Adobe Stock (ADBE) Jumps 5% on Buybacks and AI Optimism Ahead of Q4 Earnings

Ticker: NASDAQ: ADBE | Date: December 5, 2025
Disclaimer: This article is for informational purposes only and is not investment advice.

Key Takeaways

Adobe stock rallied about 5% today to roughly $346 per share, extending a three‑day winning streak but still trading far below its 52‑week high near $558. ^[1]
The move is driven by an aggressive share buyback program (net yield near 8%), renewed institutional interest, and anticipation of Q4 FY2025 earnings on December 10. ^[2]
Barclays cut its price target from $465 to $415 but kept an Overweight rating, arguing the stock looks undervalued based on growth and margins. ^[3]
Despite multiple recent target cuts, Wall Street’s average 12‑month price targets still imply 20–30% upside, with most analysts rating Adobe between Hold and Buy. ^[4]
Adobe is leaning heavily into generative AI (Firefly, Acrobat AI Assistant, GenStudio), which management says has already surpassed $250 million in annual recurring revenue (ARR) and is driving an upgraded 2025 outlook. ^[5]
A $1.9 billion all‑cash acquisition of Semrush, expected to close in the first half of 2026, aims to strengthen Adobe’s digital marketing and SEO capabilities. ^[6]

Adobe Stock Price Today: Strong Rebound, Still in a Downtrend

By the close on Friday, December 5, 2025, Adobe shares were trading around $346.26, up about 5.3% on the day.

According to TradingView’s market note, the rally is tied to: ^[7]

Progress on Adobe’s share repurchase program, which currently implies a net buyback yield close to 8%
The market’s focus on next week’s Q4 FY2025 earnings report
Ongoing debates about whether Adobe’s slow AI monetization is already priced in

MarketWatch data show this is Adobe’s third consecutive day of gains, though the stock still sits nearly 38% below its 52‑week high of $557.90. ^[8]

Over a longer horizon, the picture is less flattering:

The stock is down more than 26% year‑to‑date, pressured by AI competition and concerns over monetization of new tools, according to TipRanks. ^[9]
Over the past year, Adobe has dropped roughly 36%, even as the company delivered double‑digit revenue growth, per recent coverage. ^[10]

In other words: today’s bounce is meaningful, but it’s happening inside a broader 2025 downtrend.

What’s Moving Adobe Stock on December 5, 2025?

1. Buybacks Back in the Spotlight

TradingView highlights that Adobe’s accelerated share repurchases are a key driver of today’s move, with net buyback yield approaching 8%. ^[11]

Investing.com also notes that management has been “aggressively buying back shares”, while maintaining a strong financial health profile. ^[12]

For investors, this matters because:

Buybacks support earnings per share (EPS) even if revenue growth moderates.
At a depressed share price, buybacks can be more accretive.
It signals that management believes the stock is undervalued relative to fundamentals.

2. Fresh Analyst Moves: Lower Targets, Still Bullish Tilt

Several new and recent analyst notes hit the tape just ahead of the Q4 report:

Barclays
- Rating: Overweight (bullish)
- New price target:$415, down from $465 ^[13]
- Barclays expects Adobe’s total ARR to reach about $25.8 billion by FY2025, implying roughly 11.5% year‑over‑year growth, slightly ahead of prior company guidance. It also calls out a favorable PEG ratio of about 0.55, suggesting the shares may be undervalued relative to expected growth. ^[14]
Citigroup (Dec 4, 2025)
- Rating: Neutral
- Price target: cut from $400 to $366, still slightly above today’s price. ^[15]
Other recent targets (last few months) include:
- Mizuho: $390 (Buy / Outperform)
- Wells Fargo: $420 (Buy / Overweight)
- DA Davidson: $600 (Strong Buy)
- Morgan Stanley: $450 (now Equal‑Weight)
- Evercore ISI: $450 (Outperform)
- UBS: $375 ^[16]

Collectively, these updates show a more cautious tone—price targets are drifting lower—but most houses still see solid upside from current levels.

3. Institutional Buying

A new MarketBeat filing summary today shows that First Trust Advisors LP increased its Adobe stake by 32.7% in Q2, now holding about 620,376 shares, worth around $240 million at the time of the filing. ^[17]

The same report notes that roughly 81.8% of Adobe’s float is held by institutions and hedge funds, underlining that this remains a heavily owned, core tech name in professional portfolios. ^[18]

Q4 FY2025 Earnings Preview: What Wall Street Expects

Adobe will report Q4 and full‑year FY2025 results on Wednesday, December 10, 2025, at 2:00 p.m. Pacific Time. ^[19]

According to TipRanks and other forecast aggregators: ^[20]

Expected Q4 EPS: about $5.40, up roughly 12–13% year‑on‑year
Expected Q4 revenue: around $6.11 billion, implying 9%+ revenue growth
Adobe’s own guidance calls for:
- Q4 revenue:$6.08–$6.13 billion
- Q4 non‑GAAP EPS:$5.35–$5.40

After a strong Q3, Adobe raised its full‑year 2025 outlook, now targeting: ^[21]

FY2025 revenue:$23.65–$23.70 billion (up from prior $23.50–$23.60 billion)
FY2025 non‑GAAP EPS:$20.80–$20.85 (up from $20.50–$20.70)

At today’s price near $346, that implies a forward P/E in the mid‑teens, roughly 16–17x 2025 earnings, which is low compared with Adobe’s historical multiples for double‑digit growth software.

