Earnings season has pretty much petered out, but there are a few interesting names on the radar this week: Adobe Inc (NASDAQ: ADBE)(postmarket today), Oracle (NYSE: ORCL)(postmarket Wednesday), and Red Hat Inc (NYSE: RHT) (postmarket Thursday), all software companies. It may be interesting for investors to consider the correlation and competition between the companies, and evaluate which has the best fundamentals and products to its name.
Red Hat is best known for its version of Linux, an open-source operating system, while Adobe's products are household names: Photoshop, PDF, etc. Oracle's subsidiaries include Taleo, a common talent acquisition software company. Adobe's stock is up over 23% this year, while Oracle's is up 18%, and Red Hat's 7%. However, artists and individuals have recently been unhappy with Adobe's products like Photoshop, as Adobe changed its policy to make users upgrade to the newest version rather than using old licenses. On the one hand, updated subscriptions means a higher revenue, and subscriptions seems to be the way of the future for software: Microsoft has implemented a similar strategy for its Office suite. On the other hand, there are alternatives to the product that cost less, and that may mean a migration of paying users away from Adobe. Although these changes are too recent to likely impact revenue this quarter, it could hurt Adobe in the future if the brand has soured for consumers.
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