Adobe Keeps Building

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Adobe Systems (Nasdaq: ADBE), best known for its PhotoShop, Acrobat, and Illustrator software suites, today pre-announced limited financial results for the fiscal fourth quarter ending November 28. Adobe is pointing investors toward revenue of between $330 and $350 million, and net income of $0.30 to $0.32 per share.

The low end of the range represents a 6% year-over-year increase in revenues and a 50% increase in EPS. For the full year, the company is pointing investors toward revenues of $1.425 billion. All the major geographic markets are, Adobe says, "on track."

Based on a projected 30% operating margin, investors can guess at a net income figure by applying a rough 30% tax rate to its pretax net income. That gets us to net income of approximately $300 million, up considerably from last year's $191 million.

It's hard to imagine that shares of a gold-standard business software company like Adobe sold for as little as $22 within the last 12 months -- even less if you go slightly further back. Numbers like these certainly explain the stock's rapid recovery. As noted by Rick Aristotle Munarriz covering the company's Q3 results in September, strong profit margins and product penetration are driving growth.

What lies ahead for Adobe will probably be hinted at in the company's next few earnings reports, with the company shipping Creative Suite -- which includes versions of Photoshop, Illustrator, InDesign, and GoLive -- today. Early channel orders, according to the company, are "strong."

Updated stand-alone versions of all four products are coming soon. Professionals using Adobe products drive growth by their enthusiasm for new products, but also the features and usability each new update brings. The company's reputation (not to mention its ability to generate cash flow) is fantastic, which is why investors can be reassured even when earnings "miss" slightly -- as they sometimes do.

For further hints, check out today's webcast of Adobe's fall analyst meeting, which begins at 1 p.m. ET. (It will be archived if you can't watch live.) Q4 results are set for a December 11 after-hours release.

Dave Marino-Nachison can be reached at dmarnach@fool.com.