Data and news in this article are current as of December 2, 2025. This is informational, not investment advice.
Adobe stock today: price, performance and valuation
Adobe Inc. (NASDAQ: ADBE) is trading near the bottom of its 52‑week range despite solid earnings and aggressive moves in generative AI.
- Latest price: around $325 per share intraday on December 2, 2025.
- Market cap: about $136 billion.
- 52‑week range: roughly $312–$558. [1]
According to StockAnalysis, Adobe’s trailing twelve‑month (TTM) numbers look robust:
- Revenue (TTM): $23.18 billion
- Net income (TTM): $6.96 billion
- EPS (TTM): $16.05
- P/E (TTM): ~20.2×
- Forward P/E: ~14.3× [2]
Simply Wall St estimates Adobe’s current free cash flow at about $9.5 billion, implying a free‑cash‑flow yield of roughly 7% at today’s valuation. [3]
Yet the share price has de‑rated sharply:
- The stock is down about 27% year‑to‑date and roughly 38% over the past 12 months, according to Simply Wall St and other analyst round‑ups. [4]
In other words, investors are treating Adobe more like a mature, slower‑growth software name just as the company is betting big on AI.
Q3 FY2025: earnings beat, guidance raised and AI ARR milestones
Adobe’s most recent reported quarter is Q3 FY2025 (quarter ended August 29). The numbers were strong across the board:
- Revenue: $5.99 billion, up about 10–11% year over year, and ahead of expectations.
- Non‑GAAP EPS:$5.31, beating consensus of $5.18. [5]
- Digital Media revenue: $4.46 billion, up roughly 11–12%.
- Digital Experience revenue: about $1.48 billion, up around 9%. [6]
Two AI‑related metrics jumped out:
- AI‑influenced ARR (annualized recurring revenue that involves AI capabilities) surpassed $5 billion.
- “AI‑first” ARR, tied directly to AI‑native products and features, already exceeded Adobe’s prior $250 million year‑end target. [7]
Management raised full‑year guidance:
- FY2025 revenue: guided to about $23.65–$23.70 billion.
- Q4 FY2025 revenue: forecast at $6.075–$6.125 billion. [8]
Investing.com’s summary of the quarter noted that the CEO called AI the company’s “biggest opportunity in decades,” while the CFO highlighted rising demand for AI‑integrated solutions. [9]
Despite that, the market reaction has been muted to negative in the weeks since, as investors debate how much of this AI momentum will actually flow through to faster growth and higher margins.
Generative AI roadmap: Firefly, Firefly Foundry and AI assistants
At Adobe MAX 2025 in October, Adobe doubled down on its AI narrative with a wave of announcements. [10]
Key pieces of the roadmap:
Firefly and Firefly Foundry
- Adobe Firefly has evolved into an “all‑in‑one creative AI studio,” offering generative tools for images, video, audio, vectors and 3D.
- The new Firefly Image Model 5 (in public beta) focuses on higher resolution, better photorealism and prompt‑based editing.
- Firefly Creative Production (private beta) lets teams batch‑edit thousands of images at once—replacing backgrounds, applying consistent color grades and more. [11]
For enterprises, the big news was Adobe Firefly Foundry:
- Lets businesses work directly with Adobe to build private, brand‑specific generative AI models, trained on their own IP but anchored on Adobe’s commercially safe Firefly base models.
- Supports all major asset types (image, video, audio, vector, 3D) to accelerate on‑brand content production. [12]
This is a clear attempt to put Adobe at the center of enterprise‑grade creative AI—safe data, IP‑aware models, and deep integration with tools marketers already use.
AI assistants across Creative Cloud and Express
Adobe also unveiled AI assistants embedded across apps like Photoshop, Firefly and Adobe Express:
- Users can describe what they want in natural language (“make this look like a cinematic night scene”) and then refine with the usual pro controls.
- Adobe is also integrating partner models from Google, OpenAI, Runway, ElevenLabs, Topaz Labs and others, giving creators a curated selection of third‑party AI inside Adobe’s tools. [13]
For investors, the question is not whether Adobe is “doing AI”—it clearly is—but whether these features will drive upsell, higher ARPU, and stickier enterprise deals.
