Key Stats for Adobe Stock
- Price change for Adobe stock in the last 1 year: -29%
- $ADBE Stock Price as of Sep. 10: $249
- 52-Week High: $371
- $ADBE Stock Price Target: $278
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What Happened?
Adobe (ADBE) stock dropped more than 4%, even after the company beat estimates on both revenue and profit for its fiscal Q3.
- Adobe brought in $6.76 billion in revenue, ahead of the $6.70 billion analysts expected, and grew 12% year over year in constant currency.
- Adjusted earnings came in at $6.13 per share, topping the $6.09 estimate.
- GAAP earnings per share were $4.62, up 11% from a year ago.
Both main business segments grew steadily.
Subscription revenue from Business Professionals and Consumers, which includes Acrobat and Express, hit $1.91 billion, up 15% in constant currency.
Creative and Marketing Professionals, home to Creative Cloud and Firefly, brought in $4.65 billion, up 12%.
Total ending annual recurring revenue reached $27.5 billion, growing over 11% from last year.
AI adoption is clearly picking up speed for Adobe. Annual recurring revenue tied to AI-first products more than doubled year over year, and Firefly’s ending ARR jumped 40% just from the prior quarter.
Creative freemium monthly active users crossed 100 million, up more than 70% year over year.
Despite that strength, Adobe’s guidance is what moved the stock. The company forecast Q4 revenue between $6.80 billion and $6.85 billion, with the midpoint landing just below the $6.85 billion Wall Street wanted.
That soft guide raised fresh questions about Adobe’s competitive standing, especially as rivals like Figma and Canva keep expanding their AI design tools.
Leadership changes are also in focus.
Adobe recently named Anil Chakravarthy as its next CEO, with longtime chief Shantanu Narayen shifting to executive chair on December 1.
On the earnings call, Narayen said he is confident Adobe’s best days are still ahead as it moves toward what the company calls “agentic software.”
Adobe is also working through other transitions: former CFO Dan Durn left in June to join Marvell Technology, with Steve Day stepping in as interim finance chief, and David Wadhwani, president of the Creativity and Productivity business, is set to leave on September 27.
See analysts’ growth forecasts and price targets for Adobe stock (It’s free) >>>
What the Market Is Telling Us About Adobe Stock
The market’s reaction shows investors care more about what comes next for Adobe stock than what already happened last quarter.
A revenue and earnings beat wasn’t enough to overcome guidance that fell just short of expectations.
As Emarketer analyst Grace Harmon put it, the revenue beat may ease worries that Adobe has lost its footing, but the cautious outlook still raises real questions about strategy heading into a leadership transition.
With AI-first ARR more than doubling and Firefly usage climbing fast, Adobe’s long-term AI story remains intact, but investors clearly want stronger near-term guidance before getting more confident.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
