By Tess Stynes
Adobe Systems Inc. agreed to acquire privately-held
stock-photography website company Fotolia for roughly $800 million
and reported, earnings excluding one-time items, that topped
expectations as well as strong growth in Creative Cloud
subscriptions for the quarter ended November.
Shares rose 7.1% to $74.69 in recent after-hours trading.
Fotolia company is owned by Kohlberg Kravis Roberts & Co.
LP, TA Associates and management. When the deal closes, expected in
the second half of Adobe's recently started business year, Fotolia
Chief Executive Oleg Tscheltzoff, will continue to lead the Fotolia
team as part of Adobe's digital media business.
The maker of Photoshop and Illustrator design software has been
transitioning to cloud services, which generate monthly
subscription revenue, and away from packaged software, which has
been based on large upfront payments.
Adobe in September said it acquired privately held Aviary, a
deal that gives it a developer of software development kits, or
mobile SDKs, used to create mobile apps. Adobe expects that deal
will step up its strategy to make its Creative Cloud a platform for
third-party apps.
The company added 644,000 new Creative Cloud subscriptions in
the latest quarter. Adobe had subscriber additions to surpass the
502,000 subscribers added in the previous quarter.
For the period ended Nov. 28, Adobe reported a profit of $73.3
million, or 14 cents a share, up from $65.3 million, or 13 cents a
share, a year earlier. Excluding stock-based compensation,
restructuring charges and other items, earnings rose to 36 cents
from 32 cents. Revenue increased 3% to $1.073 billion.
Adobe expected per-share profit of 26 cents to 32 cents and
revenue of $1.025 billion to $1.075 billion.
Write to Tess Stynes at tess.stynes@wsj.com
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