Adobe Inc., adjustment to net income

US$ in millions

12 months ended:	Dec 1, 2023	Dec 2, 2022	Dec 3, 2021	Nov 27, 2020	Nov 29, 2019	Nov 30, 2018
Net income (as reported)	5,428)	4,756)	4,822)	5,260)	2,951)	2,591)
Add: Unrealized gains (losses) on available-for-sale securities	24)	(39)	(8)	3)	29)	(24)
Less: Reclassification adjustment for recognized (gains) losses on available-for-sale securities	5)	—)	—)	(1)	—)	11)
Net income (adjusted)	5,457)	4,717)	4,814)	5,262)	2,981)	2,577)

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Adobe Inc., adjusted profitability ratios

	Dec 1, 2023	Dec 2, 2022	Dec 3, 2021	Nov 27, 2020	Nov 29, 2019	Nov 30, 2018
Net Profit Margin
Reported net profit margin	27.97%	27.01%	30.55%	40.88%	26.42%	28.69%
Adjusted net profit margin	28.12%	26.79%	30.50%	40.89%	26.68%	28.54%
Return on Equity (ROE)
Reported ROE	32.86%	33.85%	32.59%	39.66%	28.03%	27.67%
Adjusted ROE	33.04%	33.57%	32.53%	39.67%	28.31%	27.53%
Return on Assets (ROA)
Reported ROA	18.23%	17.51%	17.70%	21.66%	14.22%	13.80%
Adjusted ROA	18.32%	17.36%	17.67%	21.67%	14.36%	13.73%

Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Adobe Inc. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by shareholders’ equity.	Adobe Inc. adjusted ROE improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by total assets.	Adobe Inc. adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

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	Dec 1, 2023	Dec 2, 2022	Dec 3, 2021	Nov 27, 2020	Nov 29, 2019	Nov 30, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income	5,428)	4,756)	4,822)	5,260)	2,951)	2,591)
Revenue	19,409)	17,606)	15,785)	12,868)	11,171)	9,030)
Profitability Ratio
Net profit margin¹	27.97%	27.01%	30.55%	40.88%	26.42%	28.69%
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in millions)
Adjusted net income	5,457)	4,717)	4,814)	5,262)	2,981)	2,577)
Revenue	19,409)	17,606)	15,785)	12,868)	11,171)	9,030)
Profitability Ratio
Adjusted net profit margin²	28.12%	26.79%	30.50%	40.89%	26.68%	28.54%

2023 Calculations

¹ Net profit margin = 100 × Net income ÷ Revenue
= 100 × 5,428 ÷ 19,409 = 27.97%

² Adjusted net profit margin = 100 × Adjusted net income ÷ Revenue
= 100 × 5,457 ÷ 19,409 = 28.12%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Adobe Inc. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

	Dec 1, 2023	Dec 2, 2022	Dec 3, 2021	Nov 27, 2020	Nov 29, 2019	Nov 30, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income	5,428)	4,756)	4,822)	5,260)	2,951)	2,591)
Stockholders’ equity	16,518)	14,051)	14,797)	13,264)	10,530)	9,362)
Profitability Ratio
ROE¹	32.86%	33.85%	32.59%	39.66%	28.03%	27.67%
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in millions)
Adjusted net income	5,457)	4,717)	4,814)	5,262)	2,981)	2,577)
Stockholders’ equity	16,518)	14,051)	14,797)	13,264)	10,530)	9,362)
Profitability Ratio
Adjusted ROE²	33.04%	33.57%	32.53%	39.67%	28.31%	27.53%

2023 Calculations

¹ ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × 5,428 ÷ 16,518 = 32.86%

² Adjusted ROE = 100 × Adjusted net income ÷ Stockholders’ equity
= 100 × 5,457 ÷ 16,518 = 33.04%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by shareholders’ equity.	Adobe Inc. adjusted ROE improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.

	Dec 1, 2023	Dec 2, 2022	Dec 3, 2021	Nov 27, 2020	Nov 29, 2019	Nov 30, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income	5,428)	4,756)	4,822)	5,260)	2,951)	2,591)
Total assets	29,779)	27,165)	27,241)	24,284)	20,762)	18,769)
Profitability Ratio
ROA¹	18.23%	17.51%	17.70%	21.66%	14.22%	13.80%
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in millions)
Adjusted net income	5,457)	4,717)	4,814)	5,262)	2,981)	2,577)
Total assets	29,779)	27,165)	27,241)	24,284)	20,762)	18,769)
Profitability Ratio
Adjusted ROA²	18.32%	17.36%	17.67%	21.67%	14.36%	13.73%

2023 Calculations

¹ ROA = 100 × Net income ÷ Total assets
= 100 × 5,428 ÷ 29,779 = 18.23%

² Adjusted ROA = 100 × Adjusted net income ÷ Total assets
= 100 × 5,457 ÷ 29,779 = 18.32%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by total assets.	Adobe Inc. adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

Adobe Inc. (NASDAQ:ADBE)

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