Adobe Analyst Frets Over Shaky Fundamentals Ahead Of Q4 Results: Retail Optimistic

Citi analysts said Adobe’s core business faces continued revenue leakage, exacerbated by inclement macroeconomic conditions and competitive threats.
 Adobe logo is displayed on the side of the Adobe Systems headquarters January 15, 2010 in San Jose, California. Adobe Systems has added 20 new wind turbines to their rooftops in an attempt to harness wind energy to help power their offices.
Adobe logo is displayed on the side of the Adobe Systems headquarters January 15, 2010 in San Jose, California. (Photo by Justin Sullivan/Getty Images)
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Shanthi M·Stocktwits
Updated Jul 02, 2025   |   8:31 PM GMT-04
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San Jose, California-based Adobe Inc. ($ADBE), a provider of document processing software, services and tools, is scheduled to report its fiscal year 2024 fourth-quarter results after the market closes on Wednesday.

On average, analysts expect the company to report non-GAAP earnings per share (EPS) of $4.67 versus $4.27 a year ago and guidance of $4.63 to $4.68. 

Revenue is expected to rise 9.7% year-over-year (YoY) to $5.54 billion. The guidance issued in mid-September calls for revenue of $5.50 billion to $5.55 billion. 

Third-quarter revenue was $5.41 billion, with $4 billion coming from the digital media segment and $1.35 billion from the digital experience segment. Net new digital media annualized recurring revenue (ARR) was $504 million and the company exited the quarter with Digital Media ARR of $16.76 billion. 

Adobe's remaining performance obligations (RPO) at the end of the third quarter was $18.14 billion. 

Citi analysts reduced the price target for Adobe stock from $616 to $590 on Monday and maintained a ‘Neutral’ rating, TheFly reported. The analysts said the core business faces continued revenue leakage, exacerbated by inclement macroeconomic conditions and competitive threats. 

However, with a lower bar for fiscal 2025 ARR, the guidance could be in line, they said.

Adobe’s management will host an earnings call at 5 p.m. ET. 

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ADBE sentiment and message volume December 11, 2024, premarket as of 9:03 am ET | Source: Stocktwits

Sentiment toward Adobe stock improved from 'neutral' a day ago to 'bullish' (55/100), with message volume perking up to ‘high.’

A Stocktwits user sees existential risk for Adobe. “Everything Adobe makes will get replaced by AI code tools within 12 months,” they said.

A bullish user, however, suggested the stock is undervalued at current levels.

In premarket trading, as of 9:03 a.m. ET, Adobe shares rose 0.25% to $548.40. For the year, the stock is down 8.31%, grossly underperforming the Invesco QQQ Trust ETF ($QQQ), which is up about 28% for the same period.

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