Adobe Inc. ADBE is set to report first-quarter fiscal 2024 results on Mar 14.

For the fiscal first quarter, the company expects non-GAAP earnings of $5.10-$5.15 per share. The Zacks Consensus Estimate for earnings is pegged at $5.13 per share, indicating growth of 10.3% from the year-ago reported figure.

Adobe projects total revenues between $4.35 billion and $4.40 billion. The consensus mark for the same is pegged at $4.38 billion, implying growth of 15.3% from the year-ago reported figure.

The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average earnings surprise being 3.42%.

Adobe Inc. Price and EPS Surprise

 

Adobe Inc. price-eps-surprise | Adobe Inc. Quote

Factors to Consider

Solid momentum across the Digital Media and Digital Experience segments is likely to have driven top-line growth for the company in the to-be-reported quarter.

Robust Creative Cloud and Document Cloud are expected to have contributed well to the performance of the Digital Media segment in the fiscal first quarter. Adobe expects Digital Media revenues between $3.77 and $3.80 billion. The Zacks Consensus Estimate for the same is pegged at $3.78 billion, indicating year-over-year growth of 11.5%.

Growing momentum across the Adobe Express platform and benefits from the Frame.io acquisition are expected to have accelerated growth in Creative revenues in the quarter under review. Also, Adobe’s solid momentum in generative AI on the back of Firefly is likely to have been a major positive.

Strength across the Document Cloud enterprise business and Acrobat ecosystem is anticipated to have contributed well to Document Cloud revenues. The growing demand for PDF collaboration services is expected to have been a tailwind.

Growing Adobe Experience Cloud subscriptions on the heels of the rising adoption of Adobe Marketing Cloud, Adobe Analytics Cloud and Adobe Advertising Cloud is likely to have benefited Adobe’s Digital Experience segment in the quarter under review.

Strong demand for AEP and native apps and solid momentum across Data & Insights, Content and Workfront solutions are anticipated to have benefited the segment’s quarterly performance.

The company expects Digital Experience revenues between $1.27 and $1.29 billion. The Zacks Consensus Estimate for the same is pegged at $1.27 billion, indicating year-over-year growth of 8.2%.

However, the impacts of ongoing tensions between Russia and Ukraine are likely to have continued acting as headwinds in the quarter to be reported.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Adobe this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Adobe has an Earnings ESP of -0.19%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

ADBE currently has a Zacks Rank #2.