Shares of the creative and marketing software company Adobe Inc. jumped in late trading today on the back of strong earnings and revenue beats and a somewhat mixed outlook.

The company reported second-quarter earnings before certain costs such as stock compensation of $4.48 per share on revenue of $5.31 billion, up 10% from a year earlier. Both numbers came in ahead of Wall Street’s forecasts, with analysts looking for earnings of just $4.39 per share on lower sales of $5.29 billion.

The results also beat the company’s own guidance range, as Adobe had previously called for earnings of just $4.35 to $4.40 on revenue of $5.25 billion to $5.3 billion.

Adobe’s bottom line improved as a result of the double beat, with its net profit rising to $1.573 billion in the quarter, up from $1.295 billion one year earlier.

The company’s rose more than 15% in extended trading, after declining slightly earlier in the day.

Adobe said its strong results were driven by growing adoption of generative artificial intelligence technologies throughout its product suite. They come after similarly strong results from Oracle Corp. and Broadcom Inc. this week, with both of those companies also citing AI as a major sales and profit driver.

Chief Executive Shantanu Narayen (pictured) said the company is “driving strong usage, value and demand” for AI across all customer segments. In addition, he said the company is seeing “early success monetizing new AI technologies across our Digital Media and Digital Experience” business segments. “Our highly differentiated approach to AI and innovative product delivery are attracting an expanding universe of customers and providing more value to existing users,” he added.

The company revealed net new digital media annualized recurring revenue of $487 million, easily beating its forecast of $440 million. That’s a closely watched metric these days, as it’s the strongest measure of the performance of Adobe’s subscription-based offerings. In addition, the company ended the quarter with total digital media ARR of $16.25 billion.

The Digital Experience business unit, which houses Adobe’s data insights and commerce products, delivered revenue of $1.33 billion in the quarter, at the upper end of Adobe’s guidance range of $1.31 billion to $1.33 billion. Meanwhile, the Digital Media segment, which includes products like Creative Cloud and Document Cloud, raked in $3.91 billion in sales, also beating its own guidance and above the Street’s target of $3.89 billion.

Third Bridge analyst Charlie Miner said Adobe’s performance in the quarter went some way toward easing investors’ concerns that AI might turn out to be more of a disruption to its businesses, rather than a benefit.

“Adobe delivered with a double beat and raise, finally inspiring enthusiasm from investors that the monetization of their AI tools could soon materialize,” the analyst said. “Adobe continues to successfully balance the tightrope between growth and margin expansion despite the temptation to overspend during this AI investment cycle.”

Miner also praised the effectiveness of Adobe’s first AI features, saying they have the potential to transform the creative toolset it offers to design professionals. “AI is unlocking creativity for non-creators, potentially increasing the total available market by 20% to 35%, according to our experts,” he said.

Looking to the third quarter, Adobe is forecasting total revenue of $5.33 billion to $5.38 billion, with $460 million in digital media net new ARR. Digital Media sales are expected to land between $3.95 billion and $3.98 billion, while Digital Experience revenue is forecast to fall between $1.325 billion and $1.345 billion. As for earnings, Adobe offered a range of $4.50 to $4.55 per share.

Those numbers are somewhat mixed, with Wall Street’s analysts calling for slightly higher revenue of $5.4 billion and lower earnings of $4.47 per share.

Though some investors may be a little upset about the lower revenue guidance, they didn’t show it, possibly because Adobe edged up its annual forecast from a range of between $21.3 billion and $21.5 billion to between $21.4 billion and $21.5 billion. In addition, the company is now calling for net new digital media ARR of $1.95 billion, up from $1.9 billion three months ago.

Adobe said it also sees full-year earnings rising to between $18 and $18.20 per share, higher than its previous range of $17.60 to $18 per share.

Photo: Fortune Live Media/Flickr