CORRECTING and REPLACING Adobe Systems Reports Record Revenue and Profit; 43 Percent Revenue Growth Driven by Strong Adobe Creative Suite Adoption and Continued Adobe.Business Editors CORRECTION CORRECTION,punishment. Chastisement by one having authority of a person who has committed some offence, for the purpose of bringing him to legal subjection. 2. It is chiefly exercised in a parental manner, by parents, or those who are placed in loco parentis. ...by Adobe Systems Adobe Systems Incorporated (pronounced a-DOE-bee IPA: /əˈdoʊbiː/) (NASDAQ: ADBE) (LSE: ABS) is an American computer software company headquartered in San Jose, California, USA. Incorporated SAN JOSE San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , Calif.--(BUSINESS WIRE)--March 18, 2004 In BW5709 issued March 18, 2004: Second graph graph, figure that shows relationships between quantities. The graph of a function y=f (x) is the set of points with coordinates [x, f (x)] in the xy-plane, when x and y are numbers. , end of first sentence of release should read: reported in the fourth quarter of fiscal 2003 (sted reported in the fourth quarter of fiscal 2004). The corrected release reads: ADOBE SYSTEMS REPORTS RECORD REVENUE AND PROFIT; 43 PERCENT REVENUE GROWTH DRIVEN BY STRONG ADOBE CREATIVE SUITE Adobe Creative Suite is a collection of graphic design, video editing, and web development applications made by Adobe Systems. The latest version, Adobe Creative Suite 3 (CS3), was announced on March 27, 2007; it introduced Universal binaries for all programs for the Apple ADOPTION AND CONTINUED ADOBE adobe (ədō`bē): see rammed earth. adobe Handmade sun-dried bricks formed from a mixture of heavy clay and straw found in arid regions. ACROBAT Document exchange software from Adobe that allows documents to be displayed and printed the same on every computer. The Acrobat system created the Portable Document Format (PDF), which is widely used in commercial printing and on the Web. See PDF. SUCCESS Adobe Systems Incorporated (Nasdaq:ADBE ADBE Adobe Systems, Inc. (stock symbol) ) today reported strong financial results for its first quarter ended March 5, 2004. In the first quarter of fiscal 2004, Adobe achieved record revenue of $423.3 million, compared to $296.9 million reported for the first quarter of fiscal 2003 and $358.6 million reported in the fourth quarter of fiscal 2003. On a year-over-year basis, this represents 43 percent growth. Adobe's first quarter revenue target range was $380 to $405 million. "Our outstanding quarter was driven by strong global revenue from the new Adobe Creative Suite and record revenue from our Intelligent Documents business. This highlights the increasing relevance of Adobe technology platforms to creative professionals and enterprises worldwide," said Bruce Bruce, Scottish royal family descended from an 11th-century Norman duke, Robert de Brus. He aided William I in his conquest of England (1066) and was given lands in England. R. Chizen, president and chief executive officer of Adobe. "Given the impressive start in Q1, we have raised our fiscal 2004 financial targets." GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of for the first quarter of fiscal 2004 were $0.50. Non-GAAP diluted earnings per share, which does not include an investment loss from the company's venture program, also were $0.50. Adobe's revised GAAP and non-GAAP first quarter earnings target range was $0.36 to $0.42 per share. GAAP net income was a record $123.0 million for the first quarter of fiscal 2004, compared to $54.2 million reported in the first quarter of fiscal 2003, and $83.3 million in the fourth quarter of fiscal 2003. On a year-over-year basis, GAAP net income grew 127 percent. Non-GAAP net income, which does not, as applicable, include a partial reversal reversal n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its of prior restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. and investment gains and losses, was a record $123.8 million for the first quarter of fiscal 2004, compared to $58.9 million in the first quarter of fiscal 2003, and $83.0 million in the fourth quarter of fiscal 2003. On a year-over-year basis, non-GAAP net income grew 110 percent. GAAP diluted earnings per share for the first quarter of fiscal 2004 were $0.50 based on 246.1 million weighted average shares. This compares with GAAP diluted earnings per share of $0.23 reported in the first quarter of fiscal 2003, based on 235.3 million weighted average shares, and GAAP diluted earnings per share of $0.34 reported in the fourth quarter of fiscal 2003, based on 245.5 million weighted average shares. Adobe's GAAP operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. was $163.3 million in the first quarter of fiscal 2004, compared to $80.5 million in the first quarter of fiscal 2003 and $115.3 million in the fourth quarter of fiscal 2003. As a percent of revenue, GAAP operating income in the first quarter of fiscal 2004 was 38.6 percent, compared to 27.1 percent in the first quarter of fiscal 2003 and 32.1 percent in