Adobe Inc. (ADBE)

Adobe reported record third-quarter fiscal 2026 revenue of $6.76 billion on 10 September, up 13 percent from a year earlier 1. The quarter ended 28 August 2026 1.

Annualized recurring revenue, the yearly value of its subscription contracts, reached $27.50 billion, up 11.2 percent 2. The company raised its full-year revenue target to a range of $26.576 billion to $26.626 billion 1.

On 2 September the board named Anil Chakravarthy, who runs the customer experience business, as chief executive, effective 1 December 2026 3. Shantanu Narayen becomes executive chair 3.

David Wadhwani, who led the creative and productivity business, stepped down as its president effective 27 September, and will stay as a senior advisor 3. The chief financial officer role has been held on an interim basis since June 7.

Adobe says the lift came from AI products and a wider user base, and cites a milestone of 1 billion monthly active users across its creativity and productivity tools 1. Its board called the new chief executive the right leader for the next chapter of growth 4.

Adobe makes software that people use to create, edit and share images, video, documents and web pages 5. Revenue grew each year from fiscal 2023 to fiscal 2025: $19,409 million, then $21,505 million, then $23,769 million 5.

Nearly all of it is subscription revenue, fees customers pay to keep using the software, which was $22,904 million of the fiscal 2025 total, or 96 percent 5. Product sales and services made up the rest 5.

In fiscal 2024 a deal fell apart 5. Adobe had agreed to buy Figma, a design tool, and the deal was terminated; the company paid a $1 billion termination fee in fiscal 2024 5.

Investors later sued over how Adobe described the Figma competition 2. A federal court dismissed that securities case on 27 March 2025, and the plaintiff is appealing 2.

Fiscal 2025 was the strongest year in the stretch 5. Revenue rose 11 percent to $23,769 million, and net income rose 28 percent to $7.13 billion 5.

The company explained that Digital Media, its creative and document tools, brought in $17.65 billion, up 11 percent, and Digital Experience, its software for marketers, brought in $5.86 billion, up 9 percent 5.

A consumer-protection case ran alongside 2. The Justice Department filed a civil complaint on 17 June 2024 over how Adobe disclosed subscription terms and handled cancellations 2. The court denied Adobe's motion to dismiss on 2 May 2025 2.

The case was settled in March 2026 2. The Justice Department's proposed order requires $75 million in civil penalties and $75 million in free services for customers, as the department's statement was reported 8.

Fiscal 2026 changed the shape of the company 2. In the first quarter, Adobe combined its three former segments into a single reportable segment, saying management now sells and builds the products together 2.

It agreed on 18 November 2025 to buy Semrush for about $1.9 billion in cash, and completed the purchase on 28 April 2026 for $1.87 billion 52.

The customer list is broad 2. The company says its focus is business professionals, consumers, creators, creative professionals and marketing professionals 2.

The company also reports a $92 million loss contingency tied to a legal settlement and other legal matters in the nine months of fiscal 2026 2.

In the nine months to 28 August 2026, revenue was $19,776 million against $17,575 million a year earlier 2. A goodwill impairment of $70 million hit the Publishing and Advertising unit 2.

Creative and marketing tools

Adobe now reports two customer groups 2. Creative & Marketing Professionals covers Photoshop, Lightroom, Illustrator and Premiere, plus software that helps companies run customer experiences 2. Its subscription revenue was $4.65 billion in the third quarter, up 13 percent 2.

The marketing side includes Adobe Analytics, Adobe Experience Manager, Adobe Commerce, Marketo Engage and GenStudio, which help companies make content, track customers and personalize what each one sees 2.

Semrush adds tools for search engine optimization, and for being found by AI answer engines, to the Experience Manager offering 2.

Acrobat and Express

Business Professionals & Consumers covers Adobe Acrobat, the PDF tool, and Adobe Express, a web and mobile app for people who are not design experts 2. Acrobat Studio joins Acrobat, Express and AI agents in one place 2.

This group's subscription revenue was $1.91 billion in the third quarter, up 16 percent from $1.65 billion 2. Acrobat Reader is free to use, and Adobe describes it as a way to reach people at scale 5.

Firefly and AI

Adobe Firefly is the company's family of generative AI models for images, video, vector graphics and audio 5. Adobe says the models are trained on data it has the rights to use, and each generated asset carries Content Credentials, a label showing AI was used 5.

