+ Annual Incentive Plan + New hire equity award
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Adobe offers software for creating and managing digital content across media, organized into Creative Cloud, Marketing Cloud, and Document Cloud. Its products run on desktop and mobile apps that sync with cloud services, letting users create, edit, share, and optimize content across devices. Adobe differentiates itself with a broad, integrated ecosystem that covers design, marketing workflows, and document management, backed by a large user base and scalable enterprise solutions. Its goal is to help people and organizations produce and improve digital content at scale.
Company Size
10,001+
Company Stage
IPO
Headquarters
San Jose, California
Founded
1994
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Adobe shares trade at $235.47 after falling 33% over the past year, whilst the S&P 500 rose 17%. The creative software maker reported third-quarter revenue up 12.9% to $6.76 billion and non-GAAP earnings per share of $6.13, its fifth consecutive beat. Despite raising full-year guidance to $24.45-$24.50 per share and AI-first annual recurring revenue topping $650 million with growth exceeding 150%, investors remain cautious. Concerns centre on new chief executive Anil Chakravarthy's transition, generative AI competition, and whether 100 million freemium users will convert to paid subscriptions. The stock trades at nine times forward earnings with a price-to-earnings-growth ratio of 0.58. Analysts' average price target of $278 suggests 18% upside potential.
Adobe stock has fallen roughly 34% from its 52-week high to about $241, despite posting record quarterly revenue throughout the fiscal year. An analyst predicts shares will climb back above $350 before 2030, representing a potential 45% rise. The forecast hinges on Adobe maintaining its current trajectory: growing annualised recurring revenue at double-digit rates, holding its operating margin steady at around 45%, and continuing share buybacks. Total annualised recurring revenue reached $27.5 billion in the third quarter, up 11.2% year over year. Adobe recently lifted its fiscal 2026 targets to approximately $26.6 billion in revenue and adjusted earnings per share between $24.45 and $24.50, up roughly 17% from the previous year. The company has $24.55 billion remaining in its buyback authorisation through April 2030. The main risk is potential slowdown in recurring revenue growth if AI tools from newer competitors erode Adobe's market position.
Adobe has launched its Premiere video-editing app for Android, nearly a year after its iPhone debut. The app, which replaces Premiere Rush (ending support 30 September), has been optimised for various Android devices, including Samsung foldables and Google Pixels. Senior vice president Eric Snowden says the iOS version received "incredibly positive" feedback, earning 4.8 stars from over 25,000 App Store ratings. The Android version works on devices with at least 5GB RAM running Android 13 or later. Features include access to camera roll footage, creator-made templates, and options for basic or advanced editing with multitrack timelines. Adobe's apps, including Acrobat, Photoshop, and Lightroom, are also optimised for Google's new Chromebook platform, though they won't match desktop-grade performance on Windows or macOS.
Adobe reported third-quarter fiscal 2026 revenue of $6.76 billion, up 13% and beating the $6.70 billion analyst estimate. Non-GAAP earnings per share came in at $6.13, ahead of the $6.09 consensus. Shares fell 1.9% in extended trading after the company guided fourth-quarter revenue to $6.80 billion to $6.85 billion, slightly below expectations. The quarter coincided with a leadership transition, as Anil Chakravarthy prepares to become CEO on 1 December, with Shantanu Narayen moving to executive chair. Adobe crossed one billion monthly active users, up more than 20% year-over-year, and AI-first ARR rose over 150% to exceed $650 million. However, net new ARR fell 38% year-over-year to $390 million, raising concerns amongst analysts about monetisation of the growing user base.
Adobe stock remains down nearly 30% this year amid AI disruption concerns, despite continued solid performance. The company reported third-quarter revenue of $6.76 billion, up 13% year over year and exceeding its prior forecast. Adjusted earnings per share rose 15% to $6.13. Adobe is pursuing a freemium strategy to drive growth, offering free tools like Adobe Express and limited AI credits to convert casual users into subscribers. Monthly active freemium users grew 70% year over year, surpassing 100 million in the quarter. The company raised its full-year guidance, forecasting revenue between $26.576 billion and $26.626 billion, with adjusted earnings per share of $24.45 to $24.50. For the fiscal fourth quarter, Adobe expects revenue between $6.8 billion and $6.85 billion.