(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
Title of Each Class | Trading Symbol | Name of Each Exchange on Which Registered | ||||||
Exhibit Number | Exhibit Description | |||||||
99.1 | ||||||||
104 | Cover Page Interactive Data File (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) |
ADOBE INC. | ||||||||
By: | /s/ DANIEL DURN | |||||||
Daniel Durn | ||||||||
Executive Vice President and Chief Financial Officer |
Digital Media net new ARR | ~$1.70 billion | |||||||
Earnings per share1 | GAAP: $10.85 to $11.15 | Non-GAAP: $15.30 to $15.60 |
Total revenue | $4.75 billion to $4.78 billion | |||||||
Digital Media net new ARR | ~$420 million | |||||||
Digital Media segment revenue | $3.45 billion to $3.47 billion | |||||||
Digital Experience segment revenue | $1.21 billion to $1.23 billion | |||||||
Digital Experience subscription revenue | $1.06 billion to $1.08 billion | |||||||
Tax rate | GAAP: ~21.5% | Non-GAAP: ~18.5% | ||||||
Earnings per share1 | GAAP: $2.65 to $2.70 | Non-GAAP: $3.75 to $3.80 |
Three Months Ended | |||||||||||
March 3, 2023 | March 4, 2022 | ||||||||||
Revenue: | |||||||||||
Subscription | $ | 4,373 | $ | 3,958 | |||||||
Product | 120 | 145 | |||||||||
Services and other | 162 | 159 | |||||||||
Total revenue | 4,655 | 4,262 | |||||||||
Cost of revenue: | |||||||||||
Subscription | 434 | 393 | |||||||||
Product | 8 | 10 | |||||||||
Services and other | 126 | 109 | |||||||||
Total cost of revenue | 568 | 512 | |||||||||
Gross profit | 4,087 | 3,750 | |||||||||
Operating expenses: | |||||||||||
Research and development | 827 | 701 | |||||||||
Sales and marketing | 1,301 | 1,158 | |||||||||
General and administrative | 331 | 269 | |||||||||
Amortization of intangibles | 42 | 42 | |||||||||
Total operating expenses | 2,501 | 2,170 | |||||||||
Operating income | 1,586 | 1,580 | |||||||||
Non-operating income (expense): | |||||||||||
Interest expense | (32) | (28) | |||||||||
Investment gains (losses), net | 1 | (9) | |||||||||
Other income (expense), net | 43 | — | |||||||||
Total non-operating income (expense), net | 12 | (37) | |||||||||
Income before income taxes | 1,598 | 1,543 | |||||||||
Provision for income taxes | 351 | 277 | |||||||||
Net income | $ | 1,247 | $ | 1,266 | |||||||
Basic net income per share | $ | 2.72 | $ | 2.68 | |||||||
Shares used to compute basic net income per share | 459 | 473 | |||||||||
Diluted net income per share | $ | 2.71 | $ | 2.66 | |||||||
Shares used to compute diluted net income per share | 460 | 475 |
March 3, 2023 | December 2, 2022 | ||||||||||
ASSETS | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 4,072 | $ | 4,236 | |||||||
Short-term investments | 1,581 | 1,860 | |||||||||
Trade receivables, net of allowances for doubtful accounts of $17 and $23, respectively | 1,801 | 2,065 | |||||||||
Prepaid expenses and other current assets | 888 | 835 | |||||||||
Total current assets | 8,342 | 8,996 | |||||||||
Property and equipment, net | 1,967 | 1,908 | |||||||||
Operating lease right-of-use assets, net | 402 | 407 | |||||||||
Goodwill | 12,792 | 12,787 | |||||||||
Other intangibles, net | 1,354 | 1,449 | |||||||||
Deferred income taxes | 826 | 777 | |||||||||
Other assets | 984 | 841 | |||||||||
Total assets | $ | 26,667 | $ | 27,165 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
Current liabilities: | |||||||||||
Trade payables | $ | 308 | $ | 379 | |||||||
Accrued expenses | 1,469 | 1,790 | |||||||||
Debt | — | 500 | |||||||||
Deferred revenue | 5,357 | 5,297 | |||||||||
Income taxes payable | 222 | 75 | |||||||||
Operating lease liabilities | 81 | 87 | |||||||||
Total current liabilities | 7,437 | 8,128 | |||||||||
Long-term liabilities: | |||||||||||