the fourth quarter of fiscal 2003. Adobe's non-GAAP operating income, which does not, as applicable, include a partial reversal of prior restructuring charges, was $163.3 million in the first quarter of fiscal 2004, compared to $80.5 million in the first quarter of fiscal 2003 and $115.2 million in the fourth quarter of fiscal 2003. As a percent of revenue, non-GAAP operating income for the first quarter of fiscal 2004 was 38.6 percent, compared to 27.1 percent in the first quarter of fiscal 2003 and 32.1 percent in the fourth quarter of fiscal 2003. Company Provides Second Quarter Financial Targets and Raises Fiscal Year 2004 Targets For the second quarter of fiscal 2004, the Company announced that it is targeting revenue of $365 to $385 million, a gross margin of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 93 to 94 percent, and GAAP and non-GAAP operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: ranges of 30 to 33 percent. As a percent of revenue, Adobe is targeting second quarter expenses as follows: Research & Development -- approximately 19 to 20 percent Sales & Marketing -- approximately 32 to 34 percent General & Administrative -- approximately 9 to 10 percent In addition, Adobe is targeting its share count range to be between 247 and 249 million shares in the second quarter of fiscal 2004. The Company also is targeting other income in its second quarter to be approximately $3 to $4 million, and a tax rate of 26 percent. These targets lead to second quarter GAAP and non-GAAP earnings per share target ranges of $0.33 to $0.39. For fiscal year 2004, Adobe increased its revenue target to a range of $1.475 to $1.5 billion. The Company also increased its annual operating margin target to a range of 31 to 32 percent, with a targeted GAAP and non-GAAP earnings per share range between $1.40 and $1.46. The Company's prior fiscal 2004 targets were revenue of approximately $1.425 billion, with an operating margin of approximately 30 percent. The Company currently believes targeted non-GAAP earnings per share and non-GAAP operating margin results will not differ materially from targeted GAAP results. The Adobe Board of Directors declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. this quarter's cash dividend of $0.0125 per share, payable on April 13, 2004 to stockholders of record as of March 30, 2004. Forward Looking Statements Disclosure This press release contains forward looking statements, including those related to revenue, gross margin, operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. , operating margin, other income, tax rate, share count and earnings per share, which involve risks and uncertainties that could cause actual results to differ materially. Factors that might cause or contribute to such differences include, but are not limited to: general economic or political conditions in any of the major countries in which we do business, introduction of new products by existing and new competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. , delays in development or shipment of our new products or major new versions of existing products, difficulties in implementing strategic alliances, difficulties in transitions to new business models or markets in the enterprise, government, consumer and creative professional markets, changes to our distribution channel, inability to attract and retain key personnel, lack of market acceptance of new products, upgrades and services, changes in demand for application software, computers and printers, intellectual property disputes and litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , industry transitions to new business models, renegotiation or termination The point where a line, channel or circuit ends. See SCSI termination and hybrid. of royalty Compensation for the use of property, usually copyrighted works, patented inventions, or natural resources, expressed as a percentage of receipts from using the property or as a payment for each unit produced. or intellectual property licensing arrangements, changes in accounting rules, unanticipated changes in tax rates and market risks associated with our equity investments. For further discussion of these and other risks and uncertainties, individuals should refer to the Company's SEC filings, including the 2003 annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and quarterly reports on Form 10-Q Form 10-Q See 10-Q. filed in 2004. The Company does not undertake an obligation to update forward looking statements. About Adobe Systems Incorporated Adobe helps people and businesses communicate better through its world-leading digital imaging, design and document technology platforms for consumers, creative professionals and enterprises. Adobe's revenue in the last fiscal year exceeded $1 billion. For more information about Adobe, visit www.adobe.com. (C) 2004 Adobe Systems Incorporated. All rights reserved. Adobe and the Adobe logo are registered trademarks of Adobe Systems Incorporated in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. other countries.
