Adobe stock slides despite record revenue and flurry of AI launches

Adobe Inc (NASDAQ: ADBE) is trending down in extended hours even though it reported record revenue for its third financial quarter.

Why is Adobe stock down in after-hours trading?

Shareholders are unimpressed primarily because they expected more in terms of future guidance.

Adobe is calling for its revenue to fall between $4.97 billion and $5.02 billion in the current quarter on $4.10 to $4.15 of adjusted per-share earnings. Experts, in comparison, were at $5.0 billion and $4.06 a share.

The multinational made a series of artificial intelligence-focused announcements only a day ahead of its earnings release. According to its CEO Shantanu Narayen:

We’re unleashing a new era of AI-enhanced creativity. Recent launches of Firefly, Express, Creative Cloud, and GenStudio make Adobe magic available to millions of users.

Shares of Adobe Inc are up more than 60% for the year at writing.

Notable figures in Adobe Q3 earnings release

• Earned $1.4 billion versus the year-ago $1.14 billion
• Per-share earnings also climbed from $2.42 to $3.05
• Adjusted EPS printed at $4.09 as per the press release
• Revenue jumped 10% year-over-year to $4.89 billion
• Consensus was $3.98 a share on $4.87 billion revenue

The computer software company saw its Digital Experience and Digital Media revenues climb 10% and 11%, respectively. Dan Durn – the Executive Vice President of Adobe said in a press release today:

Adobe delivered world-class margins and earnings while making significant investments in our tech platforms. Our innovation engine, global reach, and strong operational rigor position us to capture the massive opportunities ahead.

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