2014 (wallstreetpr) – Adobe Systems Incorporated (NASDAQ:ADBE) lacked something good to write home about in the past five or six quarters except the fact it was losing money in an alarming rate. However, in the latest reporting, the company appears to be making successful inroads in its business, which is in the middle of a big shift.
The company not only exceeded Wall Street expectations for 2Q2014 financial performance, but also saw an increase in its revenue for the first time in six quarters. The company also noted higher customer addition in the quarter.
Adobe Systems Incorporated (NASDAQ:ADBE) is shifting its business model from selling software, which costs as much as $2,600, to providing subscription where users can access the software on the cloud for $50 a month.
The company’s products are used by marketing departments and app developers. It provides software products such as Illustrator, Photoshop and Dreamweaver. The shift to cloud-based software offering saw revenue decline in the company in the past quarters. However, the CEO Shantanu Narayen believes that they will recoup the lost revenue as the company expands its product offering and add customers in a faster rate than estimated. The company reported adding more subscribers than it predicted in the latest quarter.
2Q2014 financial performance
Adobe Systems reported revenue of $1.07 billion in 2Q, suggesting an increase of 5.7 percent over the same quarter a year earlier. The revenue topped Wall Street estimate of $1.03 billion for the quarter. The strong revenue gain was supported by a big gain in subscriber addition whereby the company exceeded its own target of 2.3 million subscribers in the quarter to hit 2.31 million following 464,000-customer signup in the three months period.
The company reported $88.5 million net income or $0.17 per share in 2Q. That was better than a net income of $76.5 million or $0.15 per share in the same quarter a year ago.
Adobe Systems Incorporated (NASDAQ:ADBE) projected revenue between $975 million and $1.025 billion in the current quarter. It expects profits between $0.22 and $0.28 per share in the quarter. The performance projects are ahead of the estimated revenue of $1.02 billion and $0.27 per share for the current quarter.
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