Adobe is scheduled to announce its second-quarter earnings report for the 2024 fiscal year this Thursday. Analysts predict that the company will show an increase in revenue and net income compared to the same period last year. Investors will be paying close attention to Adobe’s Digital Media business performance and updates on its artificial intelligence monetization plan.
According to estimates, Adobe’s revenue for the second quarter of fiscal 2024 is expected to reach $5.29 billion, up from the previous quarter and the year-ago period. Net income is projected to be $1.51 billion, an increase from $1.3 billion in the same quarter of 2023. Additionally, diluted earnings per share are estimated to be $3.34, compared to $2.82 a year earlier.
In the first quarter of fiscal 2024, Adobe’s Digital Media segment generated $3.82 billion in revenue, showing a 12% year-over-year growth. Analysts anticipate that the segment will report $3.89 billion in revenue for the second quarter, marking a 10.8% growth from the previous year.
Recently, Adobe introduced an AI assistant subscription add-on to its offerings, aiming to improve monetization of artificial intelligence and enhance its competitiveness against other tech giants. However, Adobe’s stock has faced pressure due to competitive concerns and concerns about AI monetization in the short term.
Deutsche Bank analysts mentioned that while there are challenges in monetizing Generative AI, which is still evolving, they expect investors to have a more positive outlook on Adobe’s overall AI strategy. They also anticipate that Adobe will provide further updates on its AI monetization plans during the earnings call.
Adobe’s shares have experienced a decline of more than 20% since the beginning of 2024, closing at $462.69 on Tuesday. As Adobe prepares to release its quarterly results, market watchers are keen to see how the company’s Digital Media business has performed and what insights will be shared regarding its AI monetization strategy.