Adobe Stock (ADBE) Jumps Into Q4 2025 Earnings Week: AI, Buybacks and Price Targets Explained

Updated December 7, 2025

Adobe Inc. (NASDAQ: ADBE) heads into its fourth‑quarter fiscal 2025 earnings week with its share price finally moving up again, even as the stock remains deeply in the red for the year. As of the latest close, Adobe trades around $346 per share, up roughly 5% in the last session after investors reacted positively to renewed emphasis on share buybacks and confidence in the company’s AI roadmap. Year to date, the stock is still down a little over 20% and sits about 37% below its 2024 peak near $553. ^[1]

The rally comes just days before Adobe reports Q4 and full‑year FY2025 results on December 10, 2025, in a release and investor call that management has already flagged as a key update on AI, the Semrush acquisition and long‑term growth. ^[2]

Adobe stock today: price, performance and valuation

Despite the latest bounce, Adobe remains a classic “good business, bruised stock” story in 2025.

Price & drawdown: Adobe’s share price near $346 is roughly 21–22% lower year to date and about 37% below its 52‑week high of $552.96 hit in December 2024. ^[3]
Market value: Depending on the source, Adobe’s market cap is currently in the $135–145 billion range, with enterprise value estimated around $142 billion, notably below its three‑ and five‑year averages. ^[4]
Earnings multiple: Recent data put Adobe’s trailing price‑to‑earnings (P/E) ratio around 21–22, with a forward P/E near 15 and a PEG (price/earnings‑to‑growth) ratio close to 1.0—low relative to its own history and cheaper than many large software peers. ^[5]

These metrics underpin a growing narrative that Adobe is fundamentally healthy but sentiment‑depressed, largely because investors are still trying to price the impact of generative AI and new competition in design and marketing tools.

Why Adobe stock is rebounding right now

1. Massive buybacks are finally getting attention

Several recent analyses highlight how aggressively Adobe has been shrinking its share count:

Over the past 12 months, Adobe has repurchased more than $12 billion worth of its own stock, equivalent to roughly 8.3% of its market capitalization—its most aggressive buyback pace in at least two decades. ^[6]
A fresh note from Finviz/StockStory framed the recent move higher as a response to that buyback program, estimating a net buyback yield near 8% and arguing that the scale of repurchases signals strong management conviction in long‑term value. ^[7]

A December 7 analysis from Simply Wall St noted that Adobe’s 5.3% one‑day gain to $346.26 stands in sharp contrast to its ~21.5% year‑to‑date decline and roughly 37% one‑year total drawdown, and argued the bounce is driven more by renewed confidence around buybacks, AI partnerships and the Semrush deal than by any fundamental shift in the business overnight. ^[8]

2. Sentiment is flipping from fear to cautious optimism

Retail and social sentiment has also shifted noticeably in early December:

A 24/7 Wall St. piece using Polymarket data reports that traders are pricing in a 91% probability that Adobe will beat earnings estimates on December 10, with retail sentiment scores in the low‑70s on social platforms—firmly bullish territory after a late‑November oversold period. ^[9]
Quiver Quant’s tracking of discussions on X (formerly Twitter) shows conversation increasingly focused on Adobe’s AI integration (especially Firefly), partnerships with large tech platforms and the “opportunity” created by the stock’s drop from 2024 highs. ^[10]

Put simply: the market didn’t suddenly discover Adobe is profitable and cash‑generative—it knew that already. What changed this week is that investors started believing those fundamentals might actually matter again.

Q4 FY2025 earnings preview: what Wall Street expects

Adobe will report Q4 FY2025 and full‑year results after the bell on December 10, followed by an investor call. ^[11]

Across Zacks, Nasdaq and other consensus trackers, expectations cluster around:

Revenue: ~$6.1 billion (about 8–9% year‑over‑year growth). ^[12]
Non‑GAAP EPS: roughly $5.39–$5.40, implying ~12% growth versus last year’s comparable quarter. ^[13]

In Q3 FY2025, Adobe already showed it can still grow:

Adjusted EPS rose to $5.31 from $4.65 a year earlier.
Revenue climbed to $5.99 billion from $5.41 billion, beating expectations.
Management raised its full‑year FY2025 guidance to $23.65–$23.70 billion in revenue and $20.80–$20.85 in adjusted EPS. ^[14]

Given that backdrop, investors will be zeroed in on a few key items on December 10:

