Adobe shares tumble as Q1 results hit by failed Figma bid
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The news: Shares in Adobe tanked in after-hours trading on the Nasdaq after the US design software company posted underwhelming results for the quarter to 1 March 2024.
The numbers: Adobe shares fell 10% in after-hours trading to USD513.52 ($780.50) by 9:00am AEDT, after closing the day 0.54% lower.
In its results for the first quarter, Adobe reported revenue of USD5.2 billion, up 11% compared to the prior corresponding period. However, general accepted accounting principles (GAAP) net income halved to USD620 million and non-GAAP net income was USD2.05 billion, while revenue costs and operating expenses climbed.
Adobe also reported a USD1 billion acquisition termination fee for its failed takeover of design software company Figma.
The context: San Jose-based Adobe said its Q1 results reflected "strong customer adoption" of its products and services, and announced a new $25 billion share repurchase program for its shareholders.
Canva rival Adobe, which is developing its own generative AI tool Firefly, saw stock fall last month over concerns that competing AI-powered software could hit sales.
What they said: Adobe's chair and CEO Shantanu Narayen said: “Adobe drove record Q1 revenue demonstrating strong momentum across Creative Cloud, Document Cloud and Experience Cloud".
“We’ve done an incredible job harnessing the power of generative AI to deliver groundbreaking innovation across our product portfolio.”
The source: Adobe earnings release
