California-based Computer Software Developer, Adobe Systems Inc. (NASDAQ: ADBE) reported results for the third quarter of 2012 ended Aug 31, 2012.
Net sales increased by 7% to $1080.58 million from that of $1013.21 million in Aug 2011. Operating profit had increased by 2% to $278.3 million from that of $274.11 million. Net income increased by 3% to $201.36 million from $195.1 million. Net cash from operations for the third quarter 2012 were $263.34 million.
The increase in the revenues was mainly from the creative cloud subscriptions. ADBE had recently adopted creative cloud with approximately 8000 subscriptions per week for the third quarter and even its customers have quickly migrated from the Creative Suite perpetual licensing model to new Creative Cloud subscriptions which lead to higher net revenues. Digital Marketing Suite also achieved record quarterly revenue with 40 percent year-over-year growth.
In proportion to the revenues, the operating profit did not increase as much, which is mainly due to the significant increase in the cost of sales, general administrative expenses and marketing expenses. Net profit rose by 3% because of the increase in the non operating income through investment gains and interest income.
As on Aug 31, 2012, it had total assets worth $9,630.01 million including $1,162.38 million as cash and its equivalents. Total liabilities were $3,191.32 million, among which 37% were current and the remaining was long term. Total stockholdersâ€™ equity was $6,438.69 million including $6815.38 million as retained earnings.
The company has an average of 494.05 million common shares for basic EPS calculation and 499.76 million common shares for diluted EPS calculation by adding stock options and restricted stock which makes Earning per share (basic) as $0.41 compared to $0.39 in August 2011 and Diluted EPS as $0.40 compared to $0.39 in 2011.
Executive Vice President and CFO, Mark Garrett quoted that Adobe is on a path to drive millions of subscribers to their Creative Cloud offering, as well as build a billion dollar SaaS business in Digital Marketing. He believes that this will drive higher long-term growth and create a large recurring revenue stream for the company.
Adobeâ€™s shares opened today at $33.25, slightly higher than its previous close of $33.12 and have been trading volatile today in the range of $33 and $33.97. The reached its 52 week high of $34.78 in April 2012 and is currently trading very close to it.