Abobe Inc.
[ADBE]
NASDAQ
MVPro™ Score: 63/100
Last Earnings: 11 Dec 2025
[ADBE]
NASDAQ
MVPro™ Score: 63/100
Last Earnings: 11 Dec 2025
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| Capitalization (mln USD) | 148,667 |
| Revenue (mln USD) | 5,988 |
| EBITDA (mln USD) | 2,381 |
| Net Income (mln USD) | 1,772 |
| Net Margin | 29.59% |
| EPS Ratio (TTM, USD) | 16.41 |
| P/E Ratio (TTM) | 21.37 |
| P/S Ratio (TTM) | 6.52 |
| D/E Ratio | 1.44 |
| EV/EBITDA (TTM) | 17.54 |
| CAPEX (Q/Q) | 53.19% |
| Dividend Yield | 0.00% |
Revenue, EBITDA & Net Income
Company Overview
Adobe Inc., founded in 1982, has grown from a small start-up into one of the world’s most recognised software companies. The firm is headquartered in San Jose, California, and has played a pivotal role in shaping digital media creation and publishing. Over the years, Adobe has continually adapted its business model, shifting from packaged software to a successful cloud-based subscription platform.
The company’s flagship offerings include Adobe Creative Cloud, featuring industry-leading tools such as Photoshop, Illustrator, and Premiere Pro. In addition, Adobe Document Cloud and Adobe Experience Cloud provide solutions for digital documents and customer experience management. Adobe is currently led by Shantanu Narayen, who has served as Chief Executive Officer since 2007 and overseen the company’s transformation into a digital services powerhouse.
Operating across North America, Europe, and Asia-Pacific, Adobe serves individuals, small businesses, large enterprises, and governments. Its mission is to empower creativity and innovation for everyone, everywhere, by delivering cutting-edge digital tools and platforms. The company also demonstrates a strong commitment to ESG, focusing on sustainability initiatives, diversity and inclusion, and ethical governance. Through innovation, global reach, and responsible practices, Adobe continues to be a key driver in the digital economy.
🟡 P/E (Price to Earnings, TTM)
Price-to-earnings (P/E) ratio for the most recent quarter is 21.7, compared to 25.9 in the previous quarter, with a longer-term trend value of 22.1. This decline in the P/E ratio may indicate a shift in market sentiment, where investors are placing a lower premium on future earnings growth. A falling P/E ratio could be driven by slowing revenue growth, increased risk perception, or improved earnings performance that is outpacing stock price growth.
P/E Ratio
Source: MarketVectors.Pro, Adobe Financial Reports (TTM)
P/E Ratio
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🟢 EPS (Earnings Per Share, TTM)
Adobe's earnings per share (EPS) for the most recent quarter is 16.41 USD (+2.5%), compared to 16.01 USD in the previous quarter, with a longer-term trend value of 16.01 USD. This quarterly increase in EPS suggests improved profitability and operational efficiency.
EPS
Source: MarketVectors.Pro, Adobe Financial Reports (TTM, USD)
EPS
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🔴 P/B (Price to Book)
Price-to-book (P/B) ratio for the most recent quarter stands at 12.85 (-17.4%), compared to 15.55 in the previous quarter, with a long-term trend value of 12.55. This decline in the P/B ratio may indicate a more conservative market stance on the company’s asset valuation, potentially influenced by shifting investor sentiment, changes in financial fundamentals, or broader economic conditions.
P/B Ratio
Source: MarketVectors.Pro, Adobe Financial Reports
P/B Ratio
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🟢 EBIT
EBIT for Adobe in the most recent quarter is 2,173 million USD, compared to 2,109 million USD in the previous quarter, with a long-term trend value of 2,208 million USD. This increase reflects improved operational performance and higher profitability, aligning with the long-term growth trajectory.
EBIT
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
EBIT
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🟡 Risk Assessment
This risk assessment highlights the principal challenges and exposures that may affect Adobe Inc. in the execution of its strategy and day-to-day operations.
Market Risk
Adobe competes in highly dynamic markets where rapid technological change and new entrants could impact its market leadership. A slowdown in global IT spending or reduced corporate budgets for digital solutions may weaken demand for its subscription services. In addition, economic uncertainty in key regions such as North America and Europe could influence customer adoption rates.
