Categories: Technology

Adobe forecasts fourth-quarter profit above estimates on AI strength

NEW YORK (Reuters): Photoshop software maker Adobe forecast current-quarter profit above Wall Street estimates on Thursday, after beating revenue estimates for the third quarter on strong demand for its photo, video editing and document tools with generative AI integrations.

The company has been investing in equipping its creative software with GenAI capabilities to increase its appeal to more users. Analysts expect GenAI to boost revenue growth in 2024 and in the longer term, as it gets integrated in Adobe’s products.

For the past six months, Adobe has been steadily adding new AI features to its programs, including the ability to generate images from text and the company plans to raise prices for its products starting November.

San Jose, California-based Adobe’s shares fell marginally in extended trading.

Excluding items, it reported earnings of $4.09 per share in the quarter ended Sept. 1, above analysts’ estimates of $3.98 per share, according to LSEG data.

Quarterly revenue stood at $4.89 billion, compared with estimates of $4.87 billion.

Adobe expects revenue between $4.98 billion and $5.03 billion for the fourth quarter, compared with analysts’ expectation of $5 billion, according to LSEG data.

The company expects fourth-quarter adjusted profit between $4.10 and $4.15 per share, compared with analysts’ average estimate of $4.06 per share.

The Frontier Post

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