What the market really wants to see on Dec. 10:

Clear proof that AI features are driving new ARR, not just engagement
Sustained double‑digit growth in Digital Media and Digital Experience
Updated commentary on the Semrush acquisition and AI partnerships
Any new disclosure on AI‑specific ARR, which Barclays notes may not be updated this quarter. ^[22]

Fundamentals Check: Revenue Growth and AI Monetization

Q2 & Q3 2025: AI Starts To Show Up in the Numbers

Adobe’s last two reported quarters were strong on both revenue and profit:

Q2 FY2025
- Revenue: $5.87 billion, +11% year‑on‑year
- Non‑GAAP EPS: $5.06, +13% year‑on‑year
- Management raised full‑year 2025 guidance for both revenue and EPS, citing strong demand for AI‑powered tools like Firefly and updated Photoshop and Premiere features. ^[23]
Q3 FY2025 (reported September 11)
- Revenue: $5.99 billion, +11% year‑on‑year
- GAAP EPS: $4.18; non‑GAAP EPS: $5.31, +14% year‑on‑year
- Cash flow from operations: roughly $2.2 billion ^[24]

CFO Daniel Durn has said Adobe’s “AI‑first products”—including Firefly, Acrobat AI Assistant, and GenStudio—have already exceeded the company’s year‑end target of over $250 million in ARR, underscoring that AI is now a real revenue stream, not just a demo feature. ^[25]

CEO Shantanu Narayen has repeatedly described AI as a “tectonic technology shift” and “the biggest opportunity for Adobe in decades,” framing the strategy around infusing AI across every major application rather than launching separate siloed products. ^[26]

Product Momentum: Firefly, Acrobat AI Assistant, GenStudio & Mobile Video

Recent product and platform developments add context to the AI narrative:

Firefly & Creative Cloud
- Deep generative AI integration in Photoshop, Illustrator, Premiere, Lightroom, Express, and more, including advanced image and video generation, semantic editing, and 3D capabilities. ^[27]
- At Adobe MAX, executives highlighted Acrobat + Express + Firefly as a unified workflow, plus Firefly Foundry and GenStudio for enterprise‑scale, brand‑safe content production. ^[28]
Acrobat AI Assistant & PDF Spaces
- Acrobat can now summarize, answer questions, and generate presentations or marketing materials directly from large sets of PDFs—an AI use case Adobe sees as a massive opportunity given “trillions” of PDF documents in circulation. ^[29]
Mobile Video Creation: Premiere on iPhone
- Adobe is bringing Premiere to iPhone as a free, pro‑grade mobile video editor, with multi‑layer timelines, 4K HDR support, automatic captioning, and one‑tap exports tailored for TikTok, YouTube Shorts, and Instagram. ^[30]
- Many of these experiences tie back into Firefly‑powered audio and video enhancements, designed to make Adobe more relevant to creators who live primarily on mobile.

All of this feeds the bull case that Adobe can grow ARPU, expand its user base, and defend its creative moat even as competition intensifies.

Strategic Moves: The $1.9 Billion Semrush Deal

On November 19, 2025, Adobe announced a definitive agreement to acquire Semrush Holdings, Inc. for $12 per share in cash, valuing the deal at around $1.9 billion. ^[31]

Key points:

Semrush is a leading brand visibility and SEO platform used by marketers for search, content, and competitive intelligence.
The deal has been approved by both companies’ boards and is expected to close in the first half of 2026, subject to regulatory and shareholder approvals. ^[32]
Barclays estimates Semrush could add 1–2 percentage points to Adobe’s FY2026 revenue growth once integrated, with a neutral to slightly positive impact on EPS. ^[33]

For Adobe, Semrush plugs directly into its Experience Cloud, analytics, and content platforms, and supports a vision of “generative engine optimization”—using AI not just to create content, but to optimize how that content is discovered, ranked, and personalized. ^[34]

It’s also symbolically important: Adobe’s last major attempt at a mega‑deal—the Figma acquisition—was blocked on antitrust grounds. The Semrush acquisition is smaller, more targeted, and widely viewed as more likely to clear regulators. ^[35]

Analyst Consensus & Price Targets: What the Numbers Say

Different data providers show slightly different snapshots, but they all point in the same general direction:

MarketBeat
- Consensus rating: “Hold” based on 29 analyst ratings
- Average 12‑month price target: $425.85
- Target range: $280 (low) to $590 (high)
- Implied upside from ~$346: about 23% ^[36]
StockAnalysis.com
- Coverage: 21 analysts
- Consensus rating: “Buy”
- Average price target: $454.90
- Target range: $280 to $600
- Implied upside: roughly 31% ^[37]
GuruFocus / broader brokerage survey
- Average target from 33 analysts: roughly $459.80, implying nearly 40% upside from a recent price just above $328.
- Average brokerage recommendation: about 2.1 on a 1–5 scale, where 2 corresponds to “Buy/Outperform.” ^[38]
QuiverQuant median price target
- Median target from 17 recent analyst forecasts: $430. ^[39]

Taken together, the Street’s message is:

Adobe’s growth story is intact, but investors are demanding more evidence that AI can re‑accelerate growth and margins.

