Adobe Income Q2 2019

Adobe shares rose more than 4% after hours Tuesday after the company announced better than expected second-quarter earnings in 2019 fiscal year, ending May 31, and lighter than expected guidance. 19659002] Here are the key figures:

• Earnings: $ 1.83 per share, except some items, against $ 1.78 per share as expected by analysts, according to Refinitiv.
• Revenue: $ 2.74 billion, vs. $ 2.71[ads1] billion as expected by analysts, according to Refinitiv.

According to a statement, Adobe's revenue increased by 25% year on year in the quarter.

Adobe's largest business segment, Digital Media, which includes Creative Cloud and Document Cloud products, produced $ 1.89 billion in revenue, an increase of 22% and over 1.86 billion consensus estimates among analysts asked by FactSet. The Digital Experience segment, which includes Magento and Marketo, had sales of $ 783.5 million, over the FactSet consensus estimate of $ 777.2 million. The publishing segment contributed $ 70.6 million in revenue, above the $ 66.1 million estimate.

In the quarter, Adobe reported $ 7.47 billion in annual revenues for the Digital Media business. That's over the FactSet consensus of $ 7.44 billion.

"With digital media ARR growth coming down from 30% in the last couple of quarters, investors have begun to question the long-term growth potential of the segment," said Stifel analysts led by Tom Roderick in a note distributed to customers on Sunday. "While the potential for seat conversion is still international, we see existing account penetration and new use cases as short-term primary and ARR growth drivers."

Analysts suggested that more price increases could provide more growth.

In the fiscal second quarter, Adobe launched a new business from Amazon, Adobe CEO Shantanu Narayen told a Tuesday conference with analysts.

Adobe reported that for the third quarter, it expects $ 1.95 in earnings per share, excluding certain commodities, of $ 2.80 billion in revenue. Analysts asked by Refinitiv had left $ 2.05 in earnings per share, except for certain items, and $ 2.83 billion in revenue for that period.

"FY 2019 is expected to be another record year," Narayen said. "We expect the first half to continue in the second half."

Adobe's stock has increased 22% so far in 2019.

WATCH: Adobe CEO: We are "optimistic" about our prospects in the wake of rates