Digital Media and Creative Cloud ARR:
Adobe has signaled it will stop breaking out Digital Media annual recurring revenue (ARR) separately in future reporting and instead focus on total ARR. Citi analysts interpret this as a sign that Creative Cloud growth is moderating, estimating roughly 10% ARR growth in FY2026 and warning that higher AI infrastructure costs could press margins. ^[15]
AI monetization and Firefly attach rates:
With Firefly and AI assistants embedded across Photoshop, Illustrator, Premiere, Acrobat and Express, investors want clearer numbers on how many users are paying more for AI functionality and how that translates into ARR and margins.
Semrush integration and “agentic AI” story:
Adobe’s pending $1.9 billion all‑cash acquisition of Semrush is framed as a way to help marketers manage brand visibility not only in search engines but across large language models like ChatGPT and Google’s Gemini—what Adobe calls generative engine optimization (GEO). ^[16]
Updated FY2026 guidance:
With consensus expecting mid‑single‑digit to low‑double‑digit growth for revenue and EPS, any change in guidance—or new commentary on AI‑related costs versus revenue uplift—could move the stock quickly. ^[17]

Adobe’s AI strategy: Firefly, Google Cloud, HUMAIN and Semrush

Firefly inside everything

Adobe has spent the past two years turning Firefly, its generative AI family, into the connective tissue of its product portfolio:

Firefly models are embedded into Photoshop, Illustrator, Premiere Pro, After Effects, Adobe Express and the new Firefly web app, enabling text‑to‑image, generative fill, style transfer and more. ^[18]
Adobe repeatedly emphasizes that Firefly is trained on licensed and “commercially safe” data, which appeals to enterprise legal teams that worry about copyright exposure from more opaque AI models. ^[19]

This “trust and safety” angle is now a core part of Adobe’s moat narrative: the company argues that its proprietary creative data, from millions of user projects and workflows, forms a unique training corpus for AI models that rivals can’t scrape. The viral “data moat” thesis highlighted on Reddit and picked up by 24/7 Wall St leans heavily into this argument. ^[20]

Google Cloud and Gemini partnership

At Adobe MAX 2025, Adobe and Google Cloud announced an expanded strategic partnership to integrate Google’s newest AI models—Gemini, Veo and Imagen—directly into Adobe’s apps and platforms: ^[21]

Creators and enterprises will be able to access Google’s models inside Firefly, Photoshop, Adobe Express, Premiere and GenStudio.
Through Adobe Firefly Foundry, enterprise customers can customize Google’s models with their own proprietary data on Google Cloud’s Vertex AI, generating brand‑safe content at scale. ^[22]

This deal is strategically important: it lets Adobe offer a multi‑model, multi‑cloud AI environment while keeping the user experience centered in its own apps and workflow tools.

HUMAIN and region‑specific AI

In November, Adobe also announced a global partnership with HUMAIN to build AI models and applications tuned for the Arabic‑speaking world, targeting local brands and governments that want culturally and linguistically aligned AI experiences. ^[23]

Together with Semrush, these moves position Adobe not just as a tools vendor but as an AI‑driven marketing infrastructure platform spanning content creation, analytics, brand visibility and AI‑era search.

Holiday ecommerce data: Adobe Analytics as a macro tailwind

Beyond creative software, Adobe’s Analytics and digital experience business gives it a front‑row seat to online spending trends:

Adobe recently forecast that U.S. online holiday spending would surpass $250 billion, with one release highlighting $253.4 billion in projected sales, up around 5% year over year. ^[24]
Separate Adobe Analytics data cited by Reuters showed record Black Friday online sales of $11.8 billion, up 9.1% from 2024, and projected Cyber Monday spending of $14.2 billion. ^[25]

These numbers don’t just generate headlines; they support Adobe’s pitch that its data, not just its design tools, will be critical to how brands navigate AI‑enhanced marketing and ecommerce in 2026 and beyond.

Who owns Adobe now? Big institutions and ETFs dominate

TipRanks’ latest ownership breakdown shows that institutions overwhelmingly control Adobe stock: ^[26]

Public companies and individual investors: ~40%
ETFs: ~30%
Mutual funds: ~19%
Insiders: ~10%

Vanguard is the largest single shareholder, with over 8% of the company, and major ETFs like Vanguard Total Stock Market (VTI) and Vanguard S&P 500 (VOO) each hold meaningful stakes.

That institutional base helps explain the stock’s volatility profile: Adobe doesn’t trade like a meme stock, but when large funds rebalance or shift AI allocations, the stock can move sharply.

