December 24, 2025 — Adobe Inc. (NASDAQ: ADBE) is ending the holiday-shortened Christmas Eve session in focus, as investors weigh two competing narratives: a high-margin software leader guiding to another year of growth — and a creative franchise facing louder questions about how generative AI reshapes its moat.
U.S. markets are open only briefly today, closing early at 1:00 p.m. ET, which often means thinner volumes and sharper intraday moves than usual. [1]
Adobe stock today: price action and where shares stand in 2025
Adobe shares traded around the mid-$350s on Wednesday. The stock opened at $352.21 and recently printed a high of $354.75, with a session low of $351.11; the latest close print listed for Dec. 24 is $354.13 (holiday session volume also notably lighter than a normal day). [2]
The bigger picture remains the headline: Adobe’s stock has fallen roughly 20% year-to-date even after a strong month-long rebound, underscoring how skeptical investors have been about the pace and durability of AI-driven upside across large-cap software. [3]
The backdrop: a shortened trading day as markets hover near highs
With markets closing early for the Christmas holiday, trading activity is generally quieter — a factor that can exaggerate stock moves in either direction. Broader U.S. equities hovered near record levels in the shortened session, according to the Associated Press, with investors still balancing growth optimism, AI enthusiasm, and interest-rate expectations. [4]
The core catalyst still driving Adobe: earnings, guidance, and the AI “proof” question
Adobe’s most important recent catalyst remains its Q4 and full-year fiscal 2025 results (released December 10, 2025) and, even more importantly, what management signaled about fiscal 2026.
From the company’s prepared remarks and investor materials, Adobe reported for FY2025:
- Revenue: $23.77 billion
- GAAP EPS: $16.70
- Non-GAAP EPS: $20.94 [5]
And for Q4 FY2025:
- Revenue: $6.19 billion
- GAAP EPS: $4.45
- Non-GAAP EPS: $5.50 [6]
Management repeatedly tied momentum to new AI-powered packaging and usage, arguing that AI is becoming embedded across Acrobat, Express, Creative Cloud, and its marketing stack. In Q4 highlights, Adobe said “total new AI-influenced ARR now exceeds one-third” of the overall business — a key metric investors are watching as a proxy for monetization progress rather than mere feature rollouts. [7]
Reuters also noted that Adobe’s FY2026 revenue and profit outlook came in above Wall Street expectations, signaling confidence in demand and in the company’s ability to monetize AI capabilities such as Firefly across Creative Cloud. [8]
FY2026 forecast: what Adobe is guiding — and what the market is debating
For fiscal 2026, Adobe’s targets (as shared in prepared remarks) include:
- Total Adobe revenue: $25.90 to $26.10 billion
- Total Adobe ending ARR “book of business” growth: 10.2% year-over-year
- GAAP EPS: $17.90 to $18.10
- Non-GAAP EPS: $23.30 to $23.50 [9]
On one hand, that’s a continuation of Adobe’s premium software model: recurring revenue, global scale, and cash generation (Adobe reported $10.03 billion in operating cash flow for FY2025). [10]
On the other hand, the market’s debate has become less about “does Adobe have AI?” and more about: how quickly can Adobe translate AI usage into sustained net-new recurring revenue without eroding pricing power.
That tension is visible in how shares have reacted to good news: even when results beat expectations, investors have often demanded clearer evidence that AI expands Adobe’s total addressable market — rather than compressing it by making creation cheaper and easier through AI-native rivals.
AI traction metrics Adobe is pointing to
In its prepared remarks, Adobe highlighted several operating indicators intended to support the “AI is additive” case:
- Monthly active users of Acrobat + Express surpassed 750 million (up 20% YoY) [11]
- Freemium web/mobile user acquisition across Firefly, Express, Premiere and other offerings grew >35% YoY to >70 million MAU [12]
- Consumption of generative credits increased 3x quarter-over-quarter [13]
- Demand for content automation offerings like Firefly Services and Firefly Foundry with ending ARR more than doubling YoY [14]
These are the kinds of metrics that matter for SEO-focused readers tracking “Adobe AI” and “Firefly” headlines — because they are a bridge between feature excitement and revenue durability.
Semrush acquisition: Adobe doubles down on the “agentic web” and brand discovery
Another major overhang and opportunity for Adobe stock into 2026 is its planned acquisition of Semrush.
Adobe’s CFO said the company announced (on Nov. 19) its intent to acquire Semrush in an all-cash transaction valued at about $1.9 billion, expecting to close in the first half of FY2026, subject to approvals. Management also stated the acquisition’s non-GAAP EPS impact should be negligible in the first year post-close and accretive thereafter, and emphasized that FY2026 targets do not include Semrush contributions. [15]
Coverage of the deal also described the offer as $12 per share for Semrush and reiterated the expected first-half 2026 closing window. [16]
Why investors care: in Adobe’s view, search and discovery are changing as generative AI and “agentic” browsers drive traffic differently. In its earnings materials, Adobe cited Adobe Digital Index findings showing generative AI traffic up 760% in the 2025 holiday season, framing Semrush as complementary infrastructure for marketers who need brand visibility across traditional search and AI-driven discovery. [17]
Analyst outlook: price targets are wide — and the split is the story
If you’re looking for “Adobe stock forecast” themes on December 24, the most important takeaway is not any single target — it’s the dispersion.