Strategic deals: $1.9B Semrush acquisition and HUMAIN partnership
Semrush: betting on “generative engine optimization”
On November 19, Adobe announced a deal to acquire Semrush, a major SEO and brand visibility platform, for $12 per share in cash, valuing the company at roughly $1.9 billion. The deal is expected to close in the first half of 2026, pending regulatory approvals. TechStock²
Strategic rationale:
- Combine Semrush’s search and brand visibility data with Adobe Experience Cloud and Adobe Analytics.
- Help marketers understand their visibility across classic search, owned media and new AI‑driven discovery channels (for example, being recommended inside chatbots and AI agents, not just on Google’s results page).
- Adobe has highlighted that traffic from AI sources to U.S. retail sites has surged — one Adobe report cited around 1,200% year‑on‑year growth in generative AI referrals in October, underlining why “generative engine optimization” is emerging as a new discipline. [14]
The TS2.tech breakdown notes that the deal introduces integration risk and invites scrutiny over capital allocation (some investors would prefer more buybacks), but also potentially creates a powerful GEO+SEO stack if Adobe executes well. TechStock²
HUMAIN partnership: AI infrastructure for media and sports
Adobe has also announced a “first‑of‑its‑kind” partnership with HUMAIN, combining Adobe Firefly with HUMAIN’s cloud and real‑time rendering technology, targeting broadcasters, sports leagues and other media producers that need GPU‑heavy AI infrastructure. [15]
The idea: pair Adobe’s AI content tools with HUMAIN’s hardware and orchestration to offer end‑to‑end solutions for high‑end live and on‑demand production—another way of deepening Adobe’s relevance in AI‑powered media workflows.
Creator ecosystem: YouTube Shorts and mobile video
TS2.tech also highlights a YouTube Shorts partnership: a new “Create for YouTube Shorts” hub inside Adobe’s Premiere mobile app. That integration aims to:
- Bring Premiere‑grade editing to millions of Shorts creators.
- Offer templates and one‑tap publishing to YouTube Shorts from within Adobe’s ecosystem. TechStock²
This is about capturing younger, mobile‑first creators early and keeping them inside Adobe’s universe as their needs become more professional.
Adobe Analytics: record holiday shopping and an AI‑powered consumer
Beyond creative tools, Adobe’s analytics data is front and center in 2025 holiday‑shopping coverage, which indirectly reinforces the importance of its Digital Experience business.
From Adobe’s own 2025 Holiday Shopping Report:
- Adobe forecasts a record $253.4 billion in U.S. online holiday spending (Nov 1–Dec 31), up 5.3% year over year.
- Mobile is expected to account for about 56.1% of online revenue, with around 70% of retail visits coming from mobile devices.
- “Buy now, pay later” (BNPL) volume is forecast at $20.2 billion, up 11% from last year. [16]
Fresh data during Cyber Week backs up those bullish forecasts:
- Reuters reports that U.S. consumers spent $44.2 billion online over the five days from Thanksgiving through Cyber Monday, up about 7.7% from 2024. Cyber Monday alone hit $14.25 billion in sales. [17]
- Adobe Analytics also estimated $9.1 billion in U.S. Cyber Monday online sales by early evening on December 1, projecting a full‑day total of $13.9–$14.2 billion. [18]
- In the U.K., Adobe Analytics data shows online spending of £3.8 billion (~$5.0 billion) from Black Friday through Cyber Monday, up 4.6% year on year. [19]
CoinCentral notes that Adobe expects AI‑assisted shopping traffic to jump by 520% this holiday season as consumers rely more on generative AI tools for recommendations and deals. [20]
For Adobe shareholders, this matters because:
- It underscores the relevance of Adobe Analytics and the broader Experience Cloud as retailers lean on data and personalization.
- It provides a real‑world proof point that AI‑driven discovery is reshaping ecommerce — a trend Adobe is trying to monetize with both its analytics and the Semrush acquisition.
What Wall Street is saying: targets, upside and downgrades
Analyst opinion on Adobe is divided but generally positive on value, especially after the share‑price slide.
