Adobe Lays Off 600 in Restructuring
The global economy is forcing many companies to cut back, and today Adobe announced significant cuts of 600 full-time employees. Unfortunately, that means one of our good friends and long-time colleagues is leaving the company: the internationally-known senior InDesign evangelist Tim Cole. Another friend, Lonn Lorenz, who has been on the print and PDF team at Adobe for many years, is also leaving today, though We’re not sure if that comes as part of the larger restructuring.
Both of these guys are extremely smart and generous with their knowledge, so we’re sure we’ll be hearing from them before too long. But it’s sad to see them leave Adobe, after so many years of excellent service to high-quality print and publishing. Our good wishes to them both. (And if you happen to know of any job openings…)
Tim Cole is out… And what about Terry White? Is he still there? I just can’t believe! Wake up Adobe!
This is very sad news indeed! I’ve read Tim Cole’s stuff for years, and he personally helped me with my complaints about the dismal CS3 Exam, and made sure I got a voucher from Adobe to retake the exam for free (which I’ll be doing very shortly).
Tim Cole came The InDesign Confernce 2008 Tokyo.
His lecture was very wonderful.
And, his blog(Adobe account) is very wonderful,too.
This is sad news. we loss…
This simply can’t be true.
Tim Cole is one of the most knowledgeable and helpful person’s I have ever come accross in the field of InDesign and Adobe.
This must be some mistake!
Don’t despair. I’m sure something big and wonderful will come out of this. Maybe being independent will help him (Tim) see stuff from another angle that’ll benefit us all in the long run. He’s not one lacking resources!
What’s about Caffé Fibonacci with Tim Cole and Rufus Deuchler? It’s a very popular format on Adobe TV.
The future? A new face instead of Tim? Rufus alone in the Caffé? The end? Please! No!
It’s a very sad news.
I hope they’ll find good opportunities outside Adobe!
Thank you all for your job in Adobe
Working for a commercial printer I have relied on both Lonn Lorenz and Tim Cole for years. Their knowledge and support will be missed!
Wish both Lonn and Tim the best!
Let’s just hope this rotten economy straightens out soon. : /
Everyone looks at Adobe differently… I look at it and wonder, “how are they going to make awesome products and tell the world about them?” But I just got this note in my email, which reminded me that a lot of people look at the company very differently:
[From Oppenheimer Research… I guess I got on some email list a long time ago from them…]
Macro catches up with ADBE. Due to the macro environment and weaker than expected CS4 sales, ADBE pre-announced 4Q08. It now expects 4Q EPS of $0.59-0.60 (including $0.05 of tax benefits) on revenue of $912-915M, compared to its prior guidance of $0.51-0.53 on revenue of $925-955M and consensus of $0.51 on revenue of $930.2 million.
FY09 to remain under pressure. ADBE also provided 1Q09 guidance which fell well short of consensus estimates. ADBE expects 1Q revenue of $800-850 million, compared to the Street’s estimate of $931.2 million. We expect the remainder of FY09 to remain challenging, as the company faces difficult comps, potential FX headwinds and a deteriorating macro environment.
Focuses on the bottom line. While ADBE’s top line will likely suffer from the challenging demand environment, the company expects to control its costs and achieve a 37-38% operating margin in 1Q09. We believe it will undertake several initiatives, such as its 600 employee headcount reduction, which should help protect its bottom line.
Cutting estimates. Our new 4Q08 EPS is $0.59 (includes tax benefit) on revenue of $914.3 million compared to our prior estimates of $0.52 and $939.7 million. We have also cut our FY09 EPS to $1.71 on revenue of $3.3 billion from $1.99 on rev of $3.8 billion.
Valuation. At $22.54, ADBE trades at 13.2x our new CY09E of $1.71,compared to its large-cap peer group average at 11.5x. We expect the shares to face some near-term pressure and see fair value in the high teens. We would look to get more constructive on the name below these levels.
Wow. More tough times to come? Sigh.
Are they nuts?!
I see this as a symptom not only of economic problems, but the increasing Macromediafication of Adobe. Print is so old-world, after all: Flash is the future. Web applications. No paper! Sheesh.
While I applaud Adobe’s (somewhat late-blooming) growth in Web solutions, it breaks my heart to see print get such short shrift. I think they’re losing their balance and ignoring an important audience that made them the Great Red Presence.
