Adobe Systems Inc. topped analysts’ profit and revenue estimates for the seventh straight quarter as its subscriptions for its Creative Cloud suite software and average revenue per user have surged.

Adobe, known for its image-editing software Photoshop, rose 3.5 percent to $226.5 in after-hours trading on Thursday.

Revenue jumped 24 percent to $2.08 billion and profit, excluding some costs, reached $1.55 a share in the quarter that ended March 2, according to the company’s statement. Analysts expected $2.05 billion in sales and earnings of $1.44 a share.

Adobe plans to raise prices on its popular software like Photoshop next month. Analysts said that helped subscription sales as customers looked to lock in lower rates.

The company said revenue was boosted by subscribers coming off discounts and users buying multiple, not just single, applications.

Creative Cloud software


Adobe has been getting a lift from its switch to a web-based subscription service for its flagship Creative Cloud products, which it launched in the second quarter of 2012.

“Clearly, a lot of the new customer acquisition is a result of the Single App adoption,” Chief Executive Shantanu Narayen said on a post-earnings call with analysts, adding the company has succeeded in encouraging customers to use the entire state.

This has also helped improve average revenue per user, Narayen said.

Revenue from Adobe’s digital media business that includes Creative Cloud jumped about 28 percent to $1.46 billion, ahead of analysts’ average estimate of $1.43 billion.

Adobe started telling to its customers and its channel about increased prices for Adobe’s Creative Cloud Cloud services earlier this month, Adobe CFO Mark Garrett said.

While they did take effect in the fiscal second quarter, they won’t have a material impact on annual recurring revenue, Garrett said.

Adobe, which has long had a dominant market share in creative software, has competed with Salesforce and Oracle products in marketing.


“We welcome competition, but as the clear leader we’re going to assume that people are going to follow us,” Narayen said.

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