Wall Street’s view: mostly bullish, but getting more selective

Across major data providers, the consensus on Adobe remains positive but less euphoric than in its high‑multiple days:

StockAnalysis reports an average rating of “Buy” with a 12‑month price target around $455, implying roughly 30% upside from current levels. ^[27]
24/7 Wall St. cites 24 Buy or Strong Buy ratings vs. 3 Sell ratings, with a consensus target of about $450, again implying ~30–35% upside. ^[28]
MarketWatch and other aggregators list average targets in the mid‑$440s to mid‑$450s, based on about 40+ analyst ratings. ^[29]

But there’s real dispersion underneath that average:

Citi’s Tyler Radke kept a Neutral/Hold rating and cut his target from $400 to $366, flagging slower Digital Media growth and AI‑related margin pressure. ^[30]
Barclays maintained an Overweight rating but trimmed its target from $465 to $415, citing more cautious assumptions for ARR and the timing of Semrush synergies. ^[31]
Other firms remain more bullish: DA Davidson, Wells Fargo and others still have targets between $390 and $600, with some calling Adobe “undervalued relative to growth potential.” ^[32]

In short, Wall Street broadly agrees that the stock is too cheap for a company with Adobe’s margins and cash flow, but there is growing disagreement on how fast it can grow in an AI‑crowded world and how much investors should pay for that growth.

The bear case: growth slowdown and AI competition

While a flurry of recent articles argue Adobe is “extremely cheap” or “mispriced,” the bear case is not imaginary. Key concerns include:

Creative Cloud growth deceleration
Citi’s critique that Adobe is changing its ARR disclosure because Creative Cloud growth is slowing has resonated with investors who worry the easy subscription expansion era is over. Expected ~10% ARR growth for FY2026 is solid, but not the hyper‑growth story some AI investors crave. ^[33]
Heavy AI investment and margin pressure
Building proprietary models, licensing third‑party models (like Google’s Gemini), and serving compute‑intensive workloads at scale is expensive. Analysts warn that AI may raise operating costs faster than it boosts revenue—at least in the near term. ^[34]
Rising competition
From Canva and Figma in design collaboration to Midjourney, Runway and others in generative creativity, Adobe is surrounded by cheaper or more experimental rivals. Investorsobserver notes that some analysts now talk about “AI eating software,” questioning whether Adobe is moving fast enough. ^[35]
Metric changes and market trust
Moves like dropping Digital Media ARR disclosure or leaning heavily on non‑GAAP metrics give skeptics more ammunition. GuruFocus framed Adobe’s metric changes as a “subtle warning” that top‑line growth is normalizing. ^[36]

The bull case: a rare combination of moat, margins and a reset valuation

On the other side, a string of bullish theses from Insider Monkey, Simply Wall St, Invezz and others make a coherent long‑term argument: ^[37]

Elite fundamentals:
Adobe continues to post near‑90% gross margins, very high returns on equity and robust free cash flow. Its enterprise value is well below recent history, even as revenue and EPS keep climbing.
Recurring revenue machine:
The combination of Creative Cloud + Document Cloud (~$18B in recurring revenue) and Digital Experience (~$6B) forms a diversified, sticky subscription base that is hard to dislodge at scale.
AI as an accelerant, not a threat:
Bulls argue that generative AI makes Adobe’s tools more valuable, not less, by compressing tedious work and expanding the number of people who can produce “good enough” creative output within Adobe’s ecosystem. Firefly’s “commercially safe” positioning and the ability to tune models with Semrush and Google Cloud data are seen as durable differentiators.
Valuation reset:
With a forward P/E in the mid‑teens and a PEG ratio near 1, Adobe now trades at a discount to its historic multiples and to some mega‑cap tech peers, despite having a stronger recurring revenue base than many. ^[38]
Shareholder‑friendly capital allocation:
The 8%+ buyback yield over the past year means that even modest growth can translate into faster EPS growth per share, as the denominator (share count) shrinks. ^[39]

Is Adobe stock (ADBE) a buy ahead of earnings?

Whether Adobe is a buy at $346 depends on your tolerance for short‑term narrative whiplash.

What you’re betting on if you’re bullish:

That Adobe’s AI integration (Firefly, Semrush, Google Gemini, HUMAIN) drives higher ARPU (average revenue per user) and stickier enterprise relationships over the next 3–5 years. ^[40]
That current valuations—forward P/E near the mid‑teens, EV below recent averages, ~30% implied upside from consensus price targets—represent a mispricing of a high‑margin software franchise. ^[41]
That AI won’t commoditize creativity as quickly as feared, and that Adobe’s data moat plus enterprise‑grade compliance and workflows remain valuable even in a world full of cheap AI image generators. ^[42]

What you’re worried about if you’re cautious or bearish:

That growth in Creative Cloud and Digital Media is slowing, even as competition intensifies and AI infrastructure costs rise. ^[43]
That metric changes and mixed analyst signals point to a multi‑year “show me” phase, where the stock chops sideways until Adobe proves that AI can accelerate, not just defend, its growth. ^[44]

For now, the pre‑earnings setup is clear: expectations are cautiously optimistic, options and prediction markets are tilted toward a beat, and both bulls and bears have fresh data to point to.