Hate TPS reports?... You'll hate this story. Adobe, the digital design company that invented the PDF, has quietly grown to a $130B in value by market cap, after setting a record quarterly profit of $2.7B. Its mission statement is bold, but confusing:
"Adobe...gives everyone — from emerging artists to global brands — everything they need to design and deliver exceptional digital experiences."
It makes money because digital things need to look good... Adobe's a SaaS company (software-as-a-service) that brings in monthly revenue for its software, mostly from businesses:
- PDF: You use it and hope it's "ctrl+F"-able. Adobe invented it in '93.
- Adobe Illustrator: For professional designers who choreographed the graphics in whatever app you were just on.
- Adobe Photoshop: The photo filter from before Insta-filters.
- Adobe Spark Post: This new-ish app was built with social media in mind, offering small businesses beautiful templates to easily turn into shareable biz posts.
Adobe's profit margins are why investors love software... Every buck Adobe earns in subscription revenue costs it only $0.15 to produce. That shows how software is way more scalable than a car — GM's costs are much higher (think equipment, factories) at $0.93 for each dollar of a sale. Profits come easier when adding a customer only requires a new username/password, instead of metal and four wheels.