Financial Risk
Although Adobe maintains strong revenues through its subscription model, reliance on recurring income exposes it to risks if renewal rates decline. Currency fluctuations can affect profitability given the company’s significant international presence. Furthermore, acquisitions to expand its product portfolio may increase financial leverage and integration risks.
Operational Risk
Adobe depends on the performance and security of its cloud infrastructure to deliver services globally. Cyber security threats and data breaches pose a substantial risk to customer trust and business continuity. The company’s growth also relies heavily on retaining top talent in a highly competitive technology labour market.
Regulatory Risk
Adobe must comply with data protection regulations such as GDPR in Europe and evolving privacy laws worldwide. Antitrust scrutiny and potential restrictions on large technology firms could impact its ability to pursue acquisitions or expand market share. Additionally, stricter ESG reporting obligations may increase compliance costs and administrative complexity.
Overall Risk Assessment
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🟡 Piotroski F-Score Analysis
Piotroski F-Score analysis is a robust methodology designed to assess the financial strength and operational efficiency of companies, providing valuable insights for investment decision-making.
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
| Previous TTM | Current TTM | Score | |
| Net Income | 5,360 | 6,957 | 1 |
| ROA | 18.11% | 23.78% | 1 |
| Net Operating Cash Flow | 575 | -2,236 | 0 |
| OCF > Net Income | 1,372 | 2,835 | 1 |
| Long-Term Debt | 14,027 | 22,650 | 0 |
| Current Ratio | 1.11 | 1.02 | 0 |
| New Shares Issued (mln) | 448 | 424 | 1 |
| Gross Margin | 88.66% | 89.14% | 1 |
| Total Asset Turnover Ratio | 0.71 | 0.79 | 1 |
| Piotroski F-Score | 6/9 |
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🟢 Altman Z-Score Analysis
Altman Z-Score is a widely recognised financial metric used to evaluate the risk of bankruptcy for companies. It is particularly relevant for assessing the creditworthiness of manufacturing and industrial companies but has also been adapted for other industries.
Source: MarketVectors.Pro, Adobe Financial Reports
| Q2 25 | |||
| Altman Z-Score (TTM) | 15.03 | ||
| 0 | Distress | 1.8 | Grey | 2.99 | Safe | 4 |
Source: MarketVectors.Pro, Adobe Financial Reports
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🔴 Key Assets Components
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
As of last quarter the company reported total assets of 28,754 million USD, reflecting a decrease of 3.6% compared to the previous year the same quarter 29,830 million USD. The largest contributor to this change in current assets was Receivables, which grew by 16.1% to 2,093 million USD from 1,802 million USD.
Assets
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
| Q2 24 | Q2 25 | Change (%) | |
| Cash & Short-Term Inv | 7,515 | 5,940 | -20.96% |
| Inventory | 0 | 0 | 0.00% |
| Receivables | 1,802 | 2,093 | 16.15% |
| Total Current Assets | 10,716 | 9,412 | -12.17% |
| Property and Equipment | 1,969 | 1,908 | -3.10% |
| Goodwill, Intangibles | 13,672 | 13,417 | -1.87% |
| Other Long-Term Assets | 1,557 | 1,618 | 3.92% |
| Total Assets | 29,830 | 28,754 | -3.61% |
Assets
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🔴 Key Liabilities & Equity
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Total current liabilities decreased by 4.2%, indicating a reduction in short-term obligations. This change may affect the company's ability to manage its working capital efficiently. Long-term debt increased by 50.2%, suggesting a rise in long-term obligations. This shift could have implications for the Adobe's financing costs and overall debt strategy.
Liabilities & Equity
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
| Q2 24 | Q2 25 | Change (%) | |
| Accounts Payable | 318 | 337 | 5.97% |
| Accrued Expenses, Other | 596 | 191 | -67.95% |
| Total Current Liabilities | 9,644 | 9,239 | -4.20% |
| Long-term Lease | 452 | 436 | -3.54% |
| Long-term Debt | 4,128 | 6,200 | 50.19% |
| Total Liabilities | 15,285 | 16,984 | 11.12% |
| Shareholders’ Equity | 14,545 | 11,770 | -19.08% |
Liabilities & Equity
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🟡 Income Statement Analysis
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
As of Q2 25, Adobe reported a revenue of 5,988 million USD, marking an increase of 10.7% compared to the previous year to 5,408 million USD. Operating expenses rose to 3,173 million USD, increasing by 4.6% year-on-year from 3,033 million USD.
