Brad Zelnick: Okay. Thank you.
Operator: We will take our next question from Brent Thill with Jefferies. Please go ahead.
Brent Thill: Dan, if you could just review the broader assumptions in your guide. I think there’s still a little concern from the Street in terms of why you’re guiding, where you’re guiding relative to where the Street was at. And maybe just tying in Shantanu to the guidance, if you could just give us your topline view of — do you feel like the environment’s improving, do you think it’s just stabilizing? Just any thoughts in terms of from a high level, what you think is happening as we go into next year?
Dan Durn: Yeah. So thanks for the question, Brent. When we take a look at the guide. If we think about where we’re at, at this point in time as we’re looking forward in FY ’24, clearly we see a lot of momentum in the business, the company’s engine of innovation has been incredibly strong. And you see the strong financial performance of the company. That’s both from a top line standpoint, as well as profitability and cash-flow standpoint. So, clearly a lot of momentum around the business. As I think about where we sit today, we printed a 46.4% operating margin. As we look forward in to next year, we take into account everything we can see. As Shantanu said, we take the guidance seriously and we set expectations in a prudent way, there is an opportunity to do better than the expectations that we set.
Clearly, the company is going to be driving towards that. As we think about the engine of innovation, we think the pipeline is strong, we’re going to continue to invest in the drivers of growth. This company is going to orient towards growth. When I think about the investment profile, not only are we going to be disciplined. But we’re going to continue to invest in those drivers of growth on the DX side. Anil talked about AEP and Apps strong book of business, strong growth, we’re laying the groundwork and content supply chain with the GenStudio solution, scaling that motion, and engaging with customers to go from ideation, to creation to activation, delivering new technologies, products, AEM sites incorporating intelligence into those products.
On the DME side, you can see it across the portfolio, AI assistant Acrobat, it’s in private beta, and it’s going to be in public beta in the coming months, you look at Firefly and Express, natively and deeply integrating these technologies throughout the product portfolio, there is going to be continual investment as it relates to that innovation. As you think about the momentum exiting this year and as you think about the guide into Q1, you can see that momentum continuing, get the operating margin up a little bit, and then throughout the year, as we said at our FA Day and the last year’s earnings call, you can see a mid-40s expectation around operating margin for the company as we drive this investment cycle, as we drive leadership in our core markets and our key catalyst in the trends that are shaping those markets.
So, again, taking a step back, it nets into account the macro that Anil talked about everything we see from a core business standpoint, and the investment profile that we’re going to drive to lead, if there’s an opportunity to do better than where we set those expectations we’re certainly going to do it.
Shantanu Narayen: And maybe just to add to that, Brent, since you asked. First, let me clarify, there is nothing as it relates to the economic indicators that we saw anything that would give us cause for concern. So, let me start off by saying that, I think at our Investor Meeting, we told you that we would expect a strong quarter, I think you would acknowledge, we posted some really strong numbers and the momentum continues. And I think as it relates to Creative Cloud, it’s going to be driven by new customer acquisition, which is the engine that’s driven the business and maybe perhaps the sell-side looked at some of the pricing and put more of that in ’24 then in ’24 and ’25 and that will spread out and perhaps they put a little bit more in what percentage of the base that impacts.
So from my perspective, the good news about Creative is it’s being driven by massive new adoption into the platform. On Document Cloud, really strong results. I think as Dan said, as we put the AI pack on there as well, that should help fuel more adoption and Digital Experience, I mean, I know that Brad also asked that question. I mean it’s great to see the adoption of AEP and Apps. I mean, that is clearly the future of digital experiences, driving $100 million quarter, the $700 million in the annualized book of business, which I think will reflect the next-generation customer experience architecture. So we’re feeling positive. And we’re going go execute against that Brent. So, nothing that we see on the horizon would tell us either from the economic or competition, that we’re not poised to have another great year and profitability as well, I mean, look at the numbers that we posted both in terms of Q4, as well as for fiscal ’24 and that is that does not in any way mean that we’re not going to invest in all of the cloud and the foundation models.
So I feel really good.
Dan Durn: And then just one thing to add, Brent, If we were here a year ago, the expectations going into the year where FX was going to be a pretty decent headwind to the performance, you see that in the way we’ve reported our results and then compare it to a constant-currency basis. We started with a pretty decent spread between the as-reported numbers in constant-currency in Q1. By the time we got to Q4, you saw that spread compress, as I look forward into FY ’24, it’s more of a neutral footing to maybe a slight headwind. Too early to really call it with precision, but I see that setup being slightly different. And maybe just a slight headwind versus what we were seeing a year ago.
Brent Thill: Thanks for the color.
Operator: We’ll will take our next question from Jay Vleeschhouwer with Griffin Securities. Please go ahead.
