Adobe Systems Inc. on Tuesday gave an outlook for its coming fiscal year that was lower than Wall Street expected, pummeling the company's shares.
In recent after-hours trading, Adobe shares dropped 8.8% to $77.65. Through Tuesday's close, the stock had risen 26% in the past 12 months.
Adobe projected adjusted earnings for its 2016 business year of about $2.70 a share on about $5.7 billion in revenue. Analysts polled by Thomson Reuters had forecast per-share earnings of $3.19 and revenue of $5.93 billion.
Adobe, famous for its publishing software like Photoshop that is widely used by creative types, as well as popular Flash software, has benefited recently from higher digital-media revenue. It forecast digital-media revenue growth of about 20% in fiscal 2016 and annually through 2018.
In its third quarter of this year, the latest available, the company posted digital media revenue of $769.7 million, up 24% from the same period a year earlier.
The company in mid-September announced a leadership shake-up, as David Wadhwani, its senior vice president and general manager for digital media, left to take a chief executive post at AppDynamics Inc. Bryan Lamkin, who previously headed the document cloud business, stepped up to lead a combined digital-media business.
On Tuesday, the San Jose, Calif., company also provided longer-term forecasts, saying it expected compound annual growth rates from 2015 to 2018 of about 20% for revenue and about 30% for adjusted earnings per share.
(By Nathan Becker)