Revenue & Net Income
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
| Q2 24 | Q2 25 | Change (%) | |
| Revenue | 5,408 | 5,988 | 10.72% |
| Operating Expenses | 3,033 | 3,173 | 4.62% |
| Operating Income | 1,992 | 2,173 | 9.09% |
| Net Income | 1,684 | 1,772 | 5.23% |
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Revenue & Net Income
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🟢 Cash Flow Analysis
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
The company’s cash flow performance over the year demonstrates varied trends across key categories. Net operating cash flows increased by 8.8% from 2,021 million USD to 2,198 million USD, reflecting stronger cash generation from core business activities. Net investing cash flows decreased by 493.6% from -47 million USD to -279 million USD, indicating higher expenditure on investments, potentially related to strategic initiatives.
Operating Cash Flow
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
| Q2 24 | Q2 25 | Change (%) | |
| Net Operating Cash Flows | 2,021 | 2,198 | 8.76% |
| Net Investing Cash Flows | -47 | -279 | -493.62% |
| Net Financing Cash Flows | -2,453 | -1,876 | 23.52% |
| Net Cash Flow, Equivalents | -479 | 43 | 108.98% |
Operating Cash Flow
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🟢 EBITDA
Adobe's EBITDA for the most recent quarter is 2,381 milion USD (+2.7%), compared to 2,318 milion USD in the previous quarter, with a long-term trend value of 2,422 milion USD. This increase in EBITDA suggests improved operational efficiency and revenue growth, indicating stronger core business performance.
EBITDA
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
EBITDA
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🟢 Net Income
Net income for the most recent quarter is 1,772 milion USD (+4.8%), compared to 1,691 milion USD in the previous quarter, with a long-term trend value of 1,820 milion USD. This increase in net income reflects improved profitability, potentially driven by higher revenue growth, enhanced cost efficiency, or favorable market conditions.
Net Income
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Net Income
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🟡 ROE (Return on Equity, %) ★ Buffett's Key Metric
Adobe's return on equity (ROE) for the most recent quarter is 59.1%, compared to 60.0% in the previous quarter, with a long-term trend value of 57.6%. This decline in ROE may indicate reduced profitability, increased equity base, or other financial challenges affecting the company's return on investment.
ROE Indicator
Source: MarketVectors.Pro, Adobe Financial Reports (%)
ROE Indicator
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🟡 ROA (Return on Assets, %)
Return on assets (ROA) for the most recent quarter is 24.2%, compared to 24.4% in the previous quarter, with a long-term trend value of 23.1%. This decline in ROA may indicate lower profitability, increased asset base, or operational inefficiencies affecting the company's ability to generate returns.
ROA Indicator
Source: MarketVectors.Pro, Adobe Financial Reports (%)
ROA Indicator
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🟢 Operating Margin (%) ★ Buffett's Key Metric
Adobe's operating margin for the most recent quarter is 36.3%, compared to 35.9% in the previous quarter, with a long-term trend value of 35.7%. This increase in operating margin reflects improved cost efficiency, higher revenue retention, or a stronger pricing strategy. The rise suggests that Adobe is effectively managing its operational expenses while maintaining revenue growth.
Operating Margin
Source: MarketVectors.Pro, Adobe Financial Reports (%)
Operating Margin
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🟢 Net Margin (%) ★ Buffett's Key Metric
Net margin for the most recent quarter is 29.6%, compared to 28.8% in the previous quarter, with a long-term trend value of 29.4%. This increase in net margin suggests improved profitability, reflecting stronger cost control, enhanced operational efficiency, or higher revenue retention. The company appears to be effectively managing expenses while maintaining revenue growth, contributing to improved bottom-line performance.
