Adobe Delivers Record Q1 Results

• Record Q1 Operating Cash Flows of $2.48 billion
• Reaffirms FY2025 Targets
• Previews Customer-Focused Strategy Ahead of Its Investor Meeting at Adobe Summit

SAN JOSE, Calif.: Adobe (Nasdaq:ADBE) today reported financial results for its first quarter fiscal year 2025 ended Feb. 28, 2025, reaffirming its FY2025 targets, and previewed its customer-focused strategy ahead of Adobe’s Investor Meeting next week at Adobe Summit.

“Adobe’s success over the next decade will be driven by customer-focused innovation and new offerings for creators, marketing professionals, business professionals and consumers,” said Shantanu Narayen, chair and CEO, Adobe. “Adobe is well-positioned to capitalize on the acceleration of the creative economy driven by AI and we are reaffirming our FY2025 financial targets.”

“Our continued innovation and diversified go-to-market strategy drove a record Q1, with new AI-first standalone and add-on innovations exiting the quarter with over $125 million ending ARR book of business,” said Dan Durn, executive vice president and CFO, Adobe. “Our customer- focused strategy, leading product portfolio and strong cash flow position us for sustainable long-term growth and increased market share.”

First Quarter Fiscal Year 2025 Financial Highlights

• Adobe achieved record revenue of $5.71 billion in its first quarter of fiscal year 2025, which represents 10 percent year-over-year growth, or 11 percent in constant currency. Diluted earnings per share was $4.14 on a GAAP basis and $5.08 on a non-GAAP basis.
• GAAP operating income in the first quarter was $2.16 billion and non-GAAP operating income was $2.72 billion. GAAP net income was $1.81 billion and non-GAAP net income was $2.22 billion.
• Cash flows from operations were $2.48 billion.
• Exiting the quarter, Remaining Performance Obligations (“RPO”) were $19.69 billion, and Current Remaining Performance Obligations (“cRPO”) were 67 percent.
• Adobe repurchased approximately 7.0 million shares during the quarter.

First Quarter Fiscal Year 2025 Business Segment Highlights

• Digital Media segment revenue was $4.23 billion, which represents 11 percent year-over-year growth, or 12 percent in constant currency. Digital Media Annualized Recurring Revenue (“ARR”) exiting the quarter was $17.63 billion, representing 12.6 percent year-over-year growth.
• Digital Experience segment revenue was $1.41 billion, representing 10 percent year-over-year growth as reported and in constant currency. Digital Experience subscription revenue was $1.30 billion, representing 11 percent year-over-year growth as reported and in constant currency.

Supplemental Disclosure for Customer Groups

Adobe will now disclose subscription revenue by both “Business Professionals and Consumers” and “Creative and Marketing Professionals” to provide additional insight. Business Professionals and Consumers Group will consist of all subscription revenue from Document Cloud, Acrobat subscription revenue in Creative Cloud, and Adobe Express subscription revenue in Creative Cloud, all of which are part of Digital Media. Creative and Marketing Professionals Group will consist of all subscription revenue from Digital Experience as well as all of the remaining subscription revenue from Creative Cloud in Digital Media.

• Business Professionals and Consumers Group subscription revenue was $1.53 billion, which represents 15 percent year-over-year growth.
• Creative and Marketing Professionals Group subscription revenue was $3.92 billion, which represents 10 percent year-over-year growth.

Financial Targets

The following table summarizes Adobe’s second quarter fiscal year 2025 targets1:

The following table summarizes Adobe’s fiscal year 2025 targets, which assumes current macroeconomic conditions2:

Adobe to Host Conference Call

Adobe will webcast its first quarter fiscal year 2025 earnings conference call today at 2:00 p.m. Pacific Time from its investor relations website: http://www.adobe.com/ADBE. Earnings documents, including Adobe management’s prepared conference call remarks with slides and an investor datasheet are posted to Adobe’s Investor Relations Website in advance of the conference call for reference.

Adobe to Host Investor Meeting at Adobe Summit 2025

Adobe will host its Investor Meeting with financial analysts and investors on Tuesday, March 18, 2025 at 2:00 p.m. Pacific Time at Adobe Summit in Las Vegas, Nevada. Adobe’s executive team will provide updates on Adobe’s strategy, innovation roadmap, market opportunity and financials. The event will be streamed live on the Adobe Investor Relations Website. Following the event, a recording and related materials will be available on the site.

Forward-Looking Statements, Non-GAAP and Other Disclosures

In addition to historical information, this press release contains “forward-looking statements” within the meaning of applicable securities laws, including statements related to our business, strategy, artificial intelligence and innovation momentum; our market opportunity and future growth; market trends; current macroeconomic conditions; fluctuations in foreign currency exchange rates; strategic investments; customer success and groups; revenue; operating margin; annualized recurring revenue; tax rate; earnings per share; and share count. Each of the forward-looking statements we make in this press release involves risks, uncertainties and assumptions based on information available to us as of the date of this press release. Such risks and uncertainties, many of which relate to matters beyond our control, could cause actual results to differ materially from these forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to: failure to innovate effectively and meet customer needs; issues relating to development and use of AI; failure to realize the anticipated benefits of investments or acquisitions; failure to compete effectively; damage to our reputation or brands; service interruptions or failures in information technology systems by us or third parties; security incidents; failure to effectively develop, manage and maintain critical third-party business relationships; risks associated with being a multinational corporation and adverse macroeconomic conditions; failure to recruit and retain key personnel; complex sales cycles; changes in, and compliance with, global laws and regulations, including those related to information security and privacy; failure to protect our intellectual property; litigation, regulatory inquiries and intellectual property infringement claims; changes in tax regulations; complex government procurement processes; risks related to fluctuations in or the timing of revenue recognition from our subscription offerings; fluctuations in foreign currency exchange rates; impairment charges; our existing and future debt obligations; catastrophic events; and fluctuations in our stock price. Further information on these and other factors are discussed in the section titled “Risk Factors” in Adobe’s most recently filed Annual Report on Form 10-K and Adobe's most recently filed Quarterly Reports on Form 10-Q. The risks described in this press release and in Adobe’s filings with the U.S. Securities and Exchange Commission should be carefully reviewed.

Undue reliance should not be placed on the financial information set forth in this press release, which reflects estimates based on information available at this time. These amounts could differ from actual reported amounts stated in Adobe’s Quarterly Report on Form 10-Q for our fiscal quarter ended Feb. 28, 2025, which Adobe expects to file in March 2025. Adobe assumes no obligation to, and does not currently intend to, update these forward-looking statements.

A reconciliation between GAAP and non-GAAP earnings results and financial targets and a statement regarding use of non-GAAP financial information are provided at the end of this press release and on Adobe’s investor relations website.

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