Adobe Posts 11% Revenue Growth, Shares Slip AI Fears
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- Adobe reported revenue up 11% in constant currency, with business/consumer subscription revenue up 15% and creative/marketing revenue up 11%, and operating income rising to $2.4 billion from $2.1 billion a year earlier.
- Adobe’s shares fell despite the strong results, as investors worried about AI‑driven disruption and the sudden retirement of longtime CEO Shantanu Narayen.
- Adobe has been aggressively repurchasing its own stock, cutting shares outstanding by 11% over the past three years.
- Salesforce authorized a $50 billion stock‑repurchase program, a capital‑return move that could boost EPS as shares are reduced.
- Micron Technology is slated to report earnings on March 18, and any guidance showing continued AI‑related demand could signal further pressure on software stocks.
- Accenture will report earnings on March 19, and its commentary on client shifts from legacy software to AI tools will be a direct read on the software‑disruption narrative.
Why it matters: Investors see Adobe’s solid earnings as a buying opportunity, with its P/E at a 10‑year low of 15, while the AI‑disruption narrative pressures its share price, penalizing the stock despite strong cash flow and aggressive share‑repurchase. At the same time, upcoming earnings from Micron and Accenture will serve as barometers for AI’s broader impact on software demand, influencing sector sentiment.