Condensed Consolidated Statements of Income
(In thousands, except per share data; unaudited)
Three Months Ended
------------------------
March 5, February 28,
2004 2003
---------- ------------
Revenue:
Products $ 415,752 $290,755
Services and support 7,529 6,140
--------- --------
Total revenue 423,281 296,895
--------- --------
Total cost of revenue:
Products 20,444 19,360
Services and support 3,738 3,002
--------- --------
Total cost of revenue 24,182 22,362
--------- --------
Gross profit 399,099 274,533
Operating expenses:
Research and development 75,071 65,956
Sales and marketing 127,354 98,028
General and administrative 33,412 30,041
--------- --------
Total operating expenses 235,837 194,025
--------- --------
Operating income 163,262 80,508
Non-operating income (loss), net:
Investment loss (1,031) (6,692)
Interest and other income 4,032 3,649
--------- --------
Total non-operating income (loss) 3,001 (3,043)
--------- --------
Income before income taxes 166,263 77,465
Provision for income taxes 43,228 23,240
--------- --------
Net income $ 123,035 $ 54,225
========= ========
Basic net income per share $ 0.52 $ 0.23
========= ========
Shares used in computing basic net
income per share 238,384 231,084
========= ========
Diluted net income per share $ 0.50 $ 0.23
========= ========
Shares used computing diluted net
income per share 246,087 235,294
========= ========
Condensed Consolidated Balance Sheets
(In thousands, except per share data)
March 5, November 28,
2004 2003
----------- -----------
(Unaudited) (Audited)
ASSETS
Current assets:
Cash and cash equivalents $ 199,759 $ 189,917
Short-term investments 1,049,576 906,616
Trade receivables 122,955 146,311
Other receivables 32,035 27,731
Deferred income taxes 27,955 35,875
Other current assets 29,858 22,578
----------- -----------
Total current assets 1,462,138 1,329,028
----------- -----------
Property and equipment, net 82,512 77,007
Goodwill 95,971 95,971
Purchased and other intangibles, net 15,161 15,318
Other assets 35,724 37,721
----------- -----------
Total assets $ 1,691,506 $ 1,555,045
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade and other payables $ 35,598 $ 37,437
Accrued expenses 175,508 160,009
Income taxes payable 185,363 193,484
Deferred revenue 43,326 45,600
----------- -----------
Total current liabilities 439,795 436,530
----------- -----------
Deferred income taxes, long-term 34,227 17,715
Stockholders' equity:
Common stock, $0.0001 par value 29,576 29,576
Additional paid-in-capital 901,831 874,126
Retained earnings 1,920,444 1,800,398
Accumulated other comprehensive income
(loss) 5,582 (999)
Treasury stock at cost, net of re-
issuances (1,639,949) (1,602,301)
----------- -----------
Total stockholders' equity 1,217,484 1,100,800
----------- -----------
Total liabilities and stockholders' equity $ 1,691,506 $ 1,555,045
=========== ===========
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Three Months Ended
--------------------------
March 5, February 28,
2004 2003
---------- --------------
Cash flows from operating activities:
Net income $ 123,035 $ 54,225
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 13,438 11,992
Stock compensation expense 184 952
Deferred income taxes 23,110 5,744
Provision for losses on receivables (2,114) 495
Tax benefit from employee stock
option plans 5,124 2,014
Loss on equity and cost method
investments 1,083 3,554
Gains on sale of equity securities - (771)
(Gain)loss on other-than-temporary
declines of equity securities (51) 3,910
Changes in operating assets and
liabilities:
Receivables 21,166 (12,560)
Other current assets (4,503) (2,492)
Trade and other payables (1,839) (3,574)
Accrued expenses 11,782 14,410
Accrued restructuring charges (587) (4,742)
Income taxes payable (8,121) 4,891
Deferred revenue (2,274) 1,299
--------- ---------
Net cash provided by operating
activities 179,433 79,347
--------- ---------
Cash flows from investing activities:
Purchases of short-term investments (394,741) (124,464)
Maturities and sales of short-term
investments 255,827 45,568
Acquisitions of property and equipment (14,444) (7,490)
Purchases of long-term investments and
other assets (4,135) (3,516)
Proceeds from sale of equity securities - 1,764
--------- ---------
Net cash used for investing activities (157,493) (88,138)
--------- ---------
Cash flows from financing activities:
Purchase of treasury stock (55,607) (45,207)
Proceeds from issuance of treasury stock 46,163 13,729
Payment of dividends (2,986) (2,887)
--------- ---------
Net cash used for financing
activities (12,430) (34,365)
--------- ---------
Effect of foreign currency exchange rates
on cash and cash equivalents 332 1,569
--------- ---------
Net increase (decrease) in cash and cash
equivalents 9,842 (41,587)
Cash and cash equivalents at beginning of
period 189,917 183,684
--------- ---------
Cash and cash equivalents at end of period $ 199,759 $ 142,097
========= =========
Non-GAAP Results
(In thousands, except per share data)
The following table shows the Company's non-GAAP results reconciled to
the Generally Accepted Accounting Principles ("GAAP") results included
in this release. The Company's non-GAAP results do not, as applicable,
include restructuring and other charges or investment gains and
losses.
