May 2, 2006

Adobe expects low end of target range in Q2

Press Release: SAN JOSE, Calif. — May 2, 2006 — Adobe Systems Incorporated (NASDAQ: ADBE) today is providing its regular intra-quarter business update for its second quarter of fiscal 2006, which ends June 2, 2006.

With approximately five weeks remaining in the quarter, Adobe announced it believes it will achieve quarterly results toward the low end of the financial target ranges it provided on March 22, 2006. The Company’s Q2 FY2006 target ranges are the following: revenue of $640 to $670 million; GAAP earnings per share of $0.18 to $0.21; non-GAAP earnings per share of $0.30 to $0.32; a GAAP operating margin of 22 to 24 percent; and a non-GAAP operating margin of 37 to 38 percent.

In its update, the Company indicated it experienced weaker than expected demand during the Spring holiday periods in Europe and North America. The Company plans to report its second quarter fiscal 2006 results on June 15, 2006 after the market closes.

Adobe Announces Webcasts of Upcoming Investor Conference Participation

Adobe also announced participation in the following May events with the financial community:

Baird 2006 Growth Stock Conference
Chicago, IL
Thursday May 11, 2006
8:45 a.m. Eastern Time
Murray Demo, Executive Vice President and CFO

JPMorgan Technology Conference
San Francisco, CA
Tuesday May 23, 2006
11:00 a.m. Eastern Time
Bruce Chizen, CEO

UBS Enterprise Technology & Services Conference
New York, NY
Wednesday May 24, 2006
8:00 a.m. Eastern Time
Bruce Chizen, CEO

These investor conference presentations will be Webcast from Adobe’s Web site at:

Conference presentation times are subject to change at the discretion of the conference host. An archive of each Webcast will be available for a limited time.

Forward Looking Statements Disclosure
This press release contains forward looking statements, including those related to revenue, operating margin and earnings per share, which involve risks and uncertainties that could cause actual results to differ materially. Factors that might cause or contribute to such differences include, but are not limited to: adverse changes in general economic or political conditions in any of the major countries in which Adobe does business, delays in development or shipment of Adobe’s new products or major new versions of existing products, introduction of new products by existing and new competitors, failure to successfully manage transitions to new business models and markets, difficulty in predicting revenue from new businesses, failure to anticipate and develop new products in response to changes in demand for application software, computers and printers, intellectual property disputes and litigation, inability to protect Adobe’s intellectual property from unauthorized copying, use, disclosure or malicious attack, failure to realize the anticipated benefits of past or future acquisitions and difficulty in integrating such acquisitions, changes to Adobe’s distribution channel, disruption of Adobe’s business due to catastrophic events, interruptions or terminations in Adobe’s relationships with turnkey assemblers, risks associated with international operations, fluctuations in foreign currency exchange rates, changes in accounting rules and regulations, impairment of Adobe’s goodwill or intangible assets, unanticipated changes in or interpretations of tax rates, Adobe’s inability to attract and retain key personnel, and market risks associated with Adobe’s equity investments. For further discussion of these and other risks and uncertainties, individuals should refer to Adobe’s SEC filings. Adobe does not undertake an obligation to update forward looking statements.

Non-GAAP Financial Targets (32KB PDF download)

About Adobe Systems Incorporated
Adobe revolutionizes how the world engages with ideas and information – anytime, anywhere, and through any medium. For more information, visit

© 2006 Adobe Systems Incorporated. All rights reserved. Adobe and the Adobe logo are either registered trademarks or trademarks of Adobe Systems Incorporated in the United States and/or other countries.

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