ADBE Q4 2022 Earnings

Call Details

• Call Title: Adobe Q4 2022 Earnings Call
• Date: December 15, 2022 at 10:00 PM UTC
• Management Team:
  • Jonathan Voss (Vice President of Investor Relations)
  • Shantanu Narayen (Chairman and CEO)
  • David Wadhwani (President of Digital Media)
  • Anil Chakravarthy (President of Digital Experience)
  • Dan Dern (Executive Vice President and CFO)

Call Summary

Financial Performance

• Adobe reported fiscal year 2022 record revenue of $17.61B, which the company stated represents 15% year-over-year growth on a constant currency adjusted basis and 12% on a reported basis.
• Q4 revenue was $4.53B, described as 14% year-over-year growth in adjusted/constant-currency terms and 10% on a reported basis.
• Fiscal year GAAP EPS was $10.10 and fiscal year non-GAAP EPS was $13.71, while Q4 GAAP diluted EPS was $2.53 and Q4 non-GAAP diluted EPS was a record $3.60.
• Cash flows from operations for fiscal year 2022 were $7.84B and Q4 operating cash flow was a record $2.33B, which the company said was up 14% year-over-year in the quarter.
• RPO exiting Q4 was $15.19B, which the company reported as up 9% year-over-year or 12% when factoring in a 3-percentage-point FX headwind.
• Segment highlights for Q4 included digital media revenue of $3.30B and digital experience revenue of $1.15B, with creative revenue of $2.68B and Document Cloud revenue of $619M.

Guidance

• Fiscal year 2023 revenue target was reiterated at $19.1B to $19.3B and does not contemplate the planned Figma acquisition.
• Fiscal year 2023 digital media net new ARR target was stated as approximately $1.65B.
• Fiscal year 2023 digital media segment revenue guidance was $13.9B to $14.0B.
• Fiscal year 2023 digital experience revenue guidance was $4.925B to $5.025B, with subscription revenue of $4.375B to $4.425B.
• Fiscal year 2023 tax guidance was approximately 22% on a GAAP basis and 18.5% on a non-GAAP basis.
• Fiscal year 2023 GAAP EPS guidance was $10.75 to $11.05 and non-GAAP EPS guidance was $15.15 to $15.45.
• Q1 fiscal 2023 guidance included total revenue of $4.60B to $4.64B, digital media net new ARR of approximately $375M, and Q1 non-GAAP EPS of $3.65 to $3.70.
• The company provided a seasonality outlook that Q1 is seasonally light, Q2 sequentially higher, Q3 a seasonal dip, and Q4 a strong finish.
• The company cautioned that guidance assumes ongoing macro uncertainty but reaffirmed targets provided at its analyst meeting in October.