For immediate release Momentum Continues with Accelerated Creative Cloud and Adobe Marketing Cloud AdoptionSAN JOSE, Calif. - Dec. 11, 2014 - Adobe (Nasdaq:ADBE) today reported financial results for its fourth quarter and fiscal year 2014 ended Nov. 28, 2014.
Fourth Quarter Financial Highlights
Adobe achieved revenue of $1.073 billion, near the high end of the targeted range of $1.025 billion to $1.075 billion.
Adobe added 644 thousand net new Creative Cloud subscriptions in the quarter.
Creative Annualized Recurring Revenue ( ARR ) grew to $1.676 billion, and total Digital Media ARR grew to $1.947 billion.
Adobe Marketing Cloud revenue was $330 million with record bookings in the quarter.
Diluted earnings per share were $0.14 on a GAAP-basis, and $0.36 on a non-GAAP basis.
Cash flow from operations was $400 million.
Deferred revenue grew to a record $1.155 billion, and unbilled backlog grew to approximately $1.7 billion.
66 percent of Adobe's Q4 revenue was from recurring sources, compared to 44 percent of Q4 revenue in fiscal 2013.
The company repurchased approximately 1.8 million shares during the quarter, returning $127 million of cash to stockholders.
Fiscal Year 2014 Financial Highlights
Adobe achieved revenue of $4.147 billion and generated $1.288 billion in operating cash flow during the year.
The company reported annual GAAP earnings per share of $0.50 and non-GAAP earnings per share of $1.29.
Creative Cloud subscriptions grew by more than two million to 3.454 million. In addition, Adobe grew net new Digital Media ARR by more than $1 billion during the year.
Adobe Marketing Cloud achieved a record $1.170 billion in annual revenue, with record annual bookings that is above the company's target of 30 percent.
The company repurchased 10.9 million shares during the year, returning approximately $689 million of cash to stockholders.
A reconciliation between GAAP and non-GAAP results is provided at the end of this press release and on Adobe's website.
Adobe to Acquire Fotolia
Adobe today announced it has entered into a definitive agreement to acquire privately-held Fotolia, a leading marketplace for stock content. Fotolia will be integrated into Adobe Creative Cloud, providing current and future Creative Cloud members with the ability to access and purchase over 34 million images and videos, significantly simplifying and accelerating the design process. The acquisition of Fotolia cements Creative Cloud's role as a vibrant marketplace for creatives to buy and sell assets and services as well as showcase their talent to a worldwide audience. Adobe also plans to continue to operate Fotolia as a standalone stock service, accessible to anyone. Additional information is available in a separate press release .
Executive Quotes
"Adobe had an outstanding 2014. Creative Cloud adoption outpaced expectations and the acquisition of Fotolia will add a vibrant marketplace for our customers. Adobe Marketing Cloud, the leader in the explosive digital marketing category, continued to drive strong bookings at the worlds biggest brands, agencies and media companies, said Shantanu Narayen, Adobe president and chief executive officer.
2014 was a pivotal year for Adobe as we completed our business model transition, said Mark Garrett, Adobe executive vice president and chief financial officer. In 2015 we expect revenue and earnings to grow sequentially every quarter during the year.
Adobe to Webcast Earnings Conference Call
Adobe will webcast its fourth quarter and fiscal year 2014 earnings conference call today at 2:00 p.m. Pacific Time from its investor relations website: www.adobe.com/ADBE. Earnings documents, including Adobe management's prepared conference call remarks with slides, financial targets and an investor datasheet are posted to Adobe's investor relations website in advance of the conference call for reference. A reconciliation between GAAP and non-GAAP earnings results and financial targets is also provided on the website.
Forward-Looking Statements Disclosure
This press release contains forward-looking statements, including those related to business momentum, the strength of our cloud business and growth of our bookings, revenue and earnings, and our ability to complete and integrate the acquisition of Fotolia, all of 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: failure to develop, market and distribute products and services that meet customer requirements, introduction of new products and business models by competitors, failure to successfully manage transitions to new business models and markets, fluctuations in subscription renewal rates, risks associated with cyber-attacks and information security, potential interruptions or delays in hosted services provided by us or third parties, uncertainty in economic conditions and the financial markets, and failure to realize the anticipated benefits of past or future acquisitions.
For a discussion of these and other risks and uncertainties, please refer to Adobe's Annual Report on Form 10-K for our fiscal year 2013 ended Nov. 29, 2013 and Adobe's Quarterly Reports on Form 10-Q issued in fiscal year 2014.
The financial information set forth in this press release reflects estimates based on information available at this time. These amounts could differ from actual reported amounts stated in Adobe's Annual Report on Form 10-K for our year ended Nov. 28, 2014, which Adobe expects to file in Jan. 2015.
Adobe assumes no obligation to, and does not currently intend to, update these forward-looking statements.
About Adobe Systems Incorporated
Adobe is changing the world through digital experiences. For more information, visit www.adobe.com.
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