Adobe Systems Inc. (ADBE)’s shares fell in late trading after its profit forecast missed some estimates, as the company steps up spending on sales and marketing and adopts a subscription-pricing approach.

Excluding some costs, profit will be 57 cents to 61 cents a share in the second quarter, San Jose, California-based Adobe said yesterday in a statement. The midpoint of that range — 59 cents — missed the 60 cents predicted by analysts, according to data compiled by Bloomberg. Sales will be $1.09 billion to $1.14 billion, compared with a $1.11 billion average estimate.

Adobe, the largest maker of graphic design software, is boosting its marketing budget as it prepares to release Creative Suite 6 around April. The product line, which includes Photoshop and Dreamweaver, will add cloud-computing features, letting users rent the software over the Web for a monthly subscription fee. While that approach is unproven ground for Adobe, it could eventually make the company’s revenue more predictable.

“The main story for 2012 is how they transition to this subscription pricing,” said Josh Olson, an analyst at Edward Jones & Co. in Des Peres, Missouri, who has a hold rating on the shares. “It’s been a stock that’s moved a lot with the product cycles. Long term, they need to get more recurring revenue.”

Adobe shares declined as much as 6.2 percent to $32.36 in extended trading yesterday following the report. The stock had climbed 22 percent this year before today.

Timing of Release
Investors also are concerned that Creative Suite 6 won’t arrive in April, the month Adobe typically releases new versions of the software, Olson said. He expects it in May, which may crimp sales in the current quarter.

Adobe Chief Financial Officer Mark Garrett declined to say when the software would be released, though he did indicate it might be later than the typical Creative Suite debut. The software will include the first major update to Adobe’s popular Photoshop software in two years. The company also is synchronizing online and desktop versions of the suite, making the development process longer than usual, he said.

Sales of Adobe’s digital media products, which include Creative Suite, declined 4 percent to $730.3 million in the first quarter — a sign customers are holding off on purchases until the new version arrives, Garrett said.

“The more we went through the quarter and talked about CS6, we saw people waiting,” he said.

Sales and marketing expenses, meanwhile, climbed 9.4 percent in the first quarter to almost $359 million.

Pricing Change
Only some customers will adopt the subscription pricing. Still, it will be a big change for Adobe, which is accustomed to large upfront payments, Olson said. In the short term, that could mean the new software brings in less revenue.

“What would have been a $1,400 upgrade is a now a $50 or $60 a month subscription,” he said. “That’s going to mute revenue growth.”

Chief Executive Officer Shantanu Narayen has been counting on the new Creative Suite to cement Adobe’s comeback, following a slump characterized by slow sales, job cuts and a feud with Apple Inc. The company is relying more heavily on the HTML5 programming language, rather than its Flash software, after Apple refused to include Flash in its mobile devices.

First-quarter net income declined to $185.2 million, or 37 cents a share, from $234.6 million, or 46 cents, a year earlier. Sales rose 1.7 percent to $1.05 billion in the period, which ended March 2.

Adobe said in November it would eliminate 750 jobs and shift investment to programs for digital publishing and Web advertising. The company plans to discuss a separate set of software programs for online advertising at its Digital Marketing Summit in Salt Lake City later this week.

Source:http://www.businessweek.com/news/2012-03-19/adobe-s-profit-forecast-misses-estimates-amid-software-upgrade

Adobe Systems on Monday launched its new LeanPrint software, which it claims can cut a typical office’s paper and toner consumption — along with its printing costs — by approximately 40 percent.

The software reformats documents so that they print more efficiently, using less paper and toner, according to the company. It lays out text in newspaper-style columns to make better use of space, removes display ads from printed Web pages, reformats Excel charts to keep graphs intact — when possible — and converts color charts and graphs into readable black-and-white patterns, Adobe says (see LeanPrint datasheet PDF). Before documents are printed, the program shows users a preview of how they will appear.

LeanPrint also keeps track of the amount of money users — and organizations — have saved from printing more efficiently, and includes tools that enable managers to enforce rules such as double-sided printing, if desired.

The company has partnered with Toshiba America Business Solutions to develop and distribute LeanPrint. The software costs $99 per PC user or $36 per user per year through a subscription, and a 30-day free trial of the software is now available via Toshiba. Adobe also offers a set of plugins for Microsoft Excel and Word, Adobe Acrobat and Reader, Internet Explorer and Firefox.

“LeanPrint promises to revolutionize the way we all print at home and in the office by saving time, money and ultimately the environment,” Bill Melo, vice president of marketing, services and solutions at Toshiba America Business Solutions, said in a statement.

The news marks the latest attempt to reduce businesses’ paper consumption. It’s a noble goal: Paper accounts for the use of more than 40 percent of logged trees, and businesses contribute significantly. Americans discard 4 million tons of office paper every year — enough to build a 12-foot-high wall of paper from New York to California, according to an American Forest and Paper Association estimate in 2004. It would take roughly 96 million trees to make that much (nonrecycled) office paper.

Trees aren’t the only resourced used to make paper, either. Paper manufacturing is the largest industrial user of water per pound of finished product, according to the American Forest and Paper Association. Environment Canada estimates that it takes 324 liters of water to make 1 kilogram of paper. That means that it would take approximately 310.59 billion gallons of water to make the annual 4 million tons of U.S. office paper from scratch.

And, of course, reducing the amount of paper and toner that a business uses also can slash its costs. An All Associates white paper in 2003 estimated that Fortune 1000 companies spent a whopping $217 billion on office documents in 2002.

Aside from Adobe, other software companies also have developed programs that can reduce printing costs. GreenPrint Technologies’ software, for example, makes it easier for users to cut out unwanted text, images and pages from documents before they’re printed. Marks & Spencer uses GreenPrint’s software in its UK headquarters. And the World Wildlife Foundation in 2010 released a new file format that simply doesn’t print, to prevent people from printing certain emails.

Source:http://www.greenbiz.com/blog/2012/03/05/adobe-launches-new-software-cut-printing-40