Adobe Systems Inc. (NASDAQ:ADBE) weighed in with better-than-expected third-quarter results, but the graphics and design company forecast fourth-quarter sales below expectations, prompting shares to slide in after-hours trading.
The maker of Adobe’s Creative Suite 5 software forecast fourth-quarter adjusted earnings in the range of 48 to 54 cents a share on revenue between $950 million to $1 billion.
The fourth-quarter sales forecast disappointed the Street, as analysts were looking for adjusted earnings of 53 cents a share on revenue of $1.03 billion, according to a poll by Thomson Reuters.
For the fiscal third quarter, Adobe posted net income of $230.1 million, or 44 cents a share, compared with year-ago earnings of $136.0 million, or 26 cents a share. Adjusted earnings rose to 54 cents a share, up from 35 cents, one year ago.
Revenue improved 42% to $990.3 million, compared with last year’s sales of $697.5 million.
The results easily beat the Street’s view; analysts had predicted adjusted earnings of 49 cents a share on revenue of $984.07 million.
"Strong performance in each of our major businesses contributed to record revenue and strong earnings in Q3," said Shantanu Narayen, president and CEO of Adobe, in a release. "We remain bullish about Adobe's long-term role in enabling the transformation of content and applications across industries."
Shares of Adobe Systems fell 17 cents in Tuesday’s trading, before falling another $4.27, or 12.9%, in electronic trading after the market closed.