Net Margin
Source: MarketVectors.Pro, Adobe Financial Reports (%)
Net Margin
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🟡 Long-Term Debt & EBITDA
The current long-term debt is 6,200 million USD, and EBITDA is 2,381 million USD. The long-term debt to EBITDA ratio for the most recent quarter is 260.4%, compared to 266.0% in the previous quarter, with a long-term trend value of 256.2%. This decline in the long-term debt to EBITDA ratio suggests an improvement in the company's ability to manage and service its long-term debt obligations. The lower ratio indicates stronger financial flexibility, potentially driven by higher earnings generation or reduced leverage.
Long-Term Debt to EBITDA Ratio
Source: MarketVectors.Pro, Adobe Financial Reports (%)
Although the ratio has decreased, it is still within the monitoring range 250%–400%, suggesting that debt management should continue to be observed. A declining trend in this ratio is typically a positive sign for investors, as it implies reduced financial risk and an improved capacity to meet long-term liabilities.
Long-Term Debt & EBITDA
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Long-Term Debt to EBITDA Ratio
Although the ratio has decreased, it is still within the monitoring range 250%–400%, suggesting that debt management should continue to be observed. A declining trend in this ratio is typically a positive sign for investors, as it implies reduced financial risk and an improved capacity to meet long-term liabilities.
Long-Term Debt & EBITDA
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🟢 Long-Term Debt & Assets
The current long-term debt is 6,200 million USD, and total assets are 28,754 million USD, resulting in a debt ratio of 21.6%. This decline in the long-term debt-to-assets ratio indicates an improvement in financial stability, as the company is reducing its reliance on long-term debt relative to its total assets. This suggests either an increase in total assets or a reduction in outstanding long-term liabilities.
Long-Term Debt to Assets Ratio
Source: MarketVectors.Pro, Adobe Financial Reports (%)
The current level remains within the safe range <40%, reflecting a strong balance sheet and a conservative debt structure. A declining debt-to-assets ratio is generally seen as a positive signal for investors, as it implies lower financial risk and greater balance sheet resilience.
Long-Term Debt & Assets
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Long-Term Debt to Assets Ratio
The current level remains within the safe range <40%, reflecting a strong balance sheet and a conservative debt structure. A declining debt-to-assets ratio is generally seen as a positive signal for investors, as it implies lower financial risk and greater balance sheet resilience.
Long-Term Debt & Assets
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🟡 Long-Term Debt & Equity ★ Buffett's Key Metric
The current long-term debt is 6,200 million USD, while Total Equity stands at 11,770 million USD, resulting in a debt-to-equity ratio of 52.7%. This decline in the long-term debt-to-equity ratio suggests improved financial strength, as the company is reducing its reliance on debt financing relative to its equity base. This may be the result of increased retained earnings, debt repayments, or higher equity financing, all of which contribute to a healthier balance sheet.
Long-Term Debt to Equity Ratio
Source: MarketVectors.Pro, Adobe Financial Reports (%)
Although the ratio has decreased, it is still within the healthy range 50%–150%, suggesting that debt levels remain manageable and in line with industry standards. A declining debt-to-equity ratio is generally a positive signal for investors, reflecting reduced leverage and improved financial flexibility.
Long-Term Debt & Equity
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Long-Term Debt to Equity Ratio
Although the ratio has decreased, it is still within the healthy range 50%–150%, suggesting that debt levels remain manageable and in line with industry standards. A declining debt-to-equity ratio is generally a positive signal for investors, reflecting reduced leverage and improved financial flexibility.
Long-Term Debt & Equity
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🟡 Equity to Assets
The current equity is 11,770 million USD, while total assets stand at 28,754 million USD, resulting in an equity-to-assets ratio of 40.9%. This increase in the equity-to-assets ratio indicates a strengthening financial position, as the company is relying more on its own capital rather than external debt. The rise suggests higher retained earnings, new equity issuance, or asset appreciation, all of which contribute to long-term financial stability.
Equity to Assets Ratio
Source: MarketVectors.Pro, Adobe Financial Reports (%)
Although the ratio has increased, it is still within the monitoring range 40%–50%, suggesting that while financial leverage is moderate, continued assessment is recommended. A rising equity-to-assets ratio is generally a positive sign for investors, as it indicates lower financial risk and improved capital structure.
