One analyst thinks concerns from AI could be overshadowing strong subscriber growth.
Adobe Inc ADBE could highlight its strong subscriber revenue and growth when the company reports fourth-quarter results after market close Wednesday.
Earnings Estimates: Analysts expect Adobe to report fourth-quarter revenue of $5.54 billion, up from $5.05 billion in last year's fourth quarter, according to data from Benzinga Pro.
The company has beaten analyst revenue estimates in seven straight quarters and nine of the last 10 quarters overall.
Analysts expect the company to report earnings per share of $4.65 in the fourth quarter, compared to $4.27 in last year's fourth quarter. The company has beaten analyst estimates for earnings per share in 11 straight quarters.
Guidance from the company sees fourth-quarter revenue coming in a range of $5.50 to $5.55 billion and earnings per share coming in a range of $4.63 to $4.68.
Read Also: How Nvidia, PayPal, Adobe Are Driving GenAI's Productivity Revolution: Report
What Analysts Are Saying: Adobe could offer a compelling risk-reward profile ahead of 2025, Piper Sandler analyst Brent Bracelin recently said.
The analyst reiterated an Overweight rating and $635 price target on the stock in the note.
Bracelin said with shares down year-to-date, the stock could go from laggard to leader.
Concerns of threats on Adobe's business from artificial intelligence could be overshadowing healthy subscription growth trends, the analyst added.
The analyst said the earnings report could show the durability of subscription growth and high operating margins.
Adobe Express Mobile is also attracting new users with quarterly downloads over 10 million, Bracelin said.
Here are other analyst ratings on Adobe and their price targets:
Citigroup: Maintained Neutral rating, lowered price target from $616 to $590 BMO Capital: Maintained Outperform rating, lowered price target from $600 to $580 RBC Capital: Reiterated Outperform rating, price target $610
Key Items to Watch: Subscription revenue and strength will be one of the biggest areas to watch, as shared by Bracelin above.
Investors and analysts will also be looking to hear any comments on how AI is impacting the company and what Adobe is doing to offset this competitive threat.
Updates on new products and their initial reaction will also be an item to watch.
With this being the fourth-quarter financial results, analysts and investors will also be waiting to see if Adobe shares guidance for the next fiscal year.
ADBE Price Action: Adobe stock is down 0.3% to $545.23 on Wednesday versus a 52-week trading range of $433.98 to $638.25. Adobe stock is down 6% year-to-date in 2024.
Read Next:
Adobe Stock To Turn From Laggard To Leader, Analysts Highlight 'AI Monetization Opportunities' From MAX Creativity Conference
Photo: Shutterstock
ADBEAdobe Inc$548.050.18%Overview Rating:Good62.5%Technicals Analysis1000100Financials Analysis400100WatchlistOverviewMarket News and Data brought to you by Benzinga APIs