M+E Daily

Adobe continues to see increased applications for its Adobe Sensei artificial intelligence (AI) and machine learning (ML) platform and expects the strong overall momentum it saw across its business in the first half of this fiscal year to continue in the back half of 2019, according to Shantanu Narayen, the company’s CEO and president.

Highlights of the company’s second quarter (ended May 31) included the global launch of Adobe Experience Platform, the industry’s first real-time platform for customer experience management, he pointed out June 18 during an earnings call with analysts.

Experience Platform “stitches together data from across the enterprise,” he said, and that enables real-time customer profiles that leverage Sensei AI and ML, according to the company. Companies already using Experience Platform in beta include Best Buy, Home Depot, Sony Interactive Entertainment and Verizon Wireless, he noted.

“We are investing very heavily in … Sensei in the Experience Cloud,” he said during the earnings call Q&A. In commerce, Sensei can be used to enhance search, so somebody can more easily “find the right shopping good that you’re interested in,” he told analysts, adding: “That’s a game changer in targeting and in what we can do around how we can optimize targets and recommendations [is] another area where AI is certainly beneficial.”

In addition to that, as part of the Experience Platform, “we actually now have modules … to actually augment the Experience Cloud,” he said.

Calling Q2 “another strong quarter” for Adobe, he said the company saw “record revenue and continued growth across Adobe Creative Cloud, Adobe Document Cloud and Adobe Experience Cloud.”

Total Adobe Q2 revenue grew 25% from a year ago to $2.74 billion as subscription revenue soared to $2.46 billion from $1.92 billion, while product revenue increased to $152.82 million from $150.99 million and services and support revenue grew to $135.37 million from $121.24 million.

In Adobe’s Digital Media business, there was “strong revenue growth” in Creative Cloud and Document Cloud in Q2, Narayen told analysts. Q2 Creative revenue grew 22% to $1.59 billion, he noted, calling mobile a “tailwind” in the Digital Media business. “We’re driving significant increases in mobile traffic and member sign-ups for our offerings,” he said.

A “key part” of Adobe’s Creative Cloud growth strategy is “appealing to new segments of users and, on that front, Adobe Spark, is “rapidly gaining popularity among creators from the classroom to the boardroom,” he told analysts. Spark enables users to easily turn ideas into compelling stories, graphics and webpages, and Spark traffic on Web and mobile “more than doubled year-over-year,” he said. In Q2, Adobe expanded Spark’s “global footprint,” adding support for five new languages: Brazilian-Portuguese, French, German, Italian and Spanish, he noted.

Adobe also “expanded our vision of platforms” to include social media channels like Facebook, Instagram and YouTube, he said. Adobe’s Premiere Rush video editing software is “rapidly becoming the solution of choice for YouTubers and social video creators,” he said, pointing out it’s available on Android, iOS, Mac and Windows.

Experience design, meanwhile, is “one of the most explosive creative categories and we continue to innovate in this space” with Adobe XD, the company’s design system for user experience and user interface.

Adobe also continues to expand Creative Cloud with value-added services, he noted. For example, Adobe Stock, its “fast-growing service for stock images, videos, and millions of additional creative assets, grew greater than 25 percent” from a year ago, he said.

Q2 Document Cloud revenue hit a record $296 million (up 22% from last year) and Adobe grew Document Cloud annual recurring revenue to $921 million, “driven by continued strength in Acrobat subscription adoption,” he said.

Mobile is the “next frontier” for digital documents and the company’s flagship Adobe Reader for mobile and Adobe Scan apps continued to “gain traction,” he told analysts. Adobe Scan, meanwhile, has become the leading scanning app on iOS and Android, he said.

In Adobe’s Digital Experience business, it achieved record Experience Cloud revenue of $784 million for Q2, growth of 34% year-over-year, he also said.