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Adobe Creative Cloud Subscriptions Climb to 1.8 Million

Most Sales of CS6 Licenses to Be Discontinued Later This Year

Adobe said Creative Cloud (CC) individual and team subscriptions grew to more than 1.8 million as of February 28, an increase of more than 405,000 from the previous quarter. During the first fiscal quarter ending February 28, the company said, the majority of its revenue came from subscriptions to CC and the company's Marketing Cloud offerings.

Executives said the company hopes to stay on that path, expecting to add another 400,000 CC subscribers in the second quarter.

With subscriptions generating more money for Adobe than perpetual software licenses for the first time, the company is staying on track with its previously announced plan to eliminate perpetual licenses later this year.

"We will soon end general availability of CS6 perpetual licensing in the channel," said Adobe Executive VP and CFO Mark Garrett during a conference call with investors earlier today. "This decision is consistent with our comments last December, when we stated we expected no material revenue from perpetual licensing of CS6 in the second half of fiscal 2014."

There was no concrete news during the call on any new releases of CC products, though Garrett did allude to a "major launch of our creative products" in the second half of the fiscal year that he said would drive CC adoption, along with the elimination of CS6 sales. That means CC users could have something to look forward to as early as this June, even as Adobe sends CS6 riding off into the sunset.

Responding to questions from analysts, Adobe President and CEO Shantanu Narayen admitted that CS6 will remain available in some form, although it is being pulled from Adobe's retail partner channel. For example, he said electronic software downloads of CS6 will still be available, while noting that "the vast majority" of all those who purchase directly from Adobe.com are already going for Creative Cloud. "We feel that the [CC] offering coming out later this year will be so strong that CS6 will look longer in the tooth," Narayen said.

Adobe executives reiterated their previous expectations of signing up 3 million Creative Cloud subscribers by the end of fiscal 2014.

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