Adobe Outlines Growth Opportunities

Thursday, November 03, 2016

Press release from the issuing company

Company Provides Preliminary Financial Targets for Fiscal Year 2017

SAN DIEGO - Adobe (Nasdaq:ADBE) today will host a financial analyst meeting at its Adobe MAX user conference with investors and financial analysts.

At today’s meeting, Adobe will outline the company’s momentum, opportunities and strategy across each of its major businesses. As part of their presentations, Adobe executives will present market research information which indicates the company’s total addressable market has expanded to approximately $64 billion by 2019. The Company is also providing preliminary financial targets for fiscal year 2017, and is commenting on both its current Q4 FY2016 outlook and its long-term financial targets.

“Adobe's vision for delivering the world's greatest digital experiences, through our Creative Cloud, Document Cloud and Marketing Cloud solutions, continues to expand our long-term growth opportunities,” said Shantanu Narayen, Adobe president and chief executive officer.

Adobe Provides Preliminary FY2017 Financial Targets

At today’s financial analyst meeting, Adobe is providing preliminary financial targets for its fiscal year 2017, which are summarized in the table below.

Total Adobe revenue		Approximately $7 billion (~20 percent year-over-year growth)
Digital Media segment revenue		Approximately 20 percent year-over-year growth
Digital Media Annualized Recurring Revenue (“ARR”)		Approximately 25 percent year-over-year growth
Adobe Marketing Cloud revenue		Approximately 20 percent year-over-year growth
Adobe Marketing Cloud Annual Subscription Value (“ASV”) bookings		Approximately 30 percent year-over-year growth
GAAP earnings per share		Approximately $2.85
Non-GAAP earnings per share		Approximately $3.75

A reconciliation between FY2017 GAAP and non-GAAP earnings per share targets is provided at the end of this press release.

Adobe Reaffirms Financial Targets

Adobe stated it expects to achieve Q4 FY2016 revenue in its targeted range of $1.55 billion to $1.60 billion. The Company also stated it is on track to achieve earnings per share within its targeted ranges which were $0.60 to $0.66 on a GAAP-basis, and $0.83 to $0.89 on a non-GAAP basis.

The Company also expects to meet or exceed its FY2015 through FY2018 compound annual growth rate (“CAGR”) targets, which are summarized in the table below.

Total Adobe revenue		Approximately 20 percent CAGR
Digital Media segment revenue		Greater than 20 percent CAGR
Digital Media ARR		Greater than 20 percent CAGR
Adobe Marketing Cloud revenue		Greater than 20 percent CAGR
Adobe Marketing Cloud ASV bookings		Approximately 30 percent CAGR
Non-GAAP earnings per share¹		Approximately 30 percent CAGR
Operating cash flow		Approximately 25 percent CAGR

¹As part of its long-term growth targets, Adobe believes it can achieve approximately 30 percent CAGR in non-GAAP diluted net earnings per share. Although the information to enable Adobe to reconcile and provide GAAP diluted earnings per share targets for those years is not available at this time, reconciling items are expected to include, stock-based and deferred compensation expense, amortization of purchased intangibles, investment gains and losses and income tax adjustments.