Adobe Shares Plummet 9% After Weak Q4 Guidance Despite Strong Q3 Results

Analysts remain optimistic about Adobe's long-term prospects, citing AI advancements and subscription growth.

Adobe's stock fell 9% following a disappointing fourth-quarter revenue and earnings forecast.
Despite the weak outlook, Adobe reported record third-quarter revenue of $5.41 billion and earnings per share of $4.65, both beating analyst estimates.
Analysts suggest Adobe's projections may be conservative and anticipate significant future gains from AI technologies, particularly the Firefly generative AI models.
Adobe's Digital Media segment, including Creative Cloud subscriptions, posted record net-new annualized recurring revenue but fell short of Q4 guidance expectations.
Nearly 75% of analysts tracking Adobe maintain a 'buy' rating, with an average price target implying over 15% upside from the current share price.