New CC Offerings to Debut Tomorrow at NYC Customer Event
Adobe netted 464,000 new paying subscribers to its Creative Cloud service in the second fiscal quarter of 2014, with total paid subscriptions climbing to 2,308,000 by May 30. That's well in keeping with the company's expectations — back in March, it said it was expecting another 400,000 subscribers to sign on in the quarter — and the company has increased its long-standing prediction from 3 million to 3.3 million Creative Cloud subscribers by the end of the fiscal year in November.
During a conference call with investors and analysts today, Adobe President and CEO Shantanu Narayen said that new desktop applications, mobile apps, and other services will be announced tomorrow as part of an expansion of Creative Cloud aimed at "hobbyists and consumers," which he described as a significant opportunity. "This is our biggest update since CS6," he said, noting that the products will be announced at an Adobe customer event in New York City that will be webcast on Adobe.com at 1 p.m. tomorrow.
Source: adobe.com [PDF]
The company's push to sign up subscribers has been controversial in some quarters but largely successful, with subscriptions now accounting for a majority of the company's revenue. Adobe said today that 53 percent of its revenue in the quarter was "recurring revenue" from subscription plans for Creative Cloud as well as from Adobe's Marketing Cloud offering.
Adobe's overall revenue in the quarter was $1.07 billion, up slightly from a reported $1.01 billion in the same quarter last year, and revenue from digital media products grew to $691.6 million from $670 million in the year-ago period. EVP and CFO Mark Garrett acknowledged that a number of Adobe customers hurried to add seats of CS6 during the second quarter, the last period in which they were widely available, but said their allegiance to perpetual licensing is expected to be temporary. "We believe these customers will migrate to Creative Cloud over time," he said.
