Together with Microsoft, Adobe is leveraging artificial intelligence to push deeper into customer relationship management and create a “brand-new category and industry,” Adobe’s CEO, Shantanu Narayen, told CNBC on Friday.
“That’s where the Adobe and Microsoft partnership is so valuable, because … we think we are actually creating a brand-new category and industry, which is all about digital engagement and customer experience management,” Narayen said on “Squawk Alley.”
Adobe reported fiscal third-quarter earnings and revenue on Thursday that beat Wall Street expectations. It also showed 21 percent revenue growth, year over year in its new experience cloud segment, a cloud-based enterprise business that leverages Adobe Sensei’s machine learning and artificial intelligence capabilities to tackle customer relationship management. Revenue from the new segment, launched in 2017, has already surpassed that of Adobe’s document cloud.
Narayen said Adobe and Microsoft make such effective partners because Microsoft’s cloud platform Azure enables businesses to “process the data at the pace they want” and Adobe’s enterprise solutions allow businesses to “attract customers to the platform and engage it.”
“We continue to think content and data and how content and data come together is really how this magic happens. … It’s all about what is the right content being delivered based on the intelligence,” Narayen said. “I think it’s a dramatically different approach that Adobe has pioneered.”
Furthermore, acquisitions, like the $1.68 billion purchase of e-commerce platform Magento that Adobe announced in May, prop up Adobe’s continued forays into customer relationship management. The purchase gave Adobe an e-commerce platform that will work with its experience cloud, and ups its competitive edge against Salesforce, which has its own cloud-based sales and marketing offerings.
For now, Narayen wouldn’t reveal if more acquisitions should be expected from Adobe, but said the company is still focusing on integrating Magento. Narayen did, however, name a few requirements for future acquisitions.
“When we look at what would make sense for Adobe, we are really focused on — do companies have great technology, are they the right people and how does it completely transform what we can do as a business,” he said.
Adobe shares were up 2.4 percent to $274.96 midafternoon Friday.