Adobe Systems Inc. ADBE recently expanded its 3D animation service with the purchase of 3D modeling company, Mixamo. However, the financial terms of the deal have not been disclosed.
Launched in 2008, San Francisco-based Mixamo offers a 3D platform that allows designers to create and customize high quality 3D characters and animations and incorporate into games in a simple and intuitive way.
Adobe intends to integrate Mixamo’s technology into its Photoshop Creative Cloud. This will enable customers to create, customize, manipulate and animate new 3D content which can be used in either pictures or animation. The designers can also use thousands of pre-built 3D characters which can easily be incorporated into projects.
Also, Mixamo’s technology will add more environment options, such as realistic lighting, shadows and reflections, helping designers to produce greater output options in both still and motion.
The Mixamo acquisition syncs well with Adobe’s strategy to move from 2D to 3D technology. Last year, Adobe incorporated 3D compositing and printing to its Photoshop offering. The acquisition will help Adobe boost sales by adding new customers as more designers are now interested in using 3D assets in media projects.
Adobe’s Creative Cloud is a set of services that includes tools like Photoshop, Indesign and Illustrator. Beginning in spring 2013, Adobe began delivering these tools via subscription service on the cloud. Attractive pricing, as well as frequent product, feature and service enhancements continue to drive Adobe’s Creative Cloud subscription growth.
We believe that the increased adoption of Adobe’s Photoshop will serve as a potential catalyst aided by the Mixamo buyout. We expect such noteworthy synergies to boost revenues over the long term. The company’s growth strategies and solid execution are the other positives.
Adobe currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the sector are Aspen Technology, Inc. AZPN, Advent Software, Inc. ADVS and Cadence Design Systems Inc. CDNS. While Aspen and Advent sport a Zacks Rank #1 (Strong Buy), Cadence Design has a Zacks Rank #2 (Buy).
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