Adobe (ADBE) Stock Forecast & Price Target

Adobe is supported by resilient subscription demand, with total revenue of $6,760M up 13% Y/Y and non-GAAP EPS of $6.13 beating consensus, while total ARR climbed to $27.5B and AI-first ARR exceeded $650M, up 150% Y/Y. Its growth outlook is reinforced by strong momentum in Firefly, Acrobat and Express MAUs above 900M, and expanding traction in both Digital Media and Digital Experience, where several solutions are delivering ending ARR growth of over 20% Y/Y. Management’s raised FY/26 revenue and EPS guide, along with expected ~44% non-GAAP operating margins next quarter and a 12% full-year revenue growth midpoint, suggest durable profitability and continued monetization of AI and freemium initiatives.

Adobe is facing a negative fundamental setup because its core subscription businesses compete in intensely crowded markets, where failure to renew customers or respond to new technology could quickly pressure revenue and operating results. Management’s mixed guidance reinforces that concern: despite a fiscal third-quarter beat, it held FY26 revenue expectations in check and kept ARR growth guidance at 10.2% year over year, while fourth-quarter midpoint revenue guidance of $6.825 billion implies only 10.2% growth. It is also prioritizing freemium adoption and MAU expansion over near-term monetization, even as Creative freemium MAUs surpassed 100 million, leaving investors uncertain about when user growth will translate into stronger financial performance.