Adobe Inc. (ADBE) shares slumped lower Thursday after the world's third-largest cloud software group agreed to buy privately-held design startup Figma for around $20 billion and forecast softer-than-expected near term sales.
Adobe will use both cash and stock to pay for the San Francisco-based platform design group, which is used by companies such as Zoom Video (ZM) and Coinbase (COIN), the group said Thursday, confirming an earlier report from the Wall Street Journal.
The deal, which is expected to close next year, includes a $1 billion break-up fee for both sides, with Figma CEO Dylan Field expected to continue leading the group when its folded into Adobe.
Adobe also posted record revenues of $4.43 billion for the three months ending on September 2, its fiscal third quarter, a 13% increase from last year, with an adjusted non-GAAP bottom line of $3.40 per share.
Looking into the current quarter, however, Adobe said it sees revenues of around $4.52 billion, a tally that came in just shy of forecasts from Refinitiv, as strong dollar headwinds continue to weigh on overseas sales.
"Fueled by our groundbreaking technology, track record of creating and leading categories and consistent execution, Adobe delivered another record quarter,” said CEO Shantanu Narayen. “With the announcement of our intent to acquire Figma, we believe we have a unique opportunity to usher in a new era of collaborative creativity.”
Adobe shares were marked 17.1% lower in early Thursday trading to change hands at $307.84 each.
