Overview

• Adobe reported record fourth-quarter revenue of $5.61 billion and adjusted earnings of $4.81 per share, surpassing Wall Street expectations.
• The company issued a revenue forecast of $23.3-$23.5 billion for fiscal year 2025, falling short of analysts' projections of $23.8 billion.
• Shares fell sharply, erasing $29.8 billion in market capitalization, marking Adobe's largest single-day drop in nine months.
• Investors remain skeptical about Adobe's ability to translate its AI investments, including its Firefly generative AI tools, into significant revenue growth amidst rising competition from AI startups.
• Analysts suggest Adobe's conservative guidance reflects uncertainties around AI adoption rates and a cautious approach to pricing new AI-driven features.