Adobe Earnings Report: What You Need To Know

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The Anticipation of Adobe’s Second-Quarter Earnings Report for Fiscal Year 2024

Key Takeaways

  • Adobe is set to release its second-quarter earnings report for the 2024 fiscal year after the bell on Thursday.
  • The company is expected to report that revenue and net income gained from the year-ago period, according to analyst estimates compiled by Visible Alpha.
  • Investors will likely be watching for sustained momentum in Adobe’s Digital Media business.
  • Adobe could also provide updates on its artificial intelligence monetization plan.

Adobe (ADBE) is gearing up to announce its second-quarter earnings for the 2024 fiscal year after the bell on Thursday. Investors are eagerly awaiting this report, with a keen eye on the company’s Digital Media segment momentum and insights into its artificial intelligence (AI) monetization strategy.

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Analysts have projected Adobe’s revenue to reach $5.29 billion for the second quarter of fiscal 2024, showing growth from the previous quarter and the year-ago period based on estimates compiled by Visible Alpha. Net income is also expected to rise to $1.51 billion, up from $1.3 billion in the fiscal second quarter of 2023. Additionally, diluted earnings per share (EPS) are anticipated to be $3.34, compared to $2.82 in the same period a year earlier.

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Analyst Estimates for Q2 FY 2024 Q1 FY 2024 Q2 FY 2023
Revenue $5.29 billion $5.18 billion $4.82 billion
Diluted Earnings Per Share $3.34 $1.36 $2.82
Net Income $1.51 billion $620 million $1.3 billion

Key Metrics: Digital Media Growth

Adobe’s Digital Media segment generated $3.82 billion in revenue in the first quarter of fiscal 2024, showcasing a 12% year-over-year growth. Analysts are anticipating Digital Media to achieve $3.89 billion in revenue, reflecting a 10.8% growth from the year-ago period.

Citi analysts have expressed their expectations for a positive outcome in the second quarter for the Digital Media segment. However, they also noted a challenging setup to meet consensus estimates in the third quarter, with the latter half of the fiscal year appearing somewhat ambitious.

Business Spotlight: AI Monetization Outlook

Recently, Adobe unveiled an AI assistant subscription add-on to its existing offerings, aiming to enhance its monetization of emerging technologies and compete with other tech giants in the industry. Despite this move, Adobe’s stock has faced pressure due to competitive concerns and perceived underwhelming near-term genAI monetization, as highlighted by Deutsche Bank analysts.

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In their analysis, Deutsche Bank analysts mentioned that while Generative AI monetization is still evolving, they anticipate investors to gain confidence in Adobe’s broader GenAI positioning post-earnings call. They also highlighted increasing partner enthusiasm around GenStudio, Firefly Services, and custom models.

Adobe’s shares have experienced a decline of over one-fifth of their value since the beginning of 2024, closing at $462.69 as of Tuesday.

As Adobe gears up to release its second-quarter earnings report for fiscal year 2024, investors are eagerly awaiting insights into the company’s financial performance, particularly in its Digital Media segment and AI monetization strategy. The outcome of this report could potentially impact Adobe’s stock performance and market perception moving forward.

Read the original article on Investopedia for more detailed information on Adobe’s upcoming earnings report for the second quarter of fiscal year 2024.

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