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Adobe Systems Plans to Cut 9% of Its Global Workforce (Update2)

By Rochelle Garner

Nov. 10 (Bloomberg) -- Adobe Systems Inc., the world’s biggest maker of graphic-design programs, plans to cut 680 jobs, or about 9 percent of its global workforce, as the company copes with a lingering sales slump.

Adobe will record $65 million to $71 million in pretax expenses, including costs for shutting offices and severance pay, according to a regulatory filing today. Adobe expects to report additional costs related to its $1.8 billion purchase of Omniture Inc. last month.

Adobe Chief Executive Officer Shantanu Narayen is dealing with a slowdown in demand for software from advertisers and other creative professionals. The latest reduction follows a round of 600 job cuts in December 2008 that equaled about 8 percent of the San Jose, California-based company’s workforce.

Sales have been falling as customers delay buying the current version of Adobe’s Creative Suite, a collection of programs including Illustrator and Photoshop that accounts for more than 60 percent of revenue. The company is readying its next version of the software, called Creative Suite 5, to be released sometime next year.

Adobe bought Omniture to gain software that tracks the performance of Web sites and online advertising campaigns. Adobe plans to combine its programs that create media and Web sites with Omniture’s technology, Narayen said in September. The combination will help Adobe’s design customers devise online campaigns.

Omniture is Adobe’s second-biggest purchase, after its 2005 acquisition of Macromedia Inc. for $3.4 billion. Adobe said last month that it’s cutting about 9 percent Omniture’s workforce. Those reductions are separate from the ones announced today.

Adobe rose 15 cents to $36.60 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have advanced 72 percent this year.

To contact the reporter on this story: Rochelle Garner in San Francisco at rgarner4@bloomberg.net

Last Updated: November 10, 2009 18:29 EST

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