Adobe Q2 profit up 37%

By agencies   |   Friday, 17 June 2005, 19:30 IST
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SAN FRANCISCO: Adobe Systems Inc. has reported a 37 percent rise in quarterly profit on demand for its document-sharing software, but its stock fell after the company provided an outlook that was not as aggressive as investors would have liked. The company, whose shares fell about 6 percent after hours, said second-quarter net income rose to $149.8 million, or 29 cents per share, from $109.4 million, or 22 cents a share, a year earlier. Total revenue increased to $496 million from $410.1 million a year earlier, the San Jose, California-based company said. The results were in-line with expectations, but the outlook was conservative because Adobe was headed into its seasonally weaker third quarter, analysts said. "I think they're appropriately being conservative on guidance ... Adobe's been bitten before (in the third quarter)," said Fulcrum Global Partners analyst Jamie Friedman, who does not own Adobe stock and rates the stock a "buy." Adobe declined to update its full-year outlook, but said it will provide a mid-quarter update for its current third quarter on Aug. 1 in a sign, analysts said, of the company's confidence about its operations. The company did not provide a mid-quarter update for its second quarter. Analysts had expected second-quarter earnings of 27 cents per share on revenue of $491.5 million, according to Reuters Estimates. Adobe said it did not see any change in business conditions in Japan or Europe, where about 29 percent of its revenue came from during the quarter, and said the weaker euro relative to the U.S. dollar added about $10 million to revenues during the quarter. About 49 percent of revenues in the second quarter came from the Americas, while about 22 percent came from Asia. Demand in Asia and Europe tends to be relatively weak during Adobe's third quarter as consumers take extended vacations.