Adobe got off to a strong start this year and continues to see a lot of opportunities across its Creative Cloud, Document Cloud and Experience Cloud businesses, according to Shantanu Narayen, the company’s CEO and president.
“We’re investing in all three” of those core businesses, he said March 14 during the Q&A of an earnings call with analysts for Adobe’s first quarter (ended March 1).
Adobe will be showing new Experience Cloud capabilities at both its upcoming Adobe Summit and the NAB Show, both in Las Vegas, underscoring the investment Adobe continues to make in “the core cloud infrastructure for us to not only deliver value, but over time reduce” the cost of goods sold, “because we’re going to get more efficient there, as well as on” artificial intelligence (AI) and machine learning (ML), Narayen told analysts.
The company has a “really comprehensive roadmap,” he said, adding: “Given the opportunity, when you have a $100 billion addressable market, I think we’ve done a good job of balancing the long-term while continuing to deliver great value for shareholders.”
Earlier on the call, he pointed out that Adobe achieved Experience Cloud revenue of $743 million in Q1, which represented 34% year-over-year growth.
“The success of our Digital Experience business is bolstered by several industry tailwinds: The mandate for enterprises and organizations to digitally transform their businesses and the need to deliver the world-class, end-to-end customer experiences consumers have come to expect,” he said, adding: “More and more businesses are choosing Adobe Experience Cloud – the industry’s only end-to-end solution for marketing, advertising, analytics and commerce – serving both B2C and B2B customers.”
On the Creative Cloud side, he pointed to new applications that are coming out on iPads, adding there’s a “significant amount of product innovation that’s underway that’ll be delivered to customers.”
Creative Cloud is “democratizing creativity by delivering innovative new ways for everyone — from businesses, to students, to creative professionals, to hobbyists — to tell their story,” he told analysts. Beyond film and photography, Adobe is “pushing the boundaries of creativity onto new canvases and broadening the appeal of Creative Cloud to entirely new segments of users,” he said, adding: “New media types, including 3D, video and augmented reality, continue to emerge, which will enable more immersive and engaging digital experiences.”
In January, Adobe bought Allegorithmic, which offers “the industry standard in tools for 3D material and texture creation for gaming and entertainment,” he said. The addition of Allegorithmic “further expands Creative Cloud into interactive content design and allows us to better equip video game creators, Visual FX artists working in film and television, designers and marketers, to deliver the next generation of immersive experiences,” he told analysts.
Premiere Rush Creative Cloud, Adobe’s video editing app for social media creators, meanwhile, is “expanding its footprint to Android, and was recently showcased” at Samsung’s Galaxy S10 event, he noted.
Adobe also continues to innovate with Adobe XD, its solution for designing and prototyping websites and apps, adding “expanded collaboration, prototyping and voice capabilities – all supported by a growing ecosystem of plug-ins and integrations” with companies including Microsoft, he said.
At the same time, “overall momentum” for Acrobat is being “fueled by strong demand for Adobe PDF among individuals and businesses worldwide,” he said, adding its “mobile footprint continues to grow.” Adobe Reader and Adobe Scan downloads “have now surpassed 600 million, and our partnership with Samsung contributed significantly to downloads of Adobe Scan in Q1,” he also said, noting Adobe Reader is now available in the “Made for Samsung” section of the Galaxy App Store, “increasing our potential reach to millions of Samsung smartphone users.”
Adobe recently launched the “PDF Like a Boss” global ad campaign that’s designed “to drive further awareness for new Document Cloud, Acrobat and Adobe PDF capabilities,” he said. Last month, Adobe announced a partnership with the PGA Tour, which will feature Adobe’s new campaign in TV coverage for 10 tournaments this year, he pointed out. And Adobe Sign has “strong momentum and has become the e-signature solution of choice for organizations across all industries,” he said.
Adobe reported total Q1 revenue grew to $2.6 billion from $2.1 billion a year ago, while profit increased to $674.2 million ($1.36 a share) from $583.1 million ($1.17 a share).