Creative design software firm Adobe Inc. beat expectations as it posted its third-quarter financial results today, showing strong revenue growth and guidance for the next three months.

The company reported a profit before certain costs such as stock compensation of $3.11 per share on record quarterly revenue of $3.94 billion, up 22% from one year ago. Wall Street had been looking for a profit of $3.01 per share on revenue of $3.89 billion.

Adobe President and Chief Executive Shantanu Narayen (pictured) said the company delivered on an “outstanding quarter” as it continues to transform storytelling, learning and the way people conduct business. Adobe is probably best known for its iconic Photoshop image editing tools, but it actually has three distinct cloud software businesses.

The largest of those is Creative Cloud, which includes Photoshop and other tools for creative professionals. That segment pulled in revenue of $2.37 billion in the quarter, up 21% from the year before.

The other segments include Adobe’s Experience Cloud, which sells marketing software and services. Revenue for the segment rose 23% to $985 million. Lastly, Adobe’s Document Cloud that bundles Acrobat with its e-signature tools added an additional $493 million, up 31% from a year ago.

Ashley Gaare, president at digital advisory firm SoftwareONE, said Adobe’s strong results are thanks to the increasing number of firms that are reconsidering their return-to-office plans in light of the Delta variant of COVID-19, which has reinforced the idea that they need to focus on more efficient, digital workplaces.

“Adobe is benefiting from this increased software spend and I’d anticipate a continued demand for it’s subscription-based solutions that deliver increased productivity such as Adobe Document Cloud, Adobe Sign and Adobe Creative Suite as we move into Q4 and 2022,” she said. “Adobe’s subscription-based solutions have been instrumental in helping organizations work to harmonize remote and in-office environments.”

Despite the strong performance across all three segments, Adobe’s stock fell more than 3% in extended trading. Its shares had previously made gains of more than 40% in the last six months.

Adobe made a couple of major business moves during the quarter. Just last week, it said it will add payment services to its e-commerce platform to help its merchants accept credit cards and other ways of paying. Adobe said it’s partnering with PayPal Holdings Inc. to process a variety of payment types, including credit cards, debit cards and PayPal’s own offerings.

In August, Adobe swooped to acquire the video review and collaboration platform provider Frame.io Inc. for a reported $1.275 billion in cash. The plan is to integrate Frame.io’s capabilities with the Creative Cloud software.

Constellation Research Inc. analyst Holger Mueller told SiliconANGLE that revenue growth of 20% or more signals that things are going extremely well for Adobe. The company isn’t resting on its laurels either, he added, noting that it has been aggressively building products and expanding its footprint.

“The integration of the Workfront product is well on the way, and that really has the potential to change the future of work for Adobe users,” he said, referring to last year’s $1.5 billion acquisition of the marketing software firm Workfront Inc.

Adobe’s plan is to integrate Workfront’s software with its Experience Cloud offering, which is used to manage customized marketing campaigns, content delivery, analytics, data, advertising and customer journeys. Workfront’s tools are used by marketers to manage content, execute workflows across teams, and plan and track their marketing campaigns.

Mueller’s colleague at Constellation Research, Liz Miller, said investors are most interested to see how fast and how far the integration of Workflow will take Adobe’s strong revenue momentum.

“AI has been a big winner for Adobe across both its Creative and Experience clouds, with new smart features helping to make users hypercreative and hypereffective, eliminating lots of the grunt work,” Miller said. “Another thing to keep an eye on is how far the integration with Frame.io can take this new era of collaboration between Adobe’s Creative and Experience clouds.”

For the fourth quarter, Adobe is targeting earnings of $3.18 per share on $4.07 billion in revenue. That’s better than expected, with Wall Street analysts modeling $3.08 per share in earnings and $4.04 billion in sales.

Photo: Adobe MAX/Flickr