Equity & Assets
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Equity to Assets Ratio
Although the ratio has increased, it is still within the monitoring range 40%–50%, suggesting that while financial leverage is moderate, continued assessment is recommended. A rising equity-to-assets ratio is generally a positive sign for investors, as it indicates lower financial risk and improved capital structure.
Equity & Assets
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🟢 Quick Ratio
The quick ratio for Adobe is 1.02, compared to 0.99 in the previous quarter, with a long-term trend value of 0.99. This increase in the quick ratio suggests improved short-term liquidity, indicating that the company has a stronger ability to cover its immediate liabilities with liquid assets. The current level is above 1.0, which is considered financially healthy, demonstrating that the company maintains a solid liquidity position.
Quick Ratio
Source: MarketVectors.Pro, Adobe Financial Reports
Quick Ratio
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🟢 Current Ratio
The current ratio for Adobe is 1.02, compared to 0.99 in the previous quarter, with a long-term trend value of 0.99. This increase in the current ratio suggests improved liquidity, indicating that the company has a stronger ability to cover its short-term liabilities with current assets. Although the ratio has increased, it remains within the optimal range of 1.0–2.0, ensuring a healthy balance between liquidity and operational efficiency.
Current Ratio
Source: MarketVectors.Pro, Adobe Financial Reports
Current Ratio
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🟢 Net Working Capital
The net working capital (NWC) for Adobe in the most recent quarter is 173 million USD, compared to -61 million USD in the previous quarter, with a long-term trend value of 154 million USD.
Net Working Capital
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Net Working Capital
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🟢 Inventory Turnover Ratio
The inventory turnover ratio for Adobe is not available, as the company does not report inventory in its financial statements. This may indicate that Adobe operates in a service-based or software-driven industry, where inventory is not a significant component of operations.
Inventory Turnover Ratio
Source: MarketVectors.Pro, Adobe Financial Reports
Inventory Turnover Ratio
🔴 Asset Turnover Ratio
The assets turnover ratio for Adobe in the most recent quarter is 0.81, compared to 0.80 in the previous quarter. This increase in the assets turnover ratio indicates that Adobe is utilizing its assets more efficiently to generate revenue. A rising ratio often reflects improved sales performance, better assets utilization, or operational efficiency. The ratio has fallen below the 1.0, suggesting that Adobe may have a high level of assets relative to revenue generation. This could indicate underutilized resources or the need for improved asset efficiency.
Assets Turnover Ratio
Source: MarketVectors.Pro, Adobe Financial Reports
Assets Turnover Ratio
🔴 Book Value / Share
The book value per share (BVPS) is a key valuation metric that represents the equity value per outstanding share. Calculated by dividing total book value by the number of shares, it helps assess whether a stock trades above or below its book value.
Source: MarketVectors.Pro, Adobe Financial Reports (USD)
Book Value per Share Valuation
Source: MarketVectors.Pro, Adobe Financial Reports (USD, generated on 11 September 2025)
| Q2 24 | Q2 25 | Change (%) | |
| Book Value / Share | 32.47 | 27.76 | -14.51 % |
Book Value per Share Valuation
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🟢 Graham Method
The intrinsic value of Adobe’s stock is calculated using Benjamin Graham’s formula, which takes into account the current earnings per share (EPS) and an assumed growth rate (g), providing a simplified yet insightful perspective on a company’s value.
Benjamin Graham Valuation
Source: MarketVectors.Pro, Adobe Financial Reports (USD, generated on 11 September 2025)
Benjamin Graham Valuation
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🟡 Discounted Cash Flow ★ Buffett's Key Metric
The discounted cash flow (DCF) method is used to estimate Adobe’s intrinsic value by projecting future cash flows and discounting them to their present value. This approach considers the company’s potential to generate cash flows in the future, taking into account the time value of money and associated risks.
The terminal value represents the value of Adobe’s cash flows beyond the five-year forecast horizon. It is calculated using the Gordon Growth Model, assuming a perpetual growth rate of 2.0% and WACC of 11.2%. The calculated terminal value is 170,457 million USD.
Total Intrinsic Value Calculations
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Assuming 424 million shares outstanding, the intrinsic value per share is approximately 340.64 USD. The current market price of Adobe’s stock is 350.63 USD. Discounted cash flow valuation indicates that the stock is 2.9% overvalued, trading above its intrinsic value.
