Software company Adobe Inc. posted a fiscal first-quarter profit and revenue that topped expectations today, but its outlook for the next quarter was lower than expected, sending its stock down in after-hours trading.

The company reported first-quarter earnings of $3.37 per share on sales of $4.26 billion, up 9% from a year ago. Its net income for the period came to $1.26 billion. Wall Street had been looking for earnings of just $3.34 per share on revenue of $4.24 billion.

Adobe’s stock fell 2% in after-hours trading, having risen by almost 3% in the regular session in a strong day for tech stocks.

Adobe Chief Executive Shantanu Narayen (pictured) said the company delivered record revenue because its Creative Cloud, Document Cloud and Experience Cloud products are all pivotal in driving the digital economy. “Adobe is committed to empowering individuals, transforming businesses and connecting communities,” the CEO said.

Adobe is best known for its iconic Photoshop image editing tools, but it sells various kinds of software under its three cloud units. The Creative Cloud bundles Photoshop and other tools for creative professionals and delivered first quarter revenue of $3.11 billion, up 9% from a year ago.

The largest of those is Creative Cloud, which includes Photoshop and other tools for creative professionals. That segment pulled in revenue of $2.55 billion in the quarter, up 7% from the year before. The Document Cloud meanwhile bundles Adobe Acrobat with its e-signature tools and added $562 million, up 17% from a year ago. Together, those two units make up Adobe’s “Digital Media” business, which generated a combined $3.11 billion in revenue.

As for Adobe’s Experience Cloud, it encompasses its marketing software and analytics services and is known as its Digital Experience business. It pulled in $1.06 billion in revenue, up 13% from the same period a year ago.

Adobe also reported remaining performance obligations of $13.83 billion, up 19% from last year. That’s an encouraging sign, as RPO is a key metric that represents the total future performance obligations arising from its contractual relationships. In other words, it’s the sum of the invoiced amounts and future amounts not yet invoiced, relating to its contracts with customers.

During the quarter, Adobe held its annual Adobe Summit event, where it announced its ambitions to provide all the tools creators need to build the metaverses that some believe will come to dominate the future of the internet.

Constellation Research Inc. analyst Liz Miller told SiliconANGLE that Adobe’s lower revenue growth of 9%, compared to over 20% in the previous quarter, illustrates the reality that tech companies are now entering a post-pandemic revenue world where they’ll have to wave goodbye to record-breaking growth quarters every three months. She said that while Adobe’s slower growth probably disappointed some investors, the lower number is more likely to be indicative of its natural expansion that comes from its ongoing innovation.

“Based on what we just saw at Adobe Summit, Adobe is readying itself to be a linchpin in future forward advancements like the Metaverse and the new commerce and digital economies that Web3 is predicted to spawn.” Miller said. “Keep your eyes on the steady growth and opportunity from new innovations like Creative Cloud Express and product integrations across both the Workfront and Frame.io acquisitions.”

Before offering its guidance for the second quarter, Adobe told investors that the company halted all new sales of its products and services in Russia and Belarus in response to the Ukrainian conflict. It said it expects revenue in fiscal 2022 to be reduced by around $75 million because of this. The company said it will continue to provide digital media services in Ukraine, but it said its annual recurring revenue from there will likely be reduced to around $12 million. The result will be a total revenue shortfall of $87 million for the full year, Adobe said.

With that in mind, Adobe offered a forecast for the second quarter of about $4.34 billion in sales and earnings of $3.30 per share. That was lower than expected, with Wall Street targeting revenue of $4.39 billion and earnings of $3.35 per share.

Adobe did not offer an updated full-year forecast.

Photo: Adobe MAX/Flickr