The author argues the market misreads Adobe's AI risk: concerns about AI have pushed the stock down 24.62% year to date to $263.82, while the company's financials show it benefiting from AI. AI-first ending ARR topped $650 million, up more than 150% year over year, monthly active users passed 1 billion, and total ARR reached $27.5 billion, up 11.2%. Third-quarter revenue rose 12.89% to $6.76B and free cash flow grew 14.68% to $2.438B, with management targeting a full-year non-GAAP operating margin of about 45%. Adobe raised fiscal 2026 non-GAAP EPS guidance to $24.45–$24.50 and retired roughly 8.1M, 8.5M and 9.5M shares across the first three quarters, with $24.55 billion still authorized. The author flags risks including RPO growth of only 8% and a CEO change, as Anil Chakravarthy takes over from Shantanu Narayen, who led the company for 29 years, on December 1.
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