It’s hard not to take this personally, especially when it affects people I’m fond of. I hold both Lonn and Tim in very high esteem, and while I can’t imagine they won’t land well, we’ve lost some patron saints inside Adobe.
Claudia, the cuts were worldwide. A lot of people associated with web applications were let go, too.
Bad news already around. Doesn’t seem like a wise move on Adobe’s part. They seemed to have lost a lot of valuable people based on one underwhelming quarter of revenue.
Caffé Fibonacci with Tim Cole and Rufus Deuchler is a must watch. I have had the pleasure of being taught by Rufus, he’s great. But the two of them together – they are a wonderful double act. I love the humour. It’s sad to see Tim go and I hope the Caffé continues, but it won’t be the same, that’s for sure.
It really doesnt surprise me that sales of cs4 are lacking. uAdobe software is super expensive. I take a look at Indesign CS4 and I (not a power user) see it as a little more polished, maybe slightly better performance, and more or less tweaked a little. The price Adobe wants for these upgrades is nuts. For many people working on cs2 or cs3, that is more than enough and who is going to justify these prices. I look at photoshop and can clain the same thing. The problem all the software companies have (including microsoft) and maybe even apple is that these programs dont offer any breakthroughs and they have matured. Look at Microsft word. People use it for letters, reports, the basics. A small percentage of users probably 10% use some of the other stuff. Now how are you going to get companies to upgrade? You won’t. Google might kill them all with their cloud platforms. And adobe has not adapted to the web much either.
@robert weisberg: “The price Adobe wants for these upgrades is nuts.”
The Amazon upgrade price for ID CS4 is right now $197. I submit that anyone who calls that amount “nuts” isn’t even anywhere near that group for which all Adobe’s software (except the consumer Elements versions) is made — namely graphics professionals. The upgrade prices, for both single apps and the Suites, are just peanuts — and for that amount we get access to world-class software created by some of the smartest people on the planet!
Whatever gripes we graphics folks may have against Adobe, their (US) prices shouldn’t be among them. I’ve long held that whoever gripes about the cost of Adobe software is thereby declaring himself to be an amateur and not a professional.
It’s really sad to see some excellent peoples like Tim and Lonn leaving Adobe indeed. I’m sure they will continue to be extremely valuable where ever they will end up. Also don’t forget, I have seen in the past peoples come and go from Adobe, so they might come back to Adobe in the future.
Klaus should realize that the functionality of cs3 and for that matter cs2 is more than adequate for most. $200.00 for one app upgrade, or 599 for the design package upgrade. Sounds like he works for the company or holds plenty of Adobe stock. Personally I would rather see some performance improvements in cs4.
The US economy is weak, same with worldwide economy. Companies are not spending money to upgrade software that is fuctional. Microsoft knows this as well since vista sales and office upgrades have bombed out with the big companies. I use the software for my company catalogs and sales materials. My work looks as good as “any” graphics professional. In fact I work with many big companies who comment on the quality of our layouts etc. We do functional work not flashy award winning high end stuff. I would not be surprised to see cs4 as one of the weakest products from adobe in many years.
I am shocked that Tim and Lonn were let go.
But I also feel that there has been an inordinate emphasis on web tools. The same sort of mentality that caused Macromedia stock to become so de-valued that Adobe was able to BUY (not merge with) Macromedia.
However, you would never know that the web-centric attitudes of Macromedia was a problem at all — especially not after the keynote at the recent Adobe MAX event.
If you were a visitor from another planet who had stumbled into that auditorium, you would have been totally convinced that the ONLY ouput for ALL Adobe products was “to the monitor or web.”
The word “print” never once appeared on screen.
I know that there were several Adobe employees who were not happy with such a web-centric speech.
Letting go of Tim and Lonn only confirms this nonsense.
Well, there are still a lot of print folks at Adobe, of course. And after a little bit of investigation, I can confirmed that:
a) The cuts were across-the-board, and there were evangelists, developers, and managers from all teams (including web, etc.) that got cut;
b) The InDesign team actually ended up with very few people having to leave the team. I think they dealt with it via reassignments, attrition, etc.
So the bad news is that we’ve lost some excellent resources (for the time being, until they pop up as president of the World Bank or something); the good news it that InDesign is actually in pretty darn good shape (both print and rich media aspects of it), heading into the run toward CS5.