Adobe Beats Estimates but Soft Outlook Weighs on Stock

Adobe beat Wall Street estimates for third-quarter revenue and profit on Thursday, but a softer-than-expected fourth-quarter outlook and a looming leadership transition kept pressure on the software maker's shares. The San Jose, California-based company reported quarterly revenue of $6.76 billion, slightly above the analyst average estimate of $6.70 billion, according to LSEG data. Adjusted earnings came in at $6.13 per share, compared with expectations of $6.09. Despite the beat, shares fell in trading on Thursday and were down about 2.5 percent in premarket trading on Friday. The stock has fallen roughly 25 percent this year. Adobe has been adding artificial intelligence features across its creative and customer-experience software as it defends its market position against newer AI-powered rivals such as Figma and Canva. The company said annual recurring revenue from its AI-first products grew more than 150 percent year over year in the quarter, and that its broader creativity and productivity products now have more than 1 billion monthly active users.