That’s why the December 10 earnings call is being treated as a crucial catalyst.

The Bear Case: Why Some See More Downside

Not all commentary is bullish. A Benzinga technical analysis published this morning argues that Adobe remains in a persistent weekly downtrend, citing a proprietary “Adhishthana” cycle framework and noting that the stock has fallen about 25% since May 2025, despite rising markets. ^[40]

Bearish and cautious arguments generally revolve around:

AI Monetization Pace
- While AI ARR has topped $250 million, skeptics worry that the revenue boost is modest relative to Adobe’s >$23 billion revenue base, and may not justify prior valuation premiums. ^[41]
Competition
- Canva, CapCut, OpenAI‑powered tools, and cloud‑integrated design suites are eroding Adobe’s perceived moat in several segments, particularly among small businesses and social‑first creators. ^[42]
Macro and IT Budget Headwinds
- Although demand improved in 2025 versus a weak 2024 start, enterprises remain selective, and some investors worry about elongating deal cycles and cautious marketing spend, especially in Digital Experience. ^[43]
Execution Risk Around Semrush
- The Semrush integration must deliver cross‑sell and upsell benefits without distracting management or diluting margins. Some analysts have trimmed targets to reflect this added uncertainty. ^[44]

For traders focused on technicals, today’s rebound is encouraging—but it does not yet break the broader 2025 downtrend, which is why short‑term sentiment remains mixed.

The Bull Case: Why Long‑Term Investors Are Still Interested

On the other side, long‑term bulls point to several factors:

High Margins & Cash Generation
- Q3 non‑GAAP operating margins around the mid‑40s and multi‑billion‑dollar annual operating cash flow give Adobe flexibility to invest in AI, pursue M&A, and buy back stock simultaneously. ^[45]
Deep Integration of AI into Existing Workflows
- Rather than building isolated “AI apps,” Adobe is weaving AI into Photoshop, Illustrator, Premiere, Acrobat, Express, and enterprise products, making it harder for rivals to displace them without replacing entire workflows. ^[46]
Platform & Partner Strategy
- Partnerships with Google, YouTube, and third‑party LLM providers allow Adobe to tap into a broader ecosystem while still controlling the creative workflow layer—where much of the value sits. ^[47]
Attractive Valuation (Relative to Growth)
- With double‑digit revenue growth, strong margins, and a forward P/E in the mid‑teens, several analysts and quant models now describe Adobe as discounted relative to its long‑term growth profile, hence Barclays’ emphasis on a low PEG ratio. ^[48]

For investors with a multi‑year horizon, the debate is less about whether Adobe will grow, and more about how fast AI can move the needle and how durable its competitive advantages remain.

What to Watch Next Week

As December 10, 2025 approaches, here are the key metrics and themes likely to drive Adobe stock:

Q4 Numbers vs. Guidance
- Does revenue land toward the high end of the $6.08–$6.13 billion range?
- Is EPS closer to $5.40 than $5.35? ^[49]
AI ARR and Attach Rates
- Any new disclosure on AI‑specific ARR, Firefly adoption, Acrobat AI Assistant usage, and GenStudio penetration into large enterprises.
Digital Experience Bookings & Pipelines
- Color on pipeline health, deal sizes, and customer retention, particularly as Semrush is expected to plug into these products.
Updated Commentary on Semrush & M&A
- Integration roadmap, cost synergies, and cross‑sell opportunities.
- Any hints about future AI‑focused M&A, given Adobe’s strong balance sheet.
Capital Allocation
- Pace of share repurchases going into 2026.
- Potential for dividends in the longer term, though none are currently paid.

Bottom Line

On December 5, 2025, Adobe stock is at the center of a tug‑of‑war:

Bulls see a high‑margin software leader, embedding AI across a dominant creative and document ecosystem, trading at a discounted multiple and aggressively buying back shares.
Bears see a stock that has underperformed badly in 2025, facing intensifying AI competition, slower‑than‑hoped monetization, and fresh execution risk from a sizable acquisition.

With Wall Street price targets still implying double‑digit to high‑double‑digit upside but technicals flashing caution, Adobe has a lot riding on its Q4 FY2025 earnings report on December 10.

For now, ADBE remains a high‑quality, high‑debate AI and creativity platform stock—and today’s 5% jump shows just how quickly sentiment can shift when buybacks, analyst commentary, and AI optimism collide.