Consensus targets and ratings
Different aggregators show slightly different snapshots, but all see meaningful upside:
- MarketBeat: consensus rating “Hold” from 29 analysts (3 Sell, 11 Hold, 14 Buy, 1 Strong Buy) with an average 12‑month target of $428.96, about 32% upside from the current price. [21]
- StockAnalysis: 23 analysts, consensus “Buy” with an average target of $456.52, implying roughly 40–41% upside. [22]
- TipRanks: consensus “Moderate Buy” and an average target near $468.48, suggesting about 46% upside. [23]
- Zacks and other forecast tools cluster in a similar range, with average targets mid‑$450s to high‑$460s and some high‑end targets at $590–$660 per share. [24]
In short, analysts broadly agree Adobe is undervalued versus their models, but disagree on how fast AI and new products will translate into growth.
Fresh valuation take: Simply Wall St
A December 2 Simply Wall St note explicitly asks whether Adobe is a bargain after a 26.8% YTD drop:
- Their discounted cash flow (DCF) model estimates fair value at $530.57 per share.
- At current prices, that implies the stock is about 39.2% undervalued.
- They calculate Adobe’s P/E at about 19.4×, versus a sector average near 31.8×, and a “fair” P/E closer to 35.5×, suggesting Adobe trades at a discount to peers despite its scale and margins. [25]
Bulls vs. bears on AI and competition
On the bullish side:
- Morningstar recently dubbed Adobe an “underdog AI stock” with roughly 70% upside, arguing the market is underestimating the company’s wide moat built on high switching costs for creatives and enterprises. TechStock²+1
- A Yahoo Finance opinion piece published today calls Adobe one of the more attractive AI “bargains,” noting that the company felt threatened enough by Figma to attempt a $20 billion takeover and still retains enormous embedded power in creative workflows. [26]
On the bearish side:
- A widely cited Barron’s piece summarized a downgrade from Melius Research, where the analyst cut Adobe to Sell with a $310 price target, warning that “AI is eating software”—and that players like Microsoft, Oracle and new AI‑native tools could erode Adobe’s pricing power. [27]
- Reuters’ Breakingviews column last week framed Adobe CEO Shantanu Narayen as facing a “new Harvard exam”: after successfully shifting the company to subscriptions, he must now prove Adobe can be an AI‑first winner while relying in part on third‑party AI infrastructure and facing rivals such as Autodesk. [28]
Institutional tug‑of‑war: who’s buying Adobe now?
December 2 filings highlight how split big money is on ADBE:
- Quantbot Technologies LP boosted its position by more than 28,000% in Q2, buying an additional 43,374 shares to own 43,528 shares worth about $16.8 million. [29]
- Westerkirk Capital Inc. opened a new Adobe stake, purchasing 16,943 shares worth roughly $6.56 million, making ADBE its 25th‑largest holding. [30]
- M&T Bank Corp trimmed its holdings by 8.8%, selling 11,653 shares but still owning more than 121,000 shares valued around $46.9 million. [31]
Across the shareholder base, about 81.8% of Adobe’s stock is held by institutions and hedge funds, according to MarketBeat. [32]
That mix tells a clear story: some sophisticated investors are cashing in or de‑risking after years of outperformance, while others are using the selloff to build sizable new positions.
Is Adobe stock undervalued after a 27% slide?
Putting the pieces together:
- Fundamentals: high‑30% to 40% operating margins, ~30% net margin and strong free cash flow generation. [33]
- Valuation: ~20× trailing earnings, ~14× forward earnings, ~5.9× sales and ~7% FCF yield — cheaper than many large software peers with comparable growth. [34]
- Analyst upside: most price targets cluster 30–45% above today’s level, with a few aggressive calls in the $590–$660 range. [35]
- Narrative pressure: competitive headlines (Figma’s blockbuster IPO, Canva’s $42B valuation) and AI anxiety have pushed investors to re‑rate many software names lower. [36]
Simply Wall St’s DCF view (roughly 40% undervalued) and Morningstar’s “70% upside” thesis represent the more optimistic end of the spectrum. [37]
But even more cautious aggregators like MarketBeat and StockAnalysis still see low‑to‑mid‑40% upside if Adobe simply hits consensus estimates over the next 12 months. [38]
The core bull case:
- Adobe sits at the heart of global content creation (Photoshop, Premiere, Acrobat, Creative Cloud).
- AI features (Firefly, Foundry, AI assistants) deepen the moat and expand the addressable market.
