Adobe Stock Surges 4% After Raising Annual Outlook

Lead: In premarket trading on September 12, Adobe Inc. shares jumped 4% after the software giant raised its full-year revenue and earnings guidance following a stronger-than-expected third-quarter performance driven by AI adoption.

Nut Graf: Adobe’s Q3 results revealed $5.99 billion in revenue-up 11% year-over-year-and AI-influenced annual recurring revenue topping $5 billion. Management cited robust Creative Cloud demand and new AI agents as catalysts for the upgraded outlook, underscoring the company’s growing monetization of generative tools.

Key Drivers of Today’s Rally

Raised Guidance: Adobe lifted its FY25 revenue forecast to $23.65-$23.70 billion and raised non-GAAP EPS guidance to $20.80-$20.85 per share, both above Wall Street estimates.
AI-Powered Growth: AI-influenced ARR surpassed $5 billion, double its level at the end of fiscal 2024, highlighting accelerating enterprise adoption of Firefly and other generative features.
Strong Creative Cloud Demand: Digital Media revenue climbed 12% to $4.46 billion as Photoshop, Illustrator, and Acrobat integrations drove sticky usage across individual and enterprise users.

Market Reaction and Outlook

Adobe’s stock, down 21% year-to-date, reversed early losses in premarket trading, reflecting renewed investor confidence in the company’s AI strategy. Analysts pointed to the upgraded guidance and tangible AI revenue as evidence that Adobe is converting innovation into concrete financial results.

What Comes Next

Adobe expects Q4 revenue of $6.08-$6.13 billion and adjusted EPS of $5.35-$5.40-both ahead of consensus forecasts. The company also plans to roll out additional AI agents for marketing automation and LLM optimizers to bolster its Digital Experience segment, aiming to drive further seat expansions and upsells.