Image source: Adobe.

What: Shares of creative-software provider Adobe Systems (NASDAQ:ADBE) rose 10.2% in March, according to data provided by S&P Global Market Intelligence. The company reported its fiscal first-quarter results on March 17, beating analyst estimates on all fronts and providing strong guidance, driving the stock price higher.

So what: Adobe reported quarterly revenue of $1.38 billion, up 25% year over year and about $40 higher than the average analyst estimate. Annualized recurring revenue from the digital media segment rose to $3.13 billion, driven by continued strong adoption of the company's Creative Cloud offering. Marketing Cloud revenue rose 21% year over year to $377 million.

Adobe reported non-GAAP net income of $0.66 per share, up from $0.44 during the prior-year period, and $0.05 higher than analysts were expecting. On a GAAP basis, Adobe reported $0.50 in per-share earnings, up from $0.17. Higher revenue was the main driver of earnings growth during the quarter.

Adobe expects second-quarter revenue between $1.365 billion and $1.415 billion, with non-GAAP EPS in a range of $0.64 to $0.70. For fiscal 2016, the company expects total revenue of $5.8 billion, with digital media revenue growing by 20%, and with digital media annual recurring revenue exiting the year at $4.0 billion. Non-GAAP EPS of $2.80 is expect, with GAAP EPS of $2.00.

Now what: Adobe's transition to a cloud company has been a dramatic success, with the push to subscriptions making its creative software more affordable and accessible. The company expects its rapid growth to continue, and it's seeing strong adoption of its Creative Cloud product. The stock has been on a tear over the past five years, gaining about 230% since the start of 2012.

ADBE Chart

ADBE data by YCharts

While strong results and guidance pushed the stock higher in March, Adobe's valuation has reached levels that require rapid growth to continue for quite some time. The stock now trades for around 34 times guidance for 2016 non-GAAP earnings, and 47 times guidance for 2016 GAAP earnings. At the moment, though, investors appear willing to pay up for quality, and Adobe stock continues to grind higher despite its lofty valuation.