Discounted Cash Flow Valuation
Source: MarketVectors.Pro, Adobe Financial Reports (USD, generated on 11 September 2025)
| Value | |
| Present Value of FCFs | 44,180 |
| Present Value of Terminal Value | 100,252 |
| Total Intrinsic Value | 144,432 |
Discounted Cash Flow Valuation
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🟢 Assets Correlation
The Pearson correlation analysis for Adobe examines the relationship between share price and key financial indicators. Gross profit has a correlation of 0.89, which indicates a strong relationship, meaning profitability is a key driver of stock price movements. Operating income is correlated at 0.88, highlighting a strong relationship between operating profitability and market valuation.
Source: MarketVectors.Pro, Adobe Financial Reports
Current liabilities are correlated at 0.88, implying that short-term obligations are closely monitored by investors, influencing stock valuation. Total assets have a correlation of 0.94, confirming a strong relationship between asset growth and market performance.
Key Financial Indicators Growth Dynamics
Source: MarketVectors.Pro, Adobe Financial Reports, Index=100 on Q4 10
| Pearson Correlation | |
| Share Price | 1 |
| Gross Profit | 0.89 |
| Operating Income | 0.88 |
| Current Liabilities | 0.88 |
| Total Assets | 0.94 |
Key Financial Indicators Growth Dynamics
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🟡 FCF Margin Scenarios
• Optimistic Scenario: 54%, driven by operational efficiencies and cost optimisation.
• Base Case: 41% of revenue, consistent with historical trends.
• Pessimistic Scenario: 29%, reflecting higher operating and labour costs. Impact of Changes in FCF Margin
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
An approximately 13-percentage-point increase in the FCF margin to 54%, results in an additional 2,919 milion USD in FCF, highlighting the critical role of operational efficiency. Conversely, a decrease to 29% reduces FCF by 2,877 milion USD, illustrating the significant impact of profitability on cash flow generation.
Projected FCF Margin Scenarios Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
• Base Case: 41% of revenue, consistent with historical trends.
• Pessimistic Scenario: 29%, reflecting higher operating and labour costs. Impact of Changes in FCF Margin
| FCF Margin (%) | Revenue TTM | FCF TTM | Difference | |
| Optimistic | 54% | 23,181 | 12,518 | 2,919 |
| Base Case | 41% | 23,181 | 9,599 | – |
| Pessimistic | 29% | 23,181 | 6,722 | -2,877 |
Projected FCF Margin Scenarios Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
🟡 Operating Costs Scenarios
• Optimistic Scenario: 62%, reflecting enhanced efficiency and lower costs.
• Base Case: 64% of revenue, aligned with historical trends and cost structures.
• Pessimistic Scenario: 66%, driven by rising wages and increased energy costs. Impact of Changes in FCF Margin
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Reducing operational costs to 62% of revenue leads to a 407 milion USD increase in operating profit, emphasising the significance of cost control in enhancing margins. Increasing costs to 66% of revenue results in a 520 milion USD decline in operating profit, highlighting the sensitivity of profitability to rising expenses.
Projected Operating Costs Scenarios Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
• Base Case: 64% of revenue, aligned with historical trends and cost structures.
• Pessimistic Scenario: 66%, driven by rising wages and increased energy costs. Impact of Changes in FCF Margin
| Operating Costs (%) | Revenue TTM | Operating Profit | Difference | |
| Optimistic | 62% | 23,181 | 8,809 | 407 |
| Base Case | 64% | 23,181 | 8,402 | – |
| Pessimistic | 66% | 23,181 | 7,882 | -520 |
Projected Operating Costs Scenarios Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
🟡 Revenue Growth Scenarios
Optimistic Scenario: Projected to grow by 16% annually, driven by:
• Robust macroeconomic conditions.
• Strong industry growth with minimal disruptions.
• Favorable regulatory and competitive environment. Base Case: Projected to grow by 13% annually, driven by: • Stable macroeconomic conditions.
• Balanced market growth with manageable risks.
• Limited external disruptions from regulation or supply chains. Pessimistic Scenario: Projected to grow by 11% annually, driven by: • Global economic uncertainty and potential downturn.
• Increased competition and rising operational costs.
