Financial Report Preview | Adobe (ADBE.US) Q4 financial report is about to be released, with several analysts giving a "buy" rating.

Adobe (ADBE.US) will release its fourth quarter report on December 11th in Eastern Time. Wall Street analysts expect the company to report a Q4 revenue of $5.54 billion, a 9.7% year-on-year increase, and an earnings per share of $4.66, a 9.1% year-on-year increase. In the past 30 days, the market's general expectation for Q4 earnings per share has been revised up by 0.1%. Revised earnings expectations are an important indicator for predicting potential investors' behavior towards a stock, indicating how analysts covering the stock as a whole have reevaluated their initial estimates during this period. Empirical research consistently shows a strong correlation between the trend of earnings estimate revisions and short-term stock price performance. Additionally, analysts' forecasts for some key metrics of the company will provide a more comprehensive perspective. Analyst evaluations show that Adobe's "Revenue - Digital Media" is expected to reach $4.11 billion, a 10.5% year-on-year increase. "Revenue - Publishing and Advertising" is expected to reach $589.7 million, a 10.7% year-on-year decrease. According to analysts' collective judgment, "Revenue - Digital Experience" is projected to reach $1.37 billion. This estimate suggests an 8.4% growth compared to the same period last year. Analysts expect the widespread estimate for "Revenue - Digital Media - Creative Cloud" to be $3.26 billion, a 9% year-on-year increase. "Revenue - Digital Media - Document Cloud" is expected to reach $843.05 million, a 16.9% year-on-year increase. Analysts' collective evaluation shows that "Revenue - Services and Other" is expected to be $1.8762 billion, a 9.7% year-on-year increase. "Revenue - Products" is expected to reach $1.1453 billion, a 0.5% year-on-year increase. "Digital Experience Subscription Revenue" is projected to reach $1.24 billion, a 10.5% year-on-year increase. According to analysts' collective evaluation, "Net Revenue - Subscription" should reach $5.23 billion, a 9.8% year-on-year increase. Analysts predict that "Business Segment - Digital Media - Creative ARR (Annual Recurring Revenue)" will reach $13.87 billion, compared to $12.49 billion reported in the same period last year. It is expected that the "Business Segment - Digital Media - Total Digital Media ARR (Annual)" may reach $17.31 billion, compared to $15.33 billion reported in the same period last year. The expected "Business Segment - Digital Media - Document Services ARR (Annual)" is $3.44 billion, compared to $2.84 billion in the same period last year. It is worth noting that before Adobe's fourth quarter report was released, most analysts gave it a buy rating. Piper Sandler's Brent Bracelin reiterated his buy rating on December 4th and emphasized that Adobe is a large software stock with prospects for 2025. Bracelin remains optimistic about the company's strong subscription growth and improving cRPO indicator (Current Remaining Performance Obligation, measuring future subscription revenue under contract). Furthermore, this analyst expects Adobe's earnings per share to grow by over 13% annually, potentially reaching over $30 by 2028. Similarly, DA Davidson analyst Gil Luria reaffirmed a buy rating for Adobe on December 1st. He believes that Adobe has the ability to increase its already strong profit margins through scale and contributions from artificial intelligence, "benefiting from the company's market leadership and continuous product innovation, driving these profits is a lasting growth engine." Luria also emphasized that Adobe's current valuation is the lowest among its large-cap peers at 26 times earnings per share. He attributes this to negative expectations regarding "AI short thesis" that are unfounded, and believes the company's profit potential remains strong.