Adobe Inc (NASDAQ: ADBE) stock lost over 3% in the pre-market session of September 18th, 2019 (Source: Google finance) as the firm gave fourth quarter forecasts less than estimates. ADBE said that bookings in its newly acquired marketing software unit are growing slower than expected. The company reported net income of $792.8 million in the third quarter from $666.3 million, a year earlier.
Meanwhile, ADBE’s vision is that mobile devices and tablets to be used for creation apart from consumption. Adobe Lightroom, the complete system for photo editing, has posted growth on mobile devices and the third quarter monthly active users are growing 130% year-over-year. In Q3, new Adobe IDs created from Adobe mobile apps grew more than 40% year-over-year, which reflects that mobile continues to be a healthy on-ramp for subscriptions. In Q3 the company announced Adobe Fresco, a groundbreaking drawing and painting app, which will be available first on iPad later this fall.
ADBE in the third quarter of FY 19 has reported the adjusted earnings per share of $2.05, while adjusted revenue growth of 24 percent to $2.83 billion in the third quarter of FY 19. The revenue from its digital media unit, home to image-editing software Photoshop, grew 22% to $1.96 billion in the third quarter 2019, but that was the slowest year-on-year increase in at least 10 quarters. The addition of $386 million net new Digital Media ARR during the third quarter expanded the total to $7.86 billion. Within Digital Media, the company achieved another strong quarter with the Creative business. Creative revenue rose 22% year-over-year in the third quarter and the company had increased Creative ARR by $314 million. ADBE now expect to grow its total Digital Experience subscription bookings in FY19 by more than 20% year-over-year. ADBE has posted Document Cloud revenue of $307 million, which is 24% year-over-year rise, and has added a record $72 million of net new Document Cloud ARR during the third quarter.
For the fourth quarter, Adobe expects the adjusted earnings of $2.25 a share on sales of $2.97 billion. Analysts on average were anticipating adjusted earnings of $2.30 a share on revenue of $3.02 billion, according to FactSet.