• Regulatory and supply chain challenges impacting business operations.
Source: MarketVectors.Pro, Adobe Financial Reports (million USD, TTM)
The projected revenue for the next twelve months varies depending on the scenario. Under the optimistic scenario, revenue is expected to increase by 16% to 26,871 million USD, reflecting strong market growth and operational efficiency. In the base case scenario, revenue is forecasted to grow by 13% to 26,256 million USD, assuming stable economic conditions and consistent business expansion. However, under the pessimistic scenario, revenue is projected to increase by 11% to 25,641 million USD, reflecting potential economic slowdowns or adverse market conditions.
Projected Revenues Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
The variation between projected scenarios highlights the Adobe's ability to perform across a range of market conditions. The growth even in the pessimistic case reflects a degree of resilience and suggests a strong underlying business model. This outlook supports confidence in management’s ability to navigate uncertainty while sustaining forward momentum. Scenario analysis enhances strategic visibility, helping stakeholders understand the potential bandwidth of future results.
• Strong industry growth with minimal disruptions.
• Favorable regulatory and competitive environment. Base Case: Projected to grow by 13% annually, driven by: • Stable macroeconomic conditions.
• Balanced market growth with manageable risks.
• Limited external disruptions from regulation or supply chains. Pessimistic Scenario: Projected to grow by 11% annually, driven by: • Global economic uncertainty and potential downturn.
• Increased competition and rising operational costs.
• Regulatory and supply chain challenges impacting business operations.
| Revenue | Net Income | Revenue (Next) | Net Income (Next) | |
| Optimistic | 23,181 | 6,957 | 26,871 | 8,064 |
| Base Case | 23,181 | 6,957 | 26,256 | 7,880 |
| Pessimistic | 23,181 | 6,957 | 25,641 | 7,695 |
Projected Revenues Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
The variation between projected scenarios highlights the Adobe's ability to perform across a range of market conditions. The growth even in the pessimistic case reflects a degree of resilience and suggests a strong underlying business model. This outlook supports confidence in management’s ability to navigate uncertainty while sustaining forward momentum. Scenario analysis enhances strategic visibility, helping stakeholders understand the potential bandwidth of future results.
🟡 Net Income Growth Scenarios
The projected net income for the next twelve months varies depending on the scenario. Under the optimistic scenario, net income is expected to increase by 16% to 8,064 million USD, reflecting improved profitability and strong financial performance. In the base case scenario, net income is forecasted to grow by 13% to 7,880 million USD, assuming stable market conditions and effective cost management. However, under the pessimistic scenario, net income is projected to increase by 11% to 7,695 million USD, reflecting potential challenges such as higher operational costs or slowing revenue growth.
Projected Net Income Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
The projected resilience in net income across all scenarios suggests a stable underlying profitability profile. Even under adverse assumptions, the Adobe is expected to maintain earnings growth, indicating effective cost controls and strong core operations. This consistency can help support valuation multiples and reduce perceived investment risk. Scenario modeling enhances transparency and strengthens the credibility of financial forecasting in the eyes of stakeholders.
Projected Net Income Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
The projected resilience in net income across all scenarios suggests a stable underlying profitability profile. Even under adverse assumptions, the Adobe is expected to maintain earnings growth, indicating effective cost controls and strong core operations. This consistency can help support valuation multiples and reduce perceived investment risk. Scenario modeling enhances transparency and strengthens the credibility of financial forecasting in the eyes of stakeholders.
🟡 Financial Performance Overview
Adobe demonstrated stronger financial performance in the most recent period, reflecting strong revenue growth, operational efficiency, and profitability improvements revenue increased by 10.7% year-over-year, reaching 5,988 million USD, supported by strong sales performance across all key markets. At the same time, EBITDA grew by 8.0% year-over-year, totaling 2,381 million USD, driven by cost optimization and higher-margin business segments.
Revenue & Net Income
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Notably, net income surged by 5.2% year-over-year, reaching 1,772 million USD, improving Adobe's net margin, which expanded to 29.6%. This growth reflects effective expense control and revenue expansion, strengthening the company’s bottom-line performance.