Bearish pressure: downgrades highlight AI-native competition risk
Several analysts have turned cautious in December. For example, KeyBanc’s Jackson Ader downgraded Adobe to Underweight and set a $310 price target (coverage circulating broadly via finance news syndication). [18]
MarketWatch and Barron’s reporting around software-sector weakness has echoed the same fear: AI lowers the friction of creation, inviting new competitors and shifting power toward platforms, model providers, and AI-native applications — potentially compressing legacy software valuations even when fundamentals remain solid. [19]
Bulls’ case: “quality at a discount” — if Adobe can prove monetization
On the bullish side, valuation-focused analyses published today argue that Adobe’s selloff has created an attractive entry setup.
- Trefis published a Dec. 24 note placing fair value at $470 versus a market price around $352, implying about 33% upside, framing Adobe as “high margins for a discounted price.” [20]
- Simply Wall St published a Dec. 24 analysis estimating an intrinsic value of about $519.90 per share from its DCF model (about a 32% discount versus the prevailing share price), highlighting Adobe’s free cash flow base and projecting higher cash generation over time. [21]
It’s crucial to read these as model-based estimates, not guarantees — but they reflect what many investors are doing now: re-underwriting Adobe as a cash-flow compounder rather than a high-multiple growth stock.
Today’s “micro news”: institutions trimming positions
Two additional Adobe headlines dated Dec. 24 involve routine institutional positioning rather than product or earnings catalysts:
- MarketBeat reported Swedbank AB trimmed its Adobe position by 2.8% (selling 22,401 shares). [22]
- MarketBeat also reported Exchange Traded Concepts LLC sold 29,993 shares. [23]
These kinds of items can contribute to daily news flow (and Discover visibility), but they typically don’t change the long-term thesis unless part of a broader trend.
What to watch next for Adobe stock in 2026
If you’re tracking Adobe for the next leg up (or down), here are the highest-signal checkpoints investors are likely to focus on:
- Q1 FY2026 earnings (March 12, 2026) — Adobe has listed this as its next scheduled earnings call. [24]
- AI monetization evidence — investors will look for continued expansion in AI-influenced ARR, Firefly-related monetization, and whether AI-first products pull new users into paid tiers. [25]
- Semrush deal progress — timing, regulatory clearance, and how Adobe integrates Semrush into Experience Cloud workflows and its “agentic web” toolkit. [26]
- Competitive pressure in creative tooling — the bear thesis remains that AI-native tools (and even model providers) could erode Adobe’s differentiation and pricing power, keeping multiples depressed even with steady growth. [27]
- Capital returns — Adobe highlighted aggressive repurchases in FY2025 (including the remaining authorization capacity), which can support EPS growth if cash flow remains strong. [28]
Bottom line on Dec. 24, 2025: Adobe stock is a valuation-and-AI referendum
Adobe stock on Christmas Eve 2025 is trading like a company in transition — not because the core business is broken, but because the market is demanding clarity on who wins the economics of generative AI.
The data points are real: record FY2025 revenue, strong profitability, and a FY2026 outlook that management says reflects momentum — plus a strategic bet on Semrush to help marketers adapt to AI-driven discovery. [29]
But so is the pushback: analysts and investors remain divided on whether Adobe’s AI integration expands its franchise — or accelerates competitive commoditization. That split is exactly why today’s forecasts range from “materially undervalued” to “still vulnerable,” even as the stock sits near the mid-$350s heading into 2026. [30]
This article is for informational purposes only and is not investment advice.
References
1. www.nyse.com, 2. stockanalysis.com, 3. simplywall.st, 4. apnews.com, 5. www.adobe.com, 6. www.adobe.com, 7. www.adobe.com, 8. www.reuters.com, 9. www.adobe.com, 10. www.adobe.com, 11. www.adobe.com, 12. www.adobe.com, 13. www.adobe.com, 14. www.adobe.com, 15. www.adobe.com, 16. www.tipranks.com, 17. www.adobe.com, 18. finance.yahoo.com, 19. www.marketwatch.com, 20. www.trefis.com, 21. simplywall.st, 22. www.marketbeat.com, 23. www.marketbeat.com, 24. www.adobe.com, 25. www.adobe.com, 26. www.adobe.com, 27. www.barrons.com, 28. www.adobe.com, 29. www.adobe.com, 30. simplywall.st
