Feeds

Adobe all smiles as beret bods spaff cash on non-cloud Creative Suite

Perpetual licence stampede spurs 15% profit spike

Reducing security risks from open source software

A late rally from Adobe customers wanting to buy software on a perpetual license before that option closed this month, coupled with a swelling base of cloudy converts, helped boost the developer's coffers in its fiscal second quarter.

Adobe turned over $1.07bn in revenues in the three-month period ended 30 May, up from $1.01bn a year earlier; traditional product sales crashed 25 per cent to $479.2m; subscriptions soared 87.6 per cent to $476.7m; and service and support was up marginally to $112.3m.

Operating profits in Q2 leaped to $135m from $111.3m and net profit came in at $88.5m, up from the year-ago quarter's $76.5m.

The quarter closed with 2.3 million paid Creative Cloud subscribers, up 464k sequentially. Creative Cloud annualised recurring revenues stood at $1.2bn and the total Digital Media ARR grew to $1.38bn.

Chief beanie Mark Garrett confirmed Q2 was the last quarter that it "broadly offered perpetual volume licensing of CS6 (Creative Suite 6)" via channel partners.

"As a result, there was a high demand by customers serviced by the channel who wanted to add to their perpetual seat capacity," he told analysts last night in a conference call.

He added that more customers WILL "migrate" to the fluffy white stuff - let's face it, punters and partners were given no other option, no matter how hard some kicked and screamed.

Garrett told analysts that enterprise customer cloud adoption is "proceeding well" with the direct sales reps signing new ones to Enterprise License Terms (ELT), and converting existing customers. The company said it does not reveal the direct/ indirect sales split.

The company previously revealed it had 12.8 million punters worldwide and last night forecast that 3.3 million will be in the Creative Cloud by the end of this fiscal, some 300k seats above initial predictions.

CEO Shantanu Narayen reckons 20 per cent of the existing Creative Cloud crowd are entirely new to the business, which he claimed has skewed the stats.

"We are not providing the longer term numbers at this time because we are really focused on driving financial performance in the second half."

He urged the market watchers on the conference call to look at the "big picture", that it is "making good traction", winning new accounts and is about to expand the Creative Cloud to target even more newbies.

Adobe will later today unveil a broad set of "Creative Cloud innovations" including desktop and mobile applications, new services and specialised offer for "key customer segments", targeting "hobbyists and consumers" as well as business users.

"This is our biggest update since CS6," said Narayen.

The cloudy wobble last month - the Creative Cloud was down for 27 hours - may not have soothed any concerns that customers have about moving to a different consumption model.

The CEO admitted "we have to be even more vigilant about making sure that we have 100 per cent up-time. The outage that occurred in Q2 should never have really happened... we have learned from it as well as introduced additional safeguards and redundancies as a preventative measure". ®

Mobile application security vulnerability report

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Nadella: Apps must run on ALL WINDOWS – PCs, slabs and mobes
Phone egg, meet desktop chicken - your mother
White? Male? You work in tech? Let us guess ... Twitter? We KNEW it!
Grim diversity numbers dumped alongside Facebook earnings
HP, Microsoft prove it again: Big Business doesn't create jobs
SMEs get lip service - what they need is dinner at the Club
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.