SAN JOSE (dpa-AFX) - Adobe Systems Inc. (ADBE) Tuesday said it would eliminate about 750 full-time positions primarily in North America and Europe, and expects to record related pre-tax charges of $87 million to $94 million. Current-quarter earnings are expected to be impacted by about $0.11-$0.12 per share.
For the fourth quarter ending December 2, the company altered its GAAP earnings guidance to factor the restructuring charge while reaffirming its non-GAAP earnings and revenue target range.
The company now expects fourth-quarter earnings between $0.30 and $0.38 per share, compared to prior guidance of between $0.41 and $0.50.
Adobe continues to target a diluted earnings per share range of $0.57 to $0.64 on a non-GAAP basis in the fourth quarter. With about four weeks remaining in the quarter, the company believes it will achieve fourth quarter revenue within the $1.075 billion to $1.125 billion range it previously provided on September 20, 2011. The Street currently expect earnings of $0.60 per share for the fourth quarter on revenues of $1.090 billion.
The restructuring is designed to better align resources around Digital Media and Digital Marketing.
Included in the charges are (i) approximately $17 million to $19 million primarily related to the consolidation of leased facilities and (ii) approximately $70 million to $75 million related to employee severance arrangements. The company expects to record about $73 million to $78 million of these charges in the fourth quarter ending December 2, 2011.
Adobe plans to report its fourth quarter results on December 15, 2011 after the market closes.
Adobe will discuss its fourth quarter business update and restructuring at its Financial Analyst Meeting tomorrow at 10:00 a.m. Eastern Time.
ADBE closed Tuesday's regular trading at $30.42, up $0.50 or 1.67%, on the Nasdaq. In the after-hours, the sttock lost $2.02 or 6.64%.
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