Adobe to cut 750 jobs, trims 4Q profit outlook
Wednesday, November 9, 2011
SAN JOSE, Calif. (AP) — Software maker Adobe Systems Inc. said Tuesday that it is laying off 750 workers, or 7 percent of its workforce, as it moves to focus on products that help people create digital content and then market it on multiple devices and platforms.
The company also slashed its earnings guidance for the quarter through Dec. 2 to account for a restructuring charge it expects to book in the quarter of $73 million to $78 million, mainly for severance payments.
Adobe now expects net income of 30 cents to 38 cents per share in the three months to Dec. 2. Earlier, it had forecast earnings of 41 cents to 50 cents per share.
Its adjusted earnings forecast remained 57 cents to 64 cents, in line with the average forecast of analysts polled by FactSet for adjusted earnings of 60 cents per share.
It left its quarterly revenue guidance unchanged at $1.075 billion to $1.125 billion. Analysts are expecting $1.09 billion.
Adobe said it hopes to attract customers to a new subscription offering while cutting back on investment in some enterprise-solution product lines.
The changes will cut 4 to 5 percentage points off of expected revenue for fiscal 2012, it said. Revenue growth for fiscal 2012 is now seen rising 4 percent to 6 percent from fiscal 2011. Analysts had been looking for about 9 percent revenue growth.
The company, which is based in San Jose, said it would explain its plans further in a meeting with analysts in New York on Wednesday.
Its shares fell $2.71, or 8.9 percent, to $27.71 in after-hours trading following its announcement. They closed up 50 cents, or 1.7 percent, at $30.42 in the regular session.