"It includes competition from traditional rivals, emerging AI players, large language model developers, and a prevailing market narrative that will be difficult to overcome, adds the analyst. The analyst says that their second-half fiscal 2025 CIO survey signals headwinds for Adobe, with front-office segments, including digital marketing, losing priority over the next 12 months. Notably, sales and marketing budgets show a 16-point net decrease, and 13% of respondents expect reduced focus on front-office applications."
"Keybanc analyst Jackson Ader downgraded Adobe from Sector Weight to Underweight and announced a $310 price forecast. Overall, Ader says that they appreciate Adobe's share buyback program and recognize its financial profile as one of the strongest in the industry. Despite the downgrade, the analyst says that FY1 Revenue projection remains at $25.997 billion with an expected growth rate of 9.4%, and the FY2 Revenue is forecast to be $28.377 billion, growing at 9.2%."
Adobe faces tighter marketing budgets and shifting enterprise priorities that weaken growth outlook into 2026. Competition from traditional rivals, AI players, and large language model developers increases pressure. A second-half fiscal 2025 CIO survey shows front-office segments, including digital marketing, losing priority; sales and marketing budgets show a 16-point net decrease, and 13% of respondents expect reduced focus on front-office applications. Share buybacks and a strong financial profile support stability, but limited opportunities suggest potential underperformance in 2026. FY1 revenue projected at $25.997B (9.4% growth); FY2 at $28.377B (9.2% growth). Quarterly EPS $5.50 and revenue $6.19B; fiscal 2026 GAAP EPS guidance $17.90–$18.10; shares down 1.78%.
Read at Benzinga
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