Adobe tops quarterly results and forecast estimates driven by AI
Business
Adobe's spree to boost AI innovation has been evident by AI features being introduced
(Reuters) - Adobe Inc surpassed Wall Street estimates for quarterly results and forecast as the Photoshop maker's efforts to drive up demand with generative artificial intelligence (AI) integrations paid off.
Shares of the San Jose, California-based company rose more than 5% in aftermarket trading.
Adobe's spree to boost AI innovation has been evident by AI features being introduced into Acrobat, Express, Photoshop and Premiere Pro.
Earlier this month, Adobe said it would offer Firefly, its artificial intelligence tool for generating images, to its large business customers, with financial indemnity for copyright challenges involving content made with the tools.
"Users have now generated over half a billion assets on the Firefly website and in Photoshop, making these two of our most successful beta releases in company history," Adobe CFO Dan Durn told Reuters.
Analysts see generative AI as both a near- and long-term benefit to both the creative and experience businesses, which could be a catalyst to 2024 revenue growth.
The company forecast current-quarter revenue to be in the range of $4.83 billion to $4.87 billion and raised FY 2023 revenue to between $19.25 billion and $19.35 billion, both on the higher end of analysts' estimates, according to Refinitiv data.
Focus continues to remain on the impact of generative AI and the pending close of the Figma deal. Adobe has been waiting to finalize its $20 billion buyout deal for the cloud-based designer platform, with management expecting an initial ruling this month.
The deal would give Adobe ownership of a company whose web-based collaborative platform for designs and brainstorming is widely popular among tech firms, including Zoom Video Communications, Airbnb Inc and Coinbase.
Revenue stood at $4.82 billion for the quarter ended June 2, compared to analysts' estimates of $4.77 billion, while adjusted profit came in at $3.91 per share, above estimates of $3.79 per share.