March February November
5, 2004 28, 2003 28, 2003
--------- --------- ---------
GAAP operating income $163,262 $ 80,508 $115,263
Restructuring and other charges - - (105)
-------- -------- --------
Non-GAAP operating income $163,262 $ 80,508 $115,158
======== ======== ========
GAAP net income $123,035 $ 54,225 $ 83,349
Restructuring and other charges, net
of tax - - (74)
Investment (gain)loss, net of tax 763 4,685 (265)
-------- -------- --------
Non-GAAP net income $123,798 $ 58,910 $ 83,010
======== ======== ========
Diluted net income per share:
GAAP net income $ 0.50 $ 0.23 $ 0.34
Restructuring and other charges, net
of tax - - -
Investment (gain)loss, net of tax - 0.02 -
-------- -------- --------
Non-GAAP net income $ 0.50 $ 0.25 $ 0.34
======== ======== ========
Shares used computing diluted net
income per share 246,087 235,294 245,512
======== ======== ========
Adobe continues to provide all information required in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with GAAP, but it believes that evaluating its ongoing operating results may not be as useful if an investor is limited to reviewing only GAAP financial measures. Accordingly, Adobe uses non-GAAP financial information to evaluate its ongoing operations and for internal planning and forecasting purposes. Adobe's management does not itself, nor does it suggest that investors should, consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Adobe presents such non-GAAP financial measures in reporting its financial results to provide investors with an additional tool to evaluate Adobe's operating results in a manner that focuses on what Adobe believes to be its ongoing business operations Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets . Adobe's management believes it is useful for itself and investors to review both GAAP information that includes the expenses, charges and investment gains and losses discussed below and the non-GAAP measures that exclude such expenses, charges and investment gains and losses in order to assess the performance of Adobe's business and for planning and forecasting in subsequent periods. Adobe's non-GAAP operating income excludes, as applicable, restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and other charges. Non-GAAP net income and non-GAAP diluted earnings per share exclude, as applicable, restructuring and other charges and investment gains and losses. Management believes that the inclusion of these non-GAAP financial measures provide consistency Consistency can refer to:
Adobe excludes restructuring and other charges, including (i) employee severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and other termination benefits, (ii) lease termination costs and other expenses associated with exiting facilities, and (iii) other costs associated with terminating contracts, from its non-GAAP financial measure of operating income and net income. Adobe's management does not consider these restructuring costs as a normal component of its expenses related to ongoing operations as such charges have occurred only periodically and have not been directly linked to the level of Adobe's business activities in the quarter in which such charges occur. As a result, Adobe's management believes it is useful for itself and investors to review both GAAP information that includes such charges and non-GAAP measures of operating income and net income that exclude these charges to have a better understanding of the overall performance of Adobe's ongoing business operations and its performance in the periods presented. In accordance with GAAP, Adobe incurs investment gains and losses from its venture program. These charges are otherwise unrelated to Adobe's ongoing business operations and are excluded from its non-GAAP financial information. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion