Overview
- Adobe reported record third-quarter fiscal 2026 revenue of $6.76 billion and non-GAAP earnings per share of $6.13.
- The company said its freemium and AI-first strategy lifted creative freemium users past 100 million, total monthly active users above 1 billion, and AI-first ARR to over $650 million.
- Net new annual recurring revenue fell roughly 36–38% year over year, and remaining performance obligations grew just 8%, showing a marked slowdown in near-term bookings.
- Management says the ARR drop reflects a deliberate move to expand free AI tiers, and the firm guided Q4 revenue to $6.80–$6.85 billion as the key test of whether users convert to paid plans.
- A leadership change with Anil Chakravarthy becoming CEO on Dec. 1 adds an execution angle to the pivot, and analysts remain split on whether monetization will recover fast enough to restore investor confidence.