Debt | 3,630 | 3,629 | |||||||||
Deferred revenue | 120 | 117 | |||||||||
Income taxes payable | 536 | 530 | |||||||||
Operating lease liabilities | 415 | 417 | |||||||||
Other liabilities | 323 | 293 | |||||||||
Total liabilities | 12,461 | 13,114 | |||||||||
Stockholders’ equity: | |||||||||||
Preferred stock | — | — | |||||||||
Common stock | — | — | |||||||||
Additional paid-in-capital | 10,284 | 9,868 | |||||||||
Retained earnings | 29,435 | 28,319 | |||||||||
Accumulated other comprehensive income (loss) | (307) | (293) | |||||||||
Treasury stock, at cost | (25,206) | (23,843) | |||||||||
Total stockholders’ equity | 14,206 | 14,051 | |||||||||
Total liabilities and stockholders’ equity | $ | 26,667 | $ | 27,165 |
Three Months Ended | |||||||||||
March 3, 2023 | March 4, 2022 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net income | $ | 1,247 | $ | 1,266 | |||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Depreciation, amortization and accretion | 212 | 213 | |||||||||
Stock-based compensation | 416 | 322 | |||||||||
Unrealized investment (gains) losses, net | 3 | 17 | |||||||||
Other non-cash adjustments | (33) | 153 | |||||||||
Changes in deferred revenue | 63 | 141 | |||||||||
Changes in other operating assets and liabilities | (215) | (343) | |||||||||
Net cash provided by operating activities | 1,693 | 1,769 | |||||||||
Cash flows from investing activities: | |||||||||||
Purchases, sales and maturities of short-term investments, net | 287 | (26) | |||||||||
Purchases of property and equipment | (101) | (100) | |||||||||
Purchases and sales of long-term investments, intangibles and other assets, net | (30) | (28) | |||||||||
Acquisitions, net of cash acquired | — | (106) | |||||||||
Net cash provided by (used for) investing activities | 156 | (260) | |||||||||
Cash flows from financing activities: | |||||||||||
Repurchases of common stock | (1,400) | (2,400) | |||||||||
Taxes paid related to net share settlement of equity awards, net of proceeds from treasury stock re-issuances | (95) | (175) | |||||||||
Other financing activities, net | (19) | (29) | |||||||||
Net cash used for financing activities | (2,014) | (2,604) | |||||||||
Effect of exchange rate changes on cash and cash equivalents | 1 | (10) | |||||||||
Net change in cash and cash equivalents | (164) | (1,105) | |||||||||
Cash and cash equivalents at beginning of period | 4,236 | 3,844 | |||||||||
Cash and cash equivalents at end of period | $ | 4,072 | $ | 2,739 |
(In millions, except per share data) | Three Months Ended | ||||||||||||||||
March 3, 2023 | March 4, 2022 | December 2, 2022 | |||||||||||||||
Operating income: | |||||||||||||||||
GAAP operating income | $ | 1,586 | $ | 1,580 | $ | 1,505 | |||||||||||
Stock-based and deferred compensation expense | 417 | 312 | 392 | ||||||||||||||
Amortization of intangibles | 95 | 101 | 100 | ||||||||||||||
Acquisition-related expenses (*) | 33 | — | 26 | ||||||||||||||
Non-GAAP operating income | $ | 2,131 | $ | 1,993 | $ | 2,023 | |||||||||||
Net income: | |||||||||||||||||
GAAP net income | $ | 1,247 | $ | 1,266 | $ | 1,176 | |||||||||||
Stock-based and deferred compensation expense | 417 | 312 | 392 | ||||||||||||||
Amortization of intangibles | 95 | 101 | 100 | ||||||||||||||
Acquisition-related expenses (*) | 33 | — | 26 | ||||||||||||||
Investment (gains) losses, net | (1) | 9 | (4) | ||||||||||||||
Income tax adjustments | (45) | (86) | (15) | ||||||||||||||
Non-GAAP net income | $ | 1,746 | $ | 1,602 | $ | 1,675 | |||||||||||
Diluted net income per share: | |||||||||||||||||
GAAP diluted net income per share | $ | 2.71 | $ | 2.66 | $ | 2.53 | |||||||||||
