Happy friday to you. A couple of days now from apples big event. The company is expected to launch a new smaller iphone and ipad. John forte is going to be there. Many of apples top engineers may quit rather than help the fbi if it wins the case against apple. If youre looking for them to stick around and help write this code, they said good luck with that. Is that true . Yeah. Oh yeah. I dont think theyll do it. This isnt north korea. They dont have to build things that they dont want to build so these people have lots of job offers elsewhere and i think probably apple backs them in this. If they don want to build it, they wont build it. Even actually theyll get someone to build it. And maybe some of them agree with the government and will do it. But i think youre not going to make them do it. The problem is these are the people that build the operating Southern Land and if they quit who is going to build ios 10 or io s11 . Its a bit of an operating challenge at the same time. What this does push is push the govern. At least in a tactical way, a strategic way to say are you going to ask for the source code . Because if you ask for the source code, that to me is Going Nuclear on silicon valley. And its coupled with the engineers that dont agree with it arent going to build it. You cant be forced to make software that you dont believe in. It will be an interesting faceoff. When we think about the interview with Time Magazine and whatever the law is he did say that whatever release for future software we have to go up in a security sense. They have to heighten the security. What will we see on monday from a security perspective. They have a lot of press there. I dont think theyll announce Something Big to slap it in the face, the government even more security now with even 10 more or whatever but i cant imagine he wont address the issue from the stage given that he has a worldwide audience there. He has been very outspoken. Hes not someone that goes out a lot. Hes been on the cover of time and nbc and all over the place and giving clear and strong quotes about this issue. So i expect him to address it there. I would be surprised if he didnt. The date to watch is a summer day, wwdc. Thats the worldwide developer conference. We see the new version of ios there. If youre going to build in new security features and talk about your rational behind that, thats the stage on which to do it. If youre going to build in new capabilities for developers to even build more security into their apps thats a place to do. So i expect this issue to really come to a head in the summer. His language has been unmistakable. Calling it a crock and Everything Else he said, kara, was this times piece today feel to you like it was applefed . Is this their way of going around . No, theyre not going around. I think they have been active. They have been actively talking about this. He has been everywhere. Hes not backing down on this and its probably inspiring some of his engineers and things like that. All right. Well, obviously he has learned a lot more on monday. Hopefully at least from a product standpoint. And its him jogging. People started arguing about the air pollution in china. His ability to access facebook despite the crack down. Tasting in pictures of forest gump with him. What do you make of this kara . Is it much to do about nothing . Hes not shy agoway from that idea. Anything he does is going to attract attention. I was just in beijing and the pollution is very serious and he may have been a little bit tone deaf in this issue. Plus he was running through an area with all sorts of political considerations. So i mean anything he does is going to attract attention and maybe he shouldnt be he looks like he is cooperating with the government. I think that was most of the criticism about that. I doubt thats what he men at all. You say this is tone deaf but wouldnt it be more tone deaf to be running with a face mask or making a grimace in an otherwise inappropriate setting or should he have just not have posted it at all . Probably the last one. If he did witt the face mask he would have angered the government. It looks like hes saying theres no air pollution and i have never seen anything like it there and the government is failing on every measure to control this very serious problem there and so it looks like he is sort of accepting it i guess. I dont know, everything in china matters. Every photo does. And my first reaction was exactly that, oh my gosh. Hes jogging. You can see the smog in the background. He is smiling. And they posted it from the u. S. ; hes jogging in china and its being posted on book despite the fact that its not supposed to be easy to post on book from china. Its in a way subversive without having subversive. Its being more open than youre supposed to be when youre jogging through china. Theres a couple of ways to look at this. I guess. I guess. Probably the sentiment that he shouldnt have posted it. Its quite difficult to get anything posted. Its a little progovernment. Theres a sense that like happily jogging through when its so full of pollution and political issues and hes mark zuckerberg. Sometimes mark done think hes as famous as he s. But hes pretty famous. Especially in china and everywhere across the globe. Always eye opening to post something and seconds later just watch it disappear prof your eyes on your phone. Finally, kara, jack dorsey talking about the 10 Year Anniversary and the biggest change in twitter over the past decade. Just how people use the service. It is the easiest way to see whats happening in the world right now live. A lot of people use it to see whats breaking and whats new in the world. It comes a day after he talks to kelly evans in San Francisco about twitter and square. Kara, how might twitter benefit from doing more Broader Media . Thats not a bad idea to get out there and do those things. They