Adobe: In Crummy Economy, Customers Delay Upgrades
Adobe (ADBE) shares are trading lower this morning after RBC Capital analyst Robert Breza trimmed his estimates and price target on the stock, noting that the upgrade cycle for the recently released Creative Suite 4 has been slowed by the weak economy.
“Our current checks indicate that Adobe’s end markets of enterprises, knowledge workers, designers, OEM partners and developers remain under pressure worldwide,” he writes. “Customers remain reluctant to part with cash and engage in education programs to upgrade to the newly released CS4.” He adds that checks with distribution partners find “a tough business climate” in the company’s fiscal first quarter ending this month. He says that it looks like more customers will skip the new version of Creative Suite and wait for version 5, due in a year or so.