Adobe reported that its AI-first annual recurring revenue grew more than 150 percent over the year 1. Topaz Labs, an AI company for video and image enhancement, was bought and stays a separate brand 9.

Offices and people

Adobe is headquartered in San Jose, California, where it occupies about 1.7 million square feet that it owns 5. Its largest offices outside the United States are in Bangalore and Noida, India, each about 0.7 million square feet 5.

Shantanu Narayen is chair and chief executive until 1 December 2026 3. Anil Chakravarthy joined Adobe in January 2020 and earlier ran Informatica as chief executive for four years 4.

Steven Day, who joined the company in 2006, is interim chief financial officer after Daniel Durn resigned effective 15 June 2026 7.

Adobe repurchased about 9.5 million shares in the third quarter, and open market repurchases in the nine months were 26.1 million shares for $6,820 million 12.

Remaining performance obligations, contracted revenue not yet recognized, were $22.16 billion at the end of the quarter 1.

Adobe's GAAP diluted earnings per share was $4.62 for the quarter, and cash flow from operations was $2.52 billion 1.

GAAP operating income was $2.35 billion in the quarter 1. GAAP net income was $1.83 billion 1.

Rivals

Adobe does not name its rivals one by one 5. It says it competes with software companies, AI companies, hardware makers, operating system developers and social media companies 5.

For consumers it names web and mobile design platforms, presentation tools and AI-first creativity tools as the competition 5.

Current problems

The Labor Department stopped new and pending PERM labor certifications, the first step toward employer-sponsored green cards, for Microsoft, Adobe and six other employers on 8 October, as announced at a White House news conference 10.

Vance said the suspensions will remain in place as long as it needs to, and the administration alleges the certifications are false when companies use the program to replace U.S. workers 10.

The securities class action over Figma-era statements is on appeal, and a related shareholder derivative case is also pending 2.

The umbrella, in words

Adobe's brands include Photoshop, Illustrator, Lightroom and Premiere in Creative Cloud, Acrobat and Express for documents and quick design, and Experience Manager, Marketo Engage, Analytics and GenStudio for marketers 2.

Its subsidiaries list on the annual report includes Frame.io, Marketo, Workfront and MagentoTech, plus operating companies in many countries 6.

It owns Semrush, bought outright on 28 April 2026 for $1.87 billion, and agreed on 24 June 2026 to buy Topaz Labs for about $340 million, which closed on 23 September 29.

Its only listed class is common stock on the Nasdaq Global Select Market, with a par value of $0.0001 per share 3.

Adobe's board said Chakravarthy will become chief executive and join the board on 1 December 2026, with Narayen working closely with him as executive chair during the transition 4.

For the fourth quarter, the company expects total revenue of $6.80 billion to $6.85 billion 1. It expects non-GAAP earnings per share of $6.30 to $6.35 1.

For the full year, the company targets total revenue of $26.576 billion to $26.626 billion and ending annual recurring revenue growth of 10.2 percent 1.

Adobe's targets assume a non-GAAP operating margin of about 45.0 percent for the year and about 389 million diluted shares in the fourth quarter 1.

Steve Day, interim finance chief, said Adobe is expanding its user base through a freemium strategy and deepening engagement with agentic experiences 1.

Adobe's board authorized in April 2026 a further $25 billion of share repurchases through 30 April 2030, and $24.55 billion remained at 28 August 2026 2.

The company also reported total customer group subscription revenue of $6.56 billion in the third quarter, up 14 percent 1.

For the fourth quarter, the company targets Business Professionals & Consumers subscription revenue of $1.93 billion to $1.95 billion 1. It targets Creative & Marketing Professionals subscription revenue of $4.665 billion to $4.695 billion 1.

The company targets a GAAP tax rate of about 22.5 percent for the full year 1.

The company will host its MAX conference in Miami Beach from 10 to 12 November 2026, according to its event page 11.

Topaz Labs stays a standalone brand, and its chief executive joins Adobe's digital video and audio team, according to Digital Production 9. The same report says Topaz technology is already available through Firefly and Photoshop, with more Adobe workflows planned 9.

Vance said the PERM suspensions will remain in place as long as it needs to, with no end date stated in the report read 10.