Adobe Systems Earnings Cheat Sheet: Topping Analyst Estimates

S&P 500 (NYSE:SPY) component Adobe Systems Incorporated (NASDAQ:ADBE) reported its results for the fourth quarter. Adobe Systems offers a line of creative, business, web, and mobile software and services used by creative professionals, knowledge workers, consumers, original equipment manufacturers, developers, and enterprises.

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Adobe Systems Incorporated Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for Adobe Systems Incorporated fell to $173.7 million (35 cents per share) vs. $268.9 million (53 cents per share) a year earlier. This is a decline of 35.4% from the year earlier quarter.

Revenue: Rose 14.3% to $1.15 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: ADBE reported adjusted net income of 67 cents per share. By that measure, the company beat the mean estimate of 50 cents per share. It beat the average revenue estimate of $1.09 billion.

Quoting Management: “Adobe’s record results in Q4 and fiscal 2011 were driven by strong performance in our digital media and digital marketing businesses,” said Shantanu Narayen, president and CEO of Adobe. “We intend to be the market leader in these two large categories, which will drive strong revenue and earnings growth.”

Key Stats:

Revenue has risen the past four quarters. Revenue increased 2.3% to $1.01 billion in the third quarter. The figure rose 8.5% in the second quarter from the year earlier and climbed 19.7% in the first quarter from the year-ago quarter.

The company beat estimates last quarter after being in line with expectations in the third quarter with net income of 44 cents per share.

Margins rose in the third quarter after falling the quarter before. Gross margin rose 0.5 percentage point to 89.9% from the quarter earlier quarter. In the second quarter, the figure rose 0.3 percentage point to 89.7% from the year earlier quarter.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the first quarter of the next fiscal year has moved down from 48 cents a share to 47 cents over the last ninety days. For the fiscal year, the average estimate has moved up from $1.84 a share to $1.85 over the last ninety days.

Competitors to Watch: Microsoft Corporation (NASDAQ:MSFT), Google Inc. (NASDAQ:GOOG), Apple Inc. (NASDAQ:AAPL), Oracle Corporation (NASDAQ:ORCL), Autodesk, Inc. (NASDAQ:ADSK), Sonic Solutions (NASDAQ:SNIC), Monotype Imaging Hldgs. Inc. (NASDAQ:TYPE), Bitstream Inc. (NASDAQ:BITS), Intl. Business Machines Corp. (NYSE:IBM), and Sonic Foundry, Inc. (NASDAQ:SOFO).

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)