Stock-based and deferred compensation expense | 0.91 | 0.66 | 0.84 | ||||||||||||||
Amortization of intangibles | 0.21 | 0.21 | 0.21 | ||||||||||||||
Acquisition-related expenses (*) | 0.07 | — | 0.06 | ||||||||||||||
Investment (gains) losses, net | — | 0.02 | (0.01) | ||||||||||||||
Income tax adjustments | (0.10) | (0.18) | (0.03) | ||||||||||||||
Non-GAAP diluted net income per share | $ | 3.80 | $ | 3.37 | $ | 3.60 | |||||||||||
Shares used in computing diluted net income per share | 460 | 475 | 466 |
First Quarter Fiscal 2023 | |||||||||||
Effective income tax rate: | |||||||||||
GAAP effective income tax rate | 22.0 | % | |||||||||
Income tax adjustments | 0.5 | ||||||||||
Stock-based and deferred compensation expense | (3.0) | ||||||||||
Amortization of intangibles | (0.7) | ||||||||||
Acquisition-related expenses (*) | (0.3) | ||||||||||
Non-GAAP effective income tax rate (**) | 18.5 | % | |||||||||
(Shares in millions) | Fiscal Year 2023 | ||||||||||||||||||||||
Low | High | ||||||||||||||||||||||
Diluted net income per share: | |||||||||||||||||||||||
GAAP diluted net income per share | $ | 10.85 | $ | 11.15 | |||||||||||||||||||
Stock-based and deferred compensation expense | 3.96 | 3.94 | |||||||||||||||||||||
Amortization of intangibles | 0.82 | 0.82 | |||||||||||||||||||||
Acquisition-related expenses (*) | 0.15 | 0.15 | |||||||||||||||||||||
Income tax adjustments | (0.48) | (0.46) | |||||||||||||||||||||
Non-GAAP diluted net income per share | $ | 15.30 | $ | 15.60 | |||||||||||||||||||
Shares used to compute diluted net income per share | 456 | 456 |
(Shares in millions) | Second Quarter Fiscal 2023 | ||||||||||||||||||||||
Low | High | ||||||||||||||||||||||
Diluted net income per share: | |||||||||||||||||||||||
GAAP diluted net income per share | $ | 2.65 | $ | 2.70 | |||||||||||||||||||
Stock-based and deferred compensation expense | 0.97 | 0.96 | |||||||||||||||||||||
Amortization of intangibles | 0.21 | 0.21 | |||||||||||||||||||||
Acquisition-related expenses (*) | 0.05 | 0.05 | |||||||||||||||||||||
Income tax adjustments | (0.13) | (0.12) | |||||||||||||||||||||
Non-GAAP diluted net income per share | $ | 3.75 | $ | 3.80 | |||||||||||||||||||
Shares used to compute diluted net income per share | 458 | 458 |
Second Quarter Fiscal 2023 | |||||||||||
Effective income tax rate: | |||||||||||
GAAP effective income tax rate | 21.5 | % | |||||||||
Stock-based and deferred compensation expense | (3.1) | ||||||||||
Amortization of intangibles | (0.7) | ||||||||||
Acquisition-related expenses (*) | (0.2) | ||||||||||
Income tax adjustments | 1.0 | ||||||||||
Non-GAAP effective income tax rate (**) | 18.5 | % |
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Document and Entity Information Document |
Mar. 15, 2023 |
---|---|
Entity Information [Line Items] | |
Entity Central Index Key | 0000796343 |
Amendment Flag | false |
Document Type | 8-K |
Document Period End Date | Mar. 15, 2023 |
Entity Registrant Name | ADOBE INC. |
Entity Incorporation, State or Country Code | DE |
Entity File Number | 0-15175 |
Entity Tax Identification Number | 77-0019522 |
Entity Address, Address Line One | 345 Park Avenue |
Entity Address, City or Town | San Jose |
Entity Address, State or Province | CA |
Entity Address, Postal Zip Code | 95110-2704 |
City Area Code | 408 |
Local Phone Number | 536-6000 |
Written Communications | false |
Soliciting Material | false |
Pre-commencement Tender Offer | false |
Pre-commencement Issuer Tender Offer | false |
Title of 12(b) Security | Common Stock, $0.0001 par value per share |
Trading Symbol | ADBE |
Security Exchange Name | NASDAQ |
Entity Emerging Growth Company | false |
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