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Adobe Crushes Q4 Expectations as AI Tools Drive Growth

MarketDash Editorial Team
4 hours ago
Adobe delivered a strong fourth quarter performance, topping Wall Street estimates on both earnings and revenue as the company's AI-powered tools continue to gain traction with customers across its business segments.

Adobe Inc. (ADBE) held steady in after-hours trading Wednesday following a fourth quarter earnings report that showed the company continuing to capitalize on the AI boom. When a software giant like Adobe threads the needle between meeting expectations and delivering growth, investors tend to take notice.

The Numbers

Adobe reported earnings of $5.50 per share, comfortably beating the analyst consensus of $5.39. Revenue came in at $6.19 billion for the quarter, surpassing the Street estimate of $6.11 billion and marking a healthy jump from $5.61 billion in the same period last year.

But the real story lives in the segment breakdowns, where Adobe's various business units showed consistent momentum across the board.

Segment Performance

The Digital Media segment delivered $4.62 billion in revenue, representing 11% year-over-year growth both as reported and in constant currency. This is Adobe's bread and butter—think Creative Cloud and the tools designers and creators rely on daily.

Meanwhile, the Digital Experience segment brought in $1.52 billion, up 9% year-over-year (8% in constant currency). Digital Experience subscription revenue specifically hit $1.41 billion, growing 11% year-over-year both as reported and in constant currency.

Looking at customer categories, Total Customer Group subscription revenue reached $5.96 billion, up 12% year-over-year (11% in constant currency). Business Professionals & Consumers subscription revenue was $1.72 billion, showing 15% growth year-over-year (14% in constant currency), while Creative & Marketing Professionals subscription revenue hit $4.25 billion, up 11% year-over-year (10% in constant currency).

The AI Angle

"Adobe's record FY2025 results reflect our growing importance in the global AI ecosystem and the rapid adoption of our AI-driven tools," said Shantanu Narayen, CEO of Adobe.

"By advancing our innovative generative and agentic platforms and expanding our customer base, we are excited to target double-digit ARR growth in FY2026," Narayen added.

That's the key takeaway here—Adobe isn't just riding the AI wave, it's positioning itself as essential infrastructure for creative and business professionals navigating this new landscape.

Looking Ahead

Adobe's outlook for fiscal 2026 shows confidence. The company expects GAAP earnings per share between $17.90 and $18.10, well above the analyst estimate of $16.56.

Adobe stock rose 0.60% to $345.18 in extended trading Wednesday.

Back to News

Adobe Crushes Q4 Expectations as AI Tools Drive Growth

MarketDash Editorial Team
4 hours ago
Adobe delivered a strong fourth quarter performance, topping Wall Street estimates on both earnings and revenue as the company's AI-powered tools continue to gain traction with customers across its business segments.

Adobe Inc. (ADBE) held steady in after-hours trading Wednesday following a fourth quarter earnings report that showed the company continuing to capitalize on the AI boom. When a software giant like Adobe threads the needle between meeting expectations and delivering growth, investors tend to take notice.

The Numbers

Adobe reported earnings of $5.50 per share, comfortably beating the analyst consensus of $5.39. Revenue came in at $6.19 billion for the quarter, surpassing the Street estimate of $6.11 billion and marking a healthy jump from $5.61 billion in the same period last year.

But the real story lives in the segment breakdowns, where Adobe's various business units showed consistent momentum across the board.

Segment Performance

The Digital Media segment delivered $4.62 billion in revenue, representing 11% year-over-year growth both as reported and in constant currency. This is Adobe's bread and butter—think Creative Cloud and the tools designers and creators rely on daily.

Meanwhile, the Digital Experience segment brought in $1.52 billion, up 9% year-over-year (8% in constant currency). Digital Experience subscription revenue specifically hit $1.41 billion, growing 11% year-over-year both as reported and in constant currency.

Looking at customer categories, Total Customer Group subscription revenue reached $5.96 billion, up 12% year-over-year (11% in constant currency). Business Professionals & Consumers subscription revenue was $1.72 billion, showing 15% growth year-over-year (14% in constant currency), while Creative & Marketing Professionals subscription revenue hit $4.25 billion, up 11% year-over-year (10% in constant currency).

The AI Angle

"Adobe's record FY2025 results reflect our growing importance in the global AI ecosystem and the rapid adoption of our AI-driven tools," said Shantanu Narayen, CEO of Adobe.

"By advancing our innovative generative and agentic platforms and expanding our customer base, we are excited to target double-digit ARR growth in FY2026," Narayen added.

That's the key takeaway here—Adobe isn't just riding the AI wave, it's positioning itself as essential infrastructure for creative and business professionals navigating this new landscape.

Looking Ahead

Adobe's outlook for fiscal 2026 shows confidence. The company expects GAAP earnings per share between $17.90 and $18.10, well above the analyst estimate of $16.56.

Adobe stock rose 0.60% to $345.18 in extended trading Wednesday.