- Analytics and marketing tools are plugged into structural growth in ecommerce and AI‑driven discovery.
- The stock’s multiple has compressed to levels that look modest versus its history and peers.
Key risks to watch
Despite apparent value, several risks are front‑of‑mind for investors and analysts:
- AI monetization risk
- If upcoming earnings don’t show AI driving incremental revenue and margin expansion (not just user engagement), the market may keep Adobe in the “prove‑it” penalty box. TechStock²+1
- Competitive pressure (Figma, Canva and AI‑native tools)
- Figma’s IPO and subsequent rally (valuing it around $50 billion at debut) underline how serious a rival it is in collaborative design. [39]
- Canva’s latest secondary sale valued it at $42 billion with strong growth and its own AI features. [40]
- New AI‑first tools and platforms (some free or freemium) could erode Adobe’s pricing power for casual creators, even if pros remain locked in.
- Semrush integration and M&A execution
- Adobe needs to show that combining Semrush with Experience Cloud drives cross‑sell, upsell and higher retention, not just a bigger org chart. TechStock²
- Reliance on third‑party AI infrastructure
- Breakingviews and other commentators note that Adobe depends in part on outside AI models and infrastructure, which can limit its ability to charge premium prices or fully control costs. [41]
- Macro and interest‑rate sensitivity
- As a “long‑duration” growth story, Adobe’s valuation remains sensitive to rates and broad tech sentiment. A serious risk‑off shift could pressure the stock even if fundamentals hold up.
What’s next: Q4 earnings and holiday read‑through
The next big catalyst is Adobe’s Q4 FY2025 and full‑year earnings, scheduled for December 10, 2025 (evening U.S. time), followed by an investor call. [42]
Investors will be watching for:
- Updated AI metrics: growth in AI‑influenced and AI‑first ARR, and any early revenue contribution from Firefly Foundry and AI assistants.
- Holiday ecommerce commentary: how actual spending lines up with Adobe Analytics’ record forecasts, and what that means for Experience Cloud demand. [43]
- Semrush integration roadmap: details on cross‑selling, product integration timelines and the financial impact of the $1.9B deal. TechStock²
- Updated FY2026 outlook: whether Adobe can convince the Street that mid‑teens growth and high margins are sustainable in an AI‑crowded market.
Bottom line
Adobe stock is in a strange spot on December 2, 2025:
- Fundamentally: highly profitable, cash‑rich, with growing AI‑related ARR and a central role in both creative tools and ecommerce analytics.
- Narratively: treated as a “fallen angel” of software, caught between AI hype, intense competition and investor skepticism.
- Valuation‑wise: trading at a discount to many peers, while most analyst models still bake in 30–45% upside.
Whether ADBE is a bargain or a value trap now depends on your answer to one question:
Will Adobe’s aggressive AI and analytics strategy turn into visible, accelerating growth — or will competition and pricing pressure keep it in check?
As always, anyone considering the stock should align decisions with their own risk tolerance, time horizon and portfolio needs, and consider consulting a qualified financial adviser.
References
1. stockanalysis.com, 2. stockanalysis.com, 3. simplywall.st, 4. simplywall.st, 5. www.investing.com, 6. www.investing.com, 7. www.investing.com, 8. www.investing.com, 9. www.investing.com, 10. news.adobe.com, 11. news.adobe.com, 12. news.adobe.com, 13. news.adobe.com, 14. coincentral.com, 15. www.adobe.com, 16. business.adobe.com, 17. www.reuters.com, 18. www.reuters.com, 19. www.reuters.com, 20. coincentral.com, 21. www.marketbeat.com, 22. stockanalysis.com, 23. www.tipranks.com, 24. www.tipranks.com, 25. simplywall.st, 26. finance.yahoo.com, 27. www.barrons.com, 28. www.reuters.com, 29. www.marketbeat.com, 30. www.marketbeat.com, 31. www.marketbeat.com, 32. www.marketbeat.com, 33. stockanalysis.com, 34. stockanalysis.com, 35. www.marketbeat.com, 36. www.reuters.com, 37. simplywall.st, 38. stockanalysis.com, 39. www.reuters.com, 40. www.ft.com, 41. www.reuters.com, 42. stockanalysis.com, 43. business.adobe.com
