ADOBE INC. Quarterly Report for Q2 Ended Mar 5, 2010

Summary

Adobe Systems Incorporated reported its first quarter fiscal 2010 results, showing a robust increase in total revenue driven significantly by the recent acquisition of Omniture. While product revenue saw a slight decrease year-over-year, the substantial growth in subscription revenue, largely attributed to Omniture, more than compensated, leading to an overall revenue increase of 9%. The company's financial position remains strong, with a significant increase in cash and cash equivalents and short-term investments. Operating expenses saw an increase, largely due to the integration of Omniture and increased investments in R&D and Sales & Marketing, reflecting a strategic focus on growth and product development.

Key Highlights

• 1Total revenue increased by 9% year-over-year to $858.7 million, primarily driven by the acquisition of Omniture.
• 2Subscription revenue saw a significant surge, increasing by over 675% to $95.5 million, largely due to Omniture's contribution.
• 3Cash and cash equivalents, along with short-term investments, increased substantially to $2.67 billion, indicating strong liquidity.
• 4Research and Development expenses increased by 16% and Sales & Marketing expenses by 19%, reflecting continued investment in growth and product innovation.
• 5The company issued $1.5 billion in senior notes to fund general corporate purposes and repay existing debt.
• 6Adobe completed the integration of Omniture, creating a new reportable segment and integrating its operations.
• 7Net income decreased to $127.15 million from $156.44 million in the prior year's comparable period, impacted by increased operating expenses and interest expense.

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