Adobe Systems shares pop on upbeat outlook, earnings beat

No touch-up needed here.

Shares in Adobe Systems advanced in extended trading on Thursday after the software company, known for its flashplayer and image editor Photoshop, issued an upbeat sales outlook and posted better-than-expected first quarter results.

Adobe shares advanced 4 per cent in after-hours trade after the company said it is targeting revenue of about $1.73bn in the current quarter on adjusted earnings of 94 cents a share. That was ahead of consensus Wall Street estimates of $1.71bn and 90 cents.

That accompanied fiscal first quarter results that topped expectations. Profits rose to $398.4m, or 80 cents a share, in the three months ended March 3, compared with $254.3m, or 50 cents a share, in the year ago period. Adjusting for one-time items, earnings of 94 cents eclipsed the 87 cents that analysts on Wall Street were looking for.

Revenues climbed nearly 22 per cent to a record $1.68bn, above forecasts of $1.65bn.

Adobe has been moving away from a traditional software licensing model to a cloud-based subscription model. Its shares have climbed nearly 19 per cent so far this year following a 9.6 per cent advance last year.