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Last Updated: Friday, 17 June, 2005, 05:49 GMT 06:49 UK
Adobe shares dip as it plays safe
Adobe office in San Jose
Adobe will add Macromedia features to its products
Shares in US software firm Adobe fell 6% in after-hours trading after it unveiled worse-than-expected profits and made a cautious quarterly forecast.

The firm, known for its Acrobat and Photoshop software, saw second-quarter profits rise 37% to $149.8m (82m).

Sales rose to $496m, helped by sales of its Creative Suite 2 software bundle.

However, Adobe did not update its full-year guidance and forecast third-quarter profit of $470m to $490m, slightly below analysts' expectations.

The company said it would provide a mid-quarter update.

Its shares fell to $30.42 in electronic after-hours trading in New York.

Year ahead

Adobe is going through a period of transition where it is trying to raise its profile with business customers

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It wants to strengthen its position as a provider of software for managing electronic documents.

The firm agreed to buy software firm Macromedia for $3.4bn earlier this year and said the deal was on track to be completed in the autumn.

The Macromedia acquisition fits in with this strategy because it has a number of leading products for creating and livening up websites, for example with computer animation.

Adobe said sales of its Creative Suite 2 suite, which includes Acrobat software for displaying electronic documents and its Photoshop software for editing digital photos, were going well.

It has also introduced a new version of Acrobat.

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