have bigger issues than that. You have been hearing the private equity rumors. Stock continues to be weak. Advertisers are trying to figure it out. He should go out and try to put out twitter anywhere he can and the today show is a consumer focused broader audience and theres nothing wrong with that, to do that. Its a good idea. He was asked very clearly cara if he would be on the today show for twitters 15th birthday talking about the company and he said well be here on the 20th birthday. Its 30th birthday. Its a fundamental service. But the question is whether other services are becoming more fundamental to us as users. What do you think . Im not sure what else he is going to say. No, no, ill be sold by then. Sure, today show people. No, i think youre right. Snapchat, for example, i continue to be amazed by the features they keep adding there and how innovative that service is. And theres all kinds of different ways to communicate. Its a very niche product for a lot of people. Can they grow it . Can they get it out . Can they get advertisers . Its a great delivery vehicle for news but its not the only one and i dont think they can base a business on that. Even though its a great utility. I love it. I love to use it. You do. Your million followers like hearing from you. Finally, cara, we talked to you all through the First Quarter and in through february when valuations took a hit we asked you the temperature out in the valley at the time. Your answer was Something Like eight lous some players to play in the sand box where they were excluded because of valuation before. What do we make now that the indices are back above the break even mark for the year . Theres still a very big worry about valuations. Everybody is sort of quitely ive been having a lot of lunching with private he equity people and there is still making cuts in cost. Theres been a lot of lay offs. I still think theres nervousness. This election has thrown everybody into a wait and see period. You know, thats not to say theres not some incredibly valuable companies. I just think people are still wary. Its not the way it had been. Thats an important insight to get. Great weekend. Thanks again. Meanwhile, we looking at a triple digit rally for the dow up 117 points this morning. Dow solidly positive for 2016. The s p back in positive territory. The banks are the best sector today despite still being negative on the year. The nasdaq is down 4. 5 for the year but its also positive today. Shares of tiffany in the green after earnings in revenue beatestments. The retailer saying it expects Earnings Growth to resume in the second half of the year. Its not expected to post a profit but they expect the tide to turn perhaps after mothers day. When we come back this morning, shares of adobe not waiting until mothers day to see a record high. Nice gain. Ceo is going to join us in a cnbc exclusive. In about 20 minutes well get a lot more information. Well get you the latest on that and then google putting boston dynamics, the Company Famous for the crazy robot videos up for sale. Why and who might be interested . In a moment. Theres a lot of places you never want to see 7. 95. [ beep ] but youll be glad to see it here. Fidelity where smarter investors will always be. If only the signs were as obvious when you trade. Fidelitys active trader pro can help you find smarter entry and exit points and can help protect your potential profits. Fidelity where smarter investors will always be. He is the ceo of adobe and joins us exclusively from san jose. Always great to have you. Happy friday. Congratulations on the quarter. Thanks for having me. Always a pleasure to be on your show. I want to dive right in to the guidance because that was one of the positives certainly from the call. You raised the Digital MediaRevenue Target from 3. 875 billion to 4 billion. At the beginning of the year everybody was cautious based on a number of mixed signals in the market. What exactly gave you and your team that confidence to raise that arr target . Is it the what you have seen so far in the quarter . Is it just some overall trend either domestically or internationally . Big picture we anticipated how technology would be used to reimagine the entire creative process. Whether youre editing videos or creating mobile applications or trying to personalize websites its clear that Creative Cloud is now the one stop shop from everything for inspiration all the way out to monetization. Were seeing more and more adoption not just by existing customers migrating and also we con to attract new customers. 30 of the folks who are on Creative Cloud are doing business with adobe for the first time and as we always stated International Markets were behind and now were catching up with International Expansion also taking stocks. We feel good. Were continuing to innovate and as long as i think we continue to focus on the customer it feels like it is the right product for them. At the same time youre moving from talking more about subscriber growth just those raw numbers of people and waited toward giving people more services and things to buy and revenue advantages and percentage growth on subscribers . Were focused on both. We stated that we think that tens of millions of new customers who we can attract but as we diversify what he we have theyre who we try to target and theyre subscribing to the entire Creative Cloud but as we have new offerings such as the education offering that we introduced where we want entire k through 12 institutions to standardize on the Creative Cloud, for the Creative CloudPhotography Program which is attracting millions of new customers, the annualized me trick is better for people to understand the true health of the business an a mobile only offering is something that were considering to attract new customers and it encompasses all of the differ financial me trix when we talk about