Adobe Systems Inc, the Photoshop maker, projects better-than-expected revenue and profit for the fiscal year 2018 because of growth in its cloud business, sending its shares up 8% in extended trading.
On Wednesday, the company said that it expects revenue of $8.7 billion and profit of about $5.50 per share for 2018.
Analysts were anticipating revenue of $8.68 billion and profit of $5.21 per share.
The transfer to a cloud-based subscription has brought a more predictable revenue stream for Adobe, by selling its software via web-based subscriptions, and not via the sale of packaged-licensed software.
Adobe said that it expects revenue from its digital media unit, which includes the Creative Cloud, to be up by 23% from a year earlier.
The company also said that it anticipates experience cloud bookings, a set of cloud services that is part of its digital marketing unit, to be up by 20% from a year earlier.
Adobe stated that it is on track to achieve its forecast for current-quarter revenue and profit.
The company assumed an adjusted profit of $1.15 per share and a revenue of $1.95 billion for the year’s fourth quarter. Analysts were foreseeing earnings of $1.16 per share and revenue of $1.95 billion, according to reports.
Adobe shares were up by 8.1% at $165.40. Up to Wednesday’s close, the stocks had increased 48.6% since the beginning of 2016.