The end of earnings season is always a good time to take a step back and see who shined (and who didn’t). Let’s take a look at how design software stocks fared in the fourth quarter, starting with Adobe ( NASDAQ:ADBE ) .
The demand for rich, interactive 2D, 3D, VR and AR experiences is growing, and while the ubiquitous metaverse is still more of a buzzword than a reality, the real demand is for the tools to create those experiences, whether games, 3D tours or interactive movies.
8 design software stocks we follow reported mixed Q4; on average, revenues beat analysts’ consensus estimates by 1.9%. while revenue guidance for the next quarter was 5.8% below consensus. Equities – especially those trading at higher multiples – had a strong finish to 2023, but 2024 saw periods of volatility. Mixed signals on inflation led to uncertainty about rate cuts, and design software stocks had a rough time, with share prices down an average of 5.5% from previous earnings results.
Adobe (NASDAQ:ADBE)
One of Silicon Valley’s best-known software companies, Adobe (NASDAQ:ADBE) is a leading software-as-a-service provider in the digital design and document management space.
Adobe reported revenue of $5.18 billion, up 11.3% year over year, in line with analyst expectations. It was a mixed quarter for the company, with revenue exceeding analysts’ expectations. Its net new digital media ARR of $432 million topped estimates of $415 million, allowing the company to beat Wall Street’s revenue and earnings per share projections. On the other hand, its revenue guidance for the next quarter missed analysts’ expectations as its new digital media net ARR guidance of $440 million came in below analysts’ forecasts of $468 million.
“Adobe delivered record revenue in the first quarter showing strong momentum in Creative Cloud, Document Cloud and Experience Cloud,” said Shantanu Narayen, chairman and chief executive officer of Adobe.
The stock is down 15.1% since the results and is currently trading at $485.51.
Is now the time to buy Adobe? Access our full earnings performance analysis here, it’s free.
Top Q4: ANSYS (NASDAQ:ANSS)
Used to help design the Mars Rover, Ansys (NASDAQ:ANSS) offers a software-as-a-service platform that enables simulation for engineering and design.
ANSYS reported revenue of $805.1 million, up 15.9% year over year, beating analysts’ expectations by 1.2%. It was a very good quarter for the company, with revenue and earnings per share exceeding analysts’ estimates.
The stock is up 1% since the results and is currently trading at $332.01.
Is now the time to buy ANSYS? Access our full earnings performance analysis here, it’s free.
Unity (NYSE:U)
Unity (NYSE:U) was started as a game studio by three friends in an apartment in Copenhagen, a software-as-a-service platform that facilitates the development and monetization of new games and other visual digital experiences.
Unity reported revenue of $609.3 million, up 35.1% year-over-year, beating analysts’ expectations by 4.1%. It was a weak quarter for the company, with full-year revenue guidance falling short of analysts’ expectations and management predicting a slowdown in growth.
Unity posted the fastest revenue growth but had the weakest updated full-year guidance of the group. The stock is up 2.5% since the results and is currently trading at $25.87.
Read our full breakdown of Unity’s results here.
PTC (NASDAQ:PTC)
Used to design the Airbus A380 and Boeing 787 Dreamliner commercial aircraft, PTC’s (NASDAQ:PTC) software-as-a-service platform helps engineers and designers create and test products before production.
PTC reported revenue of $550.2 million, up 18.1% year-over-year, beating analysts’ expectations by 2.3%. It was a decent quarter for the company, solidly beating analysts’ ARR (annual recurring revenue) estimates, but full-year revenue guidance fell short of analyst expectations.
The stock is up 0.5% since the results and is currently trading at $181.56.
Read our full, actionable PTC report here, it’s free.
Procore Technologies (NYSE:PCOR)
Used to manage the multi-year expansion of the Panama Canal that began in 2007, Procore Technologies (NYSE:PCOR) offers a software-as-a-service project, finance and quality management platform for the construction industry.
Procore Technologies reported revenue of $260 million, up 28.7% year over year, beating analyst expectations by 4.7%. It was a strong quarter for the company, with revenue and earnings per share exceeding expectations.
Procore Technologies posted the biggest beat on analyst estimates and the biggest increase in full-year guidance among peers. The company added 300 customers to reach a total of 16,367. The stock is up 1.3% since the results and is currently trading at $75.52.
Read our full, actionable report on Procore Technologies here, it’s free.
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