Merrill Lynch cut Adobe Systems (ADBE ) to near-term neutral from strong buy.
Analyst Jay Vleeschhouwer says in the company's intra-quarter update, Adobe cited lower than expected revenues in July across all most businesses. He notes product deterioration across many areas, with PhotoShop likely to be well below his estimates.
He says most other products will likely be lower, reflecting difficult conditions in specific end markets -- though Acrobat might still turn out to be about flat. He cut his $1.01 fiscal 2002 (Nov.) earnings per share estimate to $0.87, and cut the $1.21 fiscal 2003 to $1.01.
Vleeschhouwer is keeping his long-term strong buy, and thinks Acrobat's product leadership is intact.