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Shares of Adobe Inc. moved higher in extended trading today after the design software firm reported earnings that topped expectations and offered a forecast for the next quarter and full year that matched analyst’s targets.

The company reported fourth-quarter earnings before certain costs such as stock compensation of $3.60 per share, coming in ahead of the $3.50-per-share forecast by Wall Street. Revenue for the period rose 10% from a year earlier, to $4.53 billion, matching Wall Street’s forecast exactly. Net income came to $1.18 billion, down slightly from the $1.23 billion Adobe reported in the year-ago quarter.

For the full year, Adobe posted total revenue of $17.61 billion, up 12% from a year earlier, with earnings before certain costs coming to $13.71 per share. Net income for the year came to $4.76 billion.

Adobe Chairman and Chief Executive Shantanu Narayen (pictured) told analysts in a statement that the company drove record revenue and operating income in fiscal 2022. “Our market opportunity, unparalleled innovation, operational rigor and exceptional talent position us well to drive our next decade of growth,” he added.

Breaking down those numbers, Adobe said its Digital Media business, which includes its subscription-based Creative Cloud design software suite, generated $3.3 billion in revenue, growing 8% from a year ago but falling just short of Wall Street’s target of $3.31 billion. The Digital Experience unit, which includes Adobe’s marketing software, added $1.15 billion in revenue, ahead of the $1.14 billion estimate.

Anil Chakravarthy, president of the digital experience business, told analysts on a conference call that the unit had succeeded in “closing numerous transformational deals that span our portfolio of solutions.”

During the quarter, Adobe announced its plans to buy the privately held design software startup Figma Inc. for about $20 billion, in what would be its largest acquisition to date. Figma, founded in 2012, sells a cloud-based, low-code platform for designing user interfaces for websites and applications. Using its platform, multiple designers can edit a user interface at the same time. Figma also enables users to collect feedback from other stakeholders, such as software developers.

Figma’s platform, a direct competitor to some of Adobe’s own design tools, will be incorporated into the Creative Cloud software unit once the acquisition is completed.

David Wadhwani, president of Adobe’s digital media business, said the regulatory process regarding the acquisition is proceeding as expected. The deal is being reviewed by the U.S. Justice Department and the U.K.’s Competition and Markets Authority, and is likely to close sometime in 2023, he added.

Looking to the first quarter of its fiscal 2023 year, Adobe said it’s eyeing earnings of between $3.65 and $3.70 per share, with revenue expected to fall between $4.6 billion and $4.64 billion. That’s more or less in line with Wall Street’s forecast of $3.64 per share in earnings and $4.64 billion in revenue.

Adobe’s stock, which had fallen by just over 3% in the regular trading session when many stocks fell sharply, rose more than 4% on the back of the strong results. The stock is still down 42% for the year, though, compared with the S&P 500 Index that has declined by 18% over the same time frame.

Photo: Fortune Live Media/Flickr

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