Strong quarter, ARR guidance raised
Q4 upside and a raised FY18 ARR outlook should be well-received, although there was little overall to change investors' view on the stock. Q4 saw Digital Media revenue and ARR comfortably ahead, with revenue upside falling to the bottom line to deliver a strong EPS beat. Experience Cloud revenue was also ahead with bookings performance in that segment stabilising. Adobe now expects to add $1.1bn in net new Digital Media ARR, $100m above its prior guidance, but even this looks conservative given current momentum. We maintain our Overweight stance.Adobe is a software company. The company provides a line of products and services used for creating, managing, delivering, measuring, optimizing, engaging and transacting with content across personal computers, devices and media. The company's segments are: Digital Media, which provides products, services and solutions that enable individuals, teams and enterprises to create, publish and promote their content; Digital Experience, which provides a platform and set of applications and services through Adobe Experience Cloud; and Publishing, which contains products and services that address market opportunities including eLearning solutions, web conferencing, web application development and printing.
Formed in 2003 by an established team from Cazenove, one of the most respected investment banks in the UK, Atlantic Equities conducts and publishes fundamental, bottom up research on mid and large cap US companies.
Atlantic provide order execution through a wide range of DMA products and algorithmic trading suites.
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