Adobe is Making its Products More Accessible

The Digital Media segment is the main component of ADBE revenue (73%), think creative cloud and document cloud  products like Photoshop, Illustrator, Acrobat, Reader, etc. LikeFolio data shows Digital Media mentions increased +16% YoY. This is a slow-down in pace from rapid adoption a year ago, but still impressive to see YoY improvement.

One of Adobe's strategies for future growth (aside from adding new customers) is expanding mobile use cases. For example, they've introduced "liquid mode" that formats PDFs for mobile viewing, and also added advanced image editing (Photoshop Express/Camera, Adobe Fresco) for the social media gurus. These digital usage mentions are a growing portion of total mentions, highlighting why this is relevant moving forward.

Adobe also has some insulation due to it's subscription business model. Adobe considers Annualized Recurring Revenue (ARR) to be its key performance metric. Total Digital Media ARR grew to $10.18 billion at the end of fiscal 2020, up from $8.33 billion at the end of fiscal 2019 (+22%). Noted drivers include the shift to remote work, and the transition of more document-based products to subscription models. We'll be listening for signs of retention and user growth when Adobe reports Tuesday (March 23) after the bell.