Adobe setting itself up for a buyout by rich rival like Apple?

“Adobe Systems can Photoshop its second-quarter results all it wants. I’m still going to be disappointed by these numbers, even if you gloss over a few of the biggest blemishes,” Anders Bylund writes for The Motley Fool.

“The maker of software for creative professionals reported a 19% year-over-year revenue gain… But for Adobe, it’s a letdown. The annual sales growth in the last three quarters was 41%, 34%, and 37%, in that order, so a mere 19% is a very weak trend,” Bylund writes.

“Color me unimpressed by Adobe. Is the company lowballing us to set itself up for a buyout by some rich rival in digital media, like Apple or Microsoft? Nah, too much conspiracy theory for my tastes,” Bylund writes. “All the same, I wouldn’t be surprised to see this corner of the market consolidate a bit — starting with Adobe.”

Full article here.

We cannot imagine that the FTC would ever approve of Microsoft buying Adobe.

MacDailyNews Note: Adobe’s market value is currently $22.8 billion. Apple’s is $151.1 billion. Apple is also debt-free and has approximately $20 billion in cash on hand currently.

61 Comments

  1. Part of their disappointing sales may be due to the bloatware they seem to be fond of generating these days. Some new features in the CS3 suite are nice, but hardly worth the upgrade price in most cases. They should take a page from Apple’s Snow Leopard book and concentrate on unifying and sharpening their existing apps instead of cramming more and more “features” in places where they’re not really necessary.

  2. Ok, now we’re on the subject.
    The FTFF campaign needs to hit Apple hard.
    Snow Leopard is getting a good under-the-hood tweak, but if we put the pressure on them Apple might just decide to finally fix the flippin Finder once and for all.

  3. Adobe dragged its feet for far too long with CS2 and Intel Macs – to the extent that if you ask any professional, they’ll tell you the two, when combined, suck! EPS files [surely one of the worst and now oldest file formats in digital media], have a habit of crashing any Intel Mac when trying to print or make pdfs.

    It’s got so bad that my studio routinely changes eps files to either ‘.ai’ or ‘.tif’ files, before trying to print, or uses one of our CS3 equipped machines.

    Buy Adobe, create a new division [think Claris, or FileMakerPro], move InDesign, Illustrator, Photoshop and Acrobat into this semi-autonomous division. Dreamweaver, Flash, Fireworks and the rest can then be sold off. Reduce the bloated mess that Acrobat has become and move it away from the Windows-centric world it currently lives in. Then licence everything.

  4. Adobe has old legacy apps (except maybe the Macromedia ones) the current managent have used to maximize profit (by not investing in development).
    Right now there is a huge opportunity to introduce a set of modern apps on the market. A company like Apple (or some other serious SW company, maybe even MS) could kick some Adobe butt if they set their mind to it. Why buy when you could kill the competition?

  5. “Adobe Systems can Photoshop its second-quarter results all it wants.”

    Only one thing is sure. The Fool can expect a letter from Adobe admonishing them for using their trademark as a verb.

  6. Apple is focused on growth industries (digital downloads of movies, music) and consumer goods (iPods, iPhones) to consume the movies and music. Content creation in Adobe’s portfolio had it’s heyday years ago when desktop publishing and the internet took off.

    The biggest potential growth area in Adobe’s portfolio is video. Apple already has Final Cut Studio, the hardware to match and they’re up against Avid. Yes, Acrobat is growing very rapidly but does the growth of Acrobat justify buying Adobe? I personally don’t think so.

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