Adobe

Key Performance Metrics

  • The review of Net Profit Margin witnessed a fluctuating trend. The Net Profit Margin improved from 26.42% in 2019 to 27.97% in 2023.
  • The average EBIT Margin for the period under analysis was 34.13%, with 2019 and 2021 performing the worst and best,
  • In the current year, Adobe was able to cover its interest liabilities 58.12 times in the current year- compared to 2019 when it was 21.41 times.
  • The Asset turnover stood at 0.69 times in 2023 from 0.56 in 2019, implying a low performance on Assets of the business in relation to revenue.

Profitability

  • The revenue of Adobe has increased year on year. The revenue increased by 15.19% between 2019 and 2020 and a further 11.54% increase was recorded between 2021 and 2022. There also occurred an increase of 10.24% between 2022 and 2023 (the current period).
  • Adobe’s performance in profitability looks good as the return on capital employed also recorded good performance during the period of analysis.

Liquidity

  • The company’s result in liquidity looks poor, as the current ratio decreased from 1.11:1 to 1.34:1 on the last year. Which implies that the company does not has enough assets to settle its current liabilities.

Capital Structure

  • Adobe is both equity and debt financed.
  • The debt-to-equity (D/E) ratio has been increasing year on year. The gearing position of the company appears to be low as it stood at 25% in the current year.

Source: Adobe Annual Report

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