enterprise adoption which continues to grow. Thats also reflected in arr. So as you know we have been talking about for a few quarters how arr is the Better Health of the business and we want investors to focus on that. Were in this era of treatmenting and scripted content and mushrooming of content on digital. Im wondering how much of that is feeding the cloud. What customers are coming to you that werent around 5 or 10 years ago. Video is a big growth opportunity. Youre right. When you think about how the next generation of consumers are consuming video. Whether its ncaa march madness or whats happening with sun dance or whats happening with the olympics. Its clear that people are consuming all of that video on mobile devices an so movies are done digitally. When people want to share a creation theyre using it to do that. Its been a huge area of growth and we continue to think that with primetime which is our product there, that will continue to drive further adoption. The truth is that most consumers right now want to consume the video at the right time whenever they want and so Technology Enables them to do that. We heard you talking about mobile as a gateway to a i. D. And people transitioning into a higher value adobe services. Is that at least in the near term and medium term the extent of mobile modernization . The onramp and expansion of value for people already subscribed to want to do a little work on mobile . Or is there more to come . Well, mobile is a tail wind from two very differ perspectives. Youre right on the creative side as we introduced new mobile applications as well as light room mobile we find that people are first experiencing the joys of how to create things by downloading our creative mobile applications and then find that as they juan to extend that creativity the desktop applications are best of breed and we had Something Like 20 million new i. D. S created by people first interacting with us on mobile. Thats certainly one tail wind. The other tail wind for us on mobile is as you know, with the Digital Marketing business as people are completely transitioning their business to be a Digital First experience for their customers mobile is where people are interacting whether its for commerce or financial der viss or interacting with government and what we said in the portel is that 49 of the transactions that were seeing that were delivering through our Digital Marketing products are now also happening on mobile. So mobile is driving more consumption of content and thats playing into our Digital Media and Digital Marketing trends. Now, quickly, i have to ask you while we got you, do you feel like youre swimming upstream here . Are you doing well despite the global macro environment or have people at the start of this year been a little bit too negative on the overall Growth Prospects for tech and software in 2016 . I think john, for us, what we have done really well as a company is we have anticipated how technology can both enable us to reimagine a business that was very successful for us which was the Digital Media business but i think more important create a brand new category which is Digital Marketing and when you talk about whats happening with digital disruption, i think irrespective of whats happening on the macroeconomic situation, every company whether its government institution, educational institution, Financial Services has to reimagine their entire Customer Journey and its a Digital First journey and i think the fact that theyre all investing in that technology and were the leader i think is providing momentum in our business. You threaded the needle there on the shots. Thank you for joining us. Ceo of adobe with the stock up 5. 5 near all time highs, kayla. All right. Up next, videos like these from boston dynamics have been a huge hit on the internet. We have shown them. We watched them. We laughed we cried and now google is putting the robot maker up for sale. Well tell you why and who might be interested in just a moment. Owen hey kevin. Hey, fancy seeing you here. Uh, i live right over there actually. Youve been to my place. No, i wasnt. Oh look, you dropped something. Its your resume with a 20 dollar bill taped to it. Thats weird. You want to work for ge too. Hahaha, what . Well were always looking for developers who are up for big world changing challenges like making planes, trains and hospitals run better. Why dont you check your new watch and tell me what time i should be there. Oh, i dont hire people. Im a developer. Im gonna need monday off. Again, not my call. And that a tired dog is a good dog. [ dog barking, crashing ] so when you need a dog walker or a handyman, we can help you get the job done right, guaranteed. Get started today at angies list. Google is putting boston dynamics up for sale. The robots Opening Doors and stumbling through the woods a little bit but executives think the company isnt likely to produce a marketable product in the next few years. Rumored buyers for boston dynamics include amazon and a Research Division of toyota. Google acquired the company in 2013 for an undisclosed price and john lest we think that all of these moon shots that google is investing in are not working toward a commercially viable product maybe thats what theyre trying to say. Its a bit of a head scratching. Since when is being able to produce a commercially viable product. I wonder if this is ruth at work, this financial discipline of the new cfo coming in and say as good this a moon shot or a low earth satellite. How much would we really get out of this in several years even if it were to be successful . Thats not what it is. Like bargaining on that front, right . Its supposed to be aspiratio l aspirational. You would think. Either these videos freaked them out, right . The more they thought about them freaks me out a little bit. Maybe they thought suppose this isnt as big a deal as