16 December Adobe reported for the fourth quarter of 2021. The results were slightly better than expected., but the company gave a weak outlook for the next quarter. During the day, ADBE shares fell by 10%, to 566 $.
Revenue will grow by only 8%
Here are the financial results compared to the same quarter last year:
- revenue — 4.1 billion dollars (+20%);
- operating profit - 1.5 billion (+24%);
- net profit - 1.2 billion (−45%).
And this is the revenue for the main operating segments:
- Digital Media - content creation apps like Photoshop and document management apps like Acrobat Reader - $3 billion (+21%);
- Digital Experience - analytical services, that help other companies increase sales, - billion dollars (+23%).
Net income almost doubled, since Adobe a year ago received tax deduction for a billion dollars. And here is the adjusted profit, which does not take into account such articles, grew by 13%, up to 1.5 billion dollars.
The company also gave a revenue forecast for the next quarter and fiscal year 2022.. It came out worse than analysts expected.:
- first quarter of 2022 — 4,23 vs$4.34 billion;
- 2022 year - 17.9 against 18.16 billion dollars.
Adobe explained this forecast by, that the first quarter of fiscal year 2022 will be a week shorter, than in 2021. As a result, revenue in the Digital Media and Digital Experience segments will not increase by 17 And 18%, as was expected, and only on 8 And 11% compared to the first quarter of 2021.
Revenue and forecast for the next quarter, million dollars
| 1к2021 | 3905 (+26%) |
| 2к2021 | 3835 (+23%) |
| 3к2021 | 3935 (+22%) |
| 4к2021 | 4110 (+20%) |
| 1к2022 | 4230 (+8%) |
3905 (+26%)
What about stocks
The future slowdown in growth did not please investors, that's why Adobe's stock has fallen so much. This is the third significant drop in a month.. From its maximum in November, securities have fallen in price by 18%.
Possible monetary tightening puts pressure on expensive tech companies for weeks. This week the Fed said, that in 2022 it expects to raise the interest rate more strongly, than expected, right before 0,9%. In this case, the yield of safer deposits and bonds will increase, but the premium for the risk of owning expensive and overvalued shares will fall.
It is for these reasons that some analysts change their estimates.. So, J. P. Morgan recently cut Adobe's rating from Buy to Neutral. According to the bank, the company's shares do not have that much upside potential.
Given the recent drop in Adobe's securities since the beginning of the year, they have grown by 17%. Index S&P 500 added over the same period 26%.
