Adobe has been one of the lesser-known tech success stories of the Covid crisis and the software company now looks set to benefit more than most from the permanent changes wrought by the pandemic in a post-lockdown world.

Its shares are 2 per cent higher today after second-quarter results that beat analyst expectations, with sales increasing 23 per cent to $3.84bn and subscriptions accounting for 92 per cent of total sales. The successful transition to a subs model, or annualised recurring revenue (ARR) as Adobe likes to call it, has been the making of the company in recent years, but it now sees a wider market for its software.

Creatives love tools such as Adobe Premiere for video and Photoshop for images, but “communicators” or marketing professionals are also seeing them as essential in the fight for the digital audience’s attention. Products such as stock content and analytics, advertising and ecommerce services have increased Adobe’s appeal. In addition, its document service includes its Acrobat PDFs and Sign, a digital way of signing documents that became essential during lockdown.

“When I have conversations with CEOs across every single vertical it is that the only way to engage with customers is going to be digital,” chief executive Shantanu Narayen told analysts.

“It’s the golden age of design and creativity . . . as a consumer, whether you’re interacting with a screen at a terminal or in a retail store, or how you order something . . . it’s all about content creation. And when you think about how much content we’ve all consumed in the pandemic at home, it’s just gone through the roof.”

Adobe expects such habits to continue and enterprises will become increasingly reliant on its services — it expects revenues to increase more than 20 per cent in the current quarter and its profit forecasts exceed those of Wall Street. Analysts at Jefferies said the results were “one of the strongest we’ve seen Adobe deliver” while Stifel’s say they have “confidence in Adobe’s ability to deliver a unique combination of 20 per cent growth and 40 per cent-plus margins” this fiscal year.

1. Paytm to visit IPO ATMIndian payments group Paytm has called a shareholders meeting for next month to approve an initial public offering that is being billed as the country’s largest with plans to raise up to $3bn. The group, backed by China’s Ant Group and Japan’s SoftBank, is targeting a valuation of $29bn.

2. How China is targeting Big TechChina’s State Administration of Market Regulation (SAMR) has rattled the tech sector, with first Alibaba and then Meituan targeted by the regulator. Over 30 other tech companies have also been asked to undergo “self-rectification”, including the ride-hailing company Didi Chuxing. Yuan Yang reports the wave of antitrust activity has come partly in response to public anger over the enormous power of some tech companies.

Line chart of  showing Alibaba

3. UK’s Channel 4 set to be privatisedThe UK’s fourth public channel will be steered towards privatisation by the government as soon as next year. Our media team looks at the future for the 38-year old broadcaster, while Lex says its streaming service may be of most appeal to investors.

4. Person in the News — Lina KhanLina Khan’s critique of corporate power began with Big Candy and is now focused on Big Tech. Her appointment as chair of the Federal Trade Commission this week has sent shockwaves through Washington, Wall Street and Silicon Valley. James Politi has a profile of the 32-year-old.

5. Living in a subscription economyAlongside the familiar bills for utilities, internet, mobile phone and mortgage, Tim Harford’s household subscriptions include “services as varied as an online yoga resource, access to all the Star Wars and Marvel movies, a Patreon campaign, wine, Amazon Prime, Microsoft Office, Adobe Photoshop, apps for mindfulness, language learning and productivity, two cloud storage services, unfettered access to BoardgameArena and a music bot on Discord”. He’s worried about how we lose track of our spending in a cashless society.

Nebia, the water-saving showerhead company backed by Apple’s Tim Cook and former Google chief Eric Schmidt, announced a more affordable version this week. The Quattro offers four spray modes for the first time, including two high-pressure ones in addition to its popular Nebia spa spray. It’s available as either a fixed Rainshower or Handshower version, made with recycled ocean plastic, and comes in a range of colours and finishes. The price has been coming down from $499 originally to $199 with last year’s model and the new version starts at $99 on Kickstarter and $129 at retail. Cnet took a soak with it.