Skip to content
AnalystLens

ADOBE INC. Annual Report, Year Ended Dec 1, 2000

Filing Date
Filed February 26, 2001
Period End
December 1, 2000
Security
ADBE
In the record · 2016–202610-K1110-Q338-K104

ADBE filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 104 current reports (8-K) between 2016 and 2026.

  1. FY2018 annual report10-K · Jan ’19Jan ’19
  2. Leadership change8-K · Jun ’21Jun ’21
  3. Leadership change8-K · Apr ’25Apr ’25

01—Abstract

Summary

Summary of the 10-K filed February 26, 2001. Cited figures are marked; the original filing is the authoritative source.

Adobe Systems Incorporated (ADBE) reported strong fiscal 2000 results for the year ended December 1, 2000, with revenue rising 25% to $1,266.4 milliona from $1,015.4 million, and net income increasing 21% to $287.8 million, or $1.13 per diluted share (after the two-for-one stock split effected October 2000).

Growth was driven primarily by the Web Publishing segment (up 36% to $536.6 millionb, led by Photoshop 6.0) and the ePaper Solutions segment (up 61% to $207.8 million, driven by Acrobat adoption). Cross-media Publishing grew 10% to $390.5 million, while the OEM PostScript and Other segment declined 5% to $131.5 million as monochrome laser printer weakness and HP's PostScript clone eroded royalties. Operating income rose to $408.1 million, and operating margin improved, helped by a 93% gross margin and disciplined cost controls, though sales and marketing expenses grew 22% and R&D grew 22%.

Balance-sheet strength improved meaningfully: cash, cash equivalents, and short-term investments reached $679.9 millionc, up 36%, with cash from operations of $444.6 million. Adobe repurchased $255.5 million of stock during the year and paid modest dividends, and stockholders' equity rose to $752.5 million.

Management guided to at least 25% revenue growth in fiscal 2001, but flagged a U.S.-centered economic slowdown that is already affecting all segments and could make the target harder to reach, and expects OEM PostScript revenue to fall roughly 10% further. Key risks disclosed include dependence on a few distributors (Ingram Micro at 30% and Tech Data at 14% of fiscal 2000 revenue), reliance on a small number of OEM partners, ongoing litigation with Macromedia, a pending securities class action with trial set for July 2001, and equity investment volatility, including a $162.7 milliond fair-value portfolio of private and public holdings that has produced large swings in reported investment gains.

02—Key points

Key Highlights

  1. Revenue grew 25% to $1,266.4 million in fiscal 2000, versus 13% growth in fiscal 1999.
  2. Net income rose to $287.8 million ($1.13 diluted EPS), up from $237.8 million, though fiscal 1999 was boosted by $88.9 million in investment gains versus $14.3 million in fiscal 2000.
  3. Web Publishing (+36% to $536.6 million) and ePaper Solutions (+61% to $207.8 million) drove growth, while OEM PostScript and Other declined 5% to $131.5 million.
  4. Cash, cash equivalents, and short-term investments increased 36% to $679.9 million; operating cash flow was $444.6 million.
  5. Adobe repurchased $255.5 million of treasury stock in fiscal 2000 and effected a two-for-one stock split in October 2000.
  6. Fiscal 2001 targets include at least 25% revenue growth, a 32% operating margin, and a 34% effective tax rate, but management warned that a U.S. economic slowdown could jeopardize the revenue goal.
  7. Customer concentration is high: Ingram Micro (30%) and Tech Data (14%) accounted for 44% of fiscal 2000 revenue.

03—Questions

Frequently Asked Questions

  1. What drove Adobe's revenue growth in fiscal 2000?

    Growth was led by the Web Publishing segment, which rose 36% to $536.6 million on strong Photoshop 5.5 sales and the Photoshop 6.0 release, plus the ePaper Solutions segment, which rose 61% to $207.8 million as Acrobat and PDF gained adoption across industries and governments. Cross-media Publishing grew 10%, helped by Illustrator 9.0.

  2. Why did the OEM PostScript business decline, and what is the outlook?

    The OEM PostScript and Other segment fell 5% to $131.5 million due to lower royalty rates, weakness in the monochrome laser printer market, and the loss of royalties from HP, which uses a clone PostScript implementation. Management expects this segment to decline about 10% further in fiscal 2001.

  3. How strong is Adobe's balance sheet and capital allocation?

    Adobe ended fiscal 2000 with $679.9 million in cash and short-term investments, no debt drawn on its $200 million credit lines, and stockholders' equity of $752.5 million. It generated $444.6 million in operating cash flow and returned capital through $255.5 million in buybacks and about $12 million in dividends.

  4. What are the main risks investors should consider?

    Key risks include heavy dependence on two distributors for application product revenue, reliance on a few OEM partners for licensing income, a slowing U.S. economy, intense competition from Microsoft and Macromedia, a Macromedia patent lawsuit, a securities class action set for trial in July 2001, and volatility from equity investments that can swing reported earnings significantly.

04—Continue

← View all 10-K filings