An update on Adobe Marketing Cloud

My January post, “The State of the Digital Analytics in 2015,” is far and away my most-read this year. In my research for that piece, I did a fair amount of financial analysis tracing Adobe’s steady rise as the juggernaut of “MarTech” over the last five years. I hadn’t updated my numbers in a couple of quarters, so I was interested to see how my predictions had panned out. Turns out – pretty well!

Click for a link to the full spreadsheet.

You can see the full breakdown here, along with my predictions for Adobe’s Q4 2015 results.

I predicted last year that Adobe would do $387M of Digital Marketing revenue in Q4 2014, and they wound up doing $374, so I was about 3.5% off. I’ll take it. My point from earlier stands – Adobe is becoming the textbook example of how a very large company can pivot to an entirely new market (marketing technology) and delivery model (cloud-based), simultaneously. How many other companies have had the courage to try that? How many have tried, but failed? Adobe has managed to not only do those things, while retaining a ton of acquired talent (from Omniture, Day Software, Demdex, Neolane, and more), but also added a whole new business line to the company, now contributing a third of total revenue.

Creative Cloud is also growing. I seem to run into a lot of creative professionals (mostly SV-based) who dismiss Adobe in this field, saying that they’re being eclipsed by other free, cloud-based alternatives. I’m pretty sure those folks are dead wrong. The results speak for themselves – Creative Cloud is adding new subscribers and building its business, and Adobe seems squarely committed to that business in the future. But that’s an industry I know very little about, so take that with a grain of salt.

“Blair,” I hear you asking, “why do you care so much about breaking down Adobe’s financials?”

Fair question. Partly, I think this stuff is interesting – I once considered getting an accounting degree (I’m a lot of fun at parties). But for my purposes now, clarifying the details of Adobe Marketing Cloud’s business is helping me build a model for another research project I’ve had on the back burner. More on that to come.



So, what do you think ?