Revenue & Net Income
Notably, net income surged by 5.2% year-over-year, reaching 1,772 million USD, improving Adobe's net margin, which expanded to 29.6%. This growth reflects effective expense control and revenue expansion, strengthening the company’s bottom-line performance.
Key Performance Indicators (KPIs)
Source: MarketVectors.Pro, Adobe Financial Reports (YoY)
Valuation & Market Position
Adobe’s valuation metrics indicate a strengthened financial standing. The EV to EBITDA (TTM) ratio currently stands at 17.54, decreasing from 20.82, reflecting a dual shift – rising operational performance and declining market valuation. This indicates a balanced valuation, with stable investor perception
EV to EBITDA Ratio
Source: MarketVectors.Pro, Adobe Financial Reports (TTM)
The EV to EBITDA trendline illustrates Adobe’s valuation trajectory, with a declining enterprise value despite improving earnings, possibly signaling undervaluation or market pessimism.
Source: MarketVectors.Pro, Adobe Financial Reports (TTM)
Meanwhile, the P/E (Price to Earnings) ratio has declined to 21.7, down from 41.8 a year ago, potentially signaling a more balanced market outlook on Adobe’s earnings potential. The P/S (Price to Sales) ratio has declined to 6.52, compared to 10.80 a year ago, suggesting a more conservative valuation stance among investors.
| Change (%) | |
| Revenue Growth | 10.7% |
| EBITDA Growth | 8.0% |
| Net Income Growth | 5.2% |
| Net Margin | 29.6% |
| EPS | 37.1% |
EV to EBITDA Ratio
The EV to EBITDA trendline illustrates Adobe’s valuation trajectory, with a declining enterprise value despite improving earnings, possibly signaling undervaluation or market pessimism.
| Ratio (TTM) | |
| EV/EBITDA | 17.54 |
| P/E Ratio | 21.37 |
| P/S Ratio | 6.52 |
Cash Flow & Liquidity ★ Buffett's Key Metric
Adobe is experiencing a weakened cash flow position, reflecting potential liquidity challenges. The decline in cash flow may indicate increased operational costs or reduced cash inflows, requiring closer financial monitoring and strategic adjustments.
• Free Cash Flow (FCF) – totaled 2,126 million USD, indicating a decline in available cash resources, requiring enhanced financial oversight.
• Net Operating Cash Flow – declined by 488.9% year-over-year, reaching -2,236 million USD, suggesting weaker cash inflows from operating activities.
• Long-term debt – increased by 61.5%, which may lead to higher financial leverage and increased interest obligations.
Adobe’s ability to generate declining cash flow while increasing debt reinforces its financial flexibility, though ongoing financial management is essential to sustain long-term growth and strategic investments.
Free Cash Flow
Source: MarketVectors.Pro, Adobe Financial Reports (million USD)
Adobe's financial performance in the most recent quarter shows that EBITDA reached 2,381 million USD, reflecting improved operational efficiency and earnings growth. The company's return on equity (ROE) is 59.1%, pointing to reduced return on shareholder capital and weaker financial performance. The long-term debt-to-equity ratio stands at 52.7%, indicating a more resilient balance sheet and lower financial risk. The quick ratio is 1.02, showing improved liquidity and better short-term risk coverage. The EV/EBITDA ratio is currently 17.54x, reflecting a balanced or attractive valuation level relative to earnings. Overall, Adobe’s financial health remains strong, with consistent revenue expansion, rising operational costs, and strong liquidity. Meanwhile, the P/E ratio is declining, while Adobe’s long-term prospects remain positive.
Free Cash Flow
Adobe's financial performance in the most recent quarter shows that EBITDA reached 2,381 million USD, reflecting improved operational efficiency and earnings growth. The company's return on equity (ROE) is 59.1%, pointing to reduced return on shareholder capital and weaker financial performance. The long-term debt-to-equity ratio stands at 52.7%, indicating a more resilient balance sheet and lower financial risk. The quick ratio is 1.02, showing improved liquidity and better short-term risk coverage. The EV/EBITDA ratio is currently 17.54x, reflecting a balanced or attractive valuation level relative to earnings. Overall, Adobe’s financial health remains strong, with consistent revenue expansion, rising operational costs, and strong liquidity. Meanwhile, the P/E ratio is declining, while Adobe’s long-term prospects remain positive.
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