Adobe Raises FY25 Digital Media ARR Growth, Total Revenue, and EPS Targets
Adobe (Nasdaq:ADBE) today reported financial results for its third quarter fiscal year 2025 ended Aug. 29, 2025. “Adobe is the leader in the AI creative applications category with AI-influenced ARR ...
Company Reports Record Revenue and RPO Surpasses $20 Billion, Accelerating to 13 Percent Year-Over-Year Growth
SAN JOSE, Calif.: Adobe (Nasdaq:ADBE) today reported financial results for its third quarter fiscal year 2025 ended Aug. 29, 2025.
“Adobe is the leader in the AI creative applications category with AI-influenced ARR surpassing $5 billion and AI-first ARR already exceeding our $250 million year-end target,” said Shantanu Narayen, chair and CEO, Adobe. “Given our customer strategy, AI product innovation and strong go-to-market execution, we’re pleased to once again raise our FY25 total revenue and EPS targets.”
“Adobe delivered record Q3 revenue, with strength in subscription revenue across both Digital Media and Digital Experience segments,” said Dan Durn, executive vice president and CFO, Adobe. “We’re raising our FY25 total revenue and EPS targets as we execute against our growth strategy to deliver category leading and AI-infused solutions to meet the diverse needs of our customers.”
Third Quarter Fiscal Year 2025 Financial Highlights
- Adobe achieved record revenue of $5.99 billion in its third quarter of fiscal year 2025, which represents 11 percent year-over-year growth, or 10 percent in constant currency. Diluted earnings per share was $4.18 on a GAAP basis and $5.31 on a non-GAAP basis.
- GAAP operating income in the third quarter was $2.17 billion and non-GAAP operating income was $2.77 billion. GAAP net income was $1.77 billion and non-GAAP net income was $2.25 billion.
- Cash flows from operations were $2.20 billion.
- Exiting the quarter, Remaining Performance Obligations (“RPO”) were $20.44 billion, and Current Remaining Performance Obligations (“cRPO”) were 67 percent.
- Adobe repurchased approximately 8.0 million shares during the quarter.
Third Quarter Fiscal Year 2025 Business Segment Highlights
- Digital Media segment revenue was $4.46 billion, which represents 12 percent year-over-year growth, or 11 percent in constant currency. Digital Media Annualized Recurring Revenue (“ARR”) exiting the quarter was $18.59 billion, representing 11.7 percent year-over-year growth.
- Digital Experience segment revenue was $1.48 billion, representing 9 percent year-over-year growth as reported and in constant currency. Digital Experience subscription revenue was $1.37 billion, representing 11 percent year-over-year growth as reported and in constant currency.
Customer Group Supplemental Disclosure
- Business Professionals and Consumers Group subscription revenue was $1.65 billion, which represents 15 percent year-over-year growth, or 14 percent in constant currency.
- Creative and Marketing Professionals Group subscription revenue was $4.12 billion, which represents 11 percent year-over-year growth, or 10 percent in constant currency.
Financial Targets
The following table summarizes Adobe’s fourth quarter fiscal year 2025 targets, which assumes current macroeconomic conditions1:
Total revenue | $6.075 billion to $6.125 billion | |
Digital Media segment revenue | $4.53 billion to $4.56 billion | |
Digital Experience segment revenue | $1.495 billion to $1.515 billion | |
Digital Experience subscription revenue | $1.395 billion to $1.410 billion | |
Earnings per share | GAAP: $4.27 to $4.32 | Non-GAAP: $5.35 to $5.40 |
1 Targets assume non-GAAP operating margin of ~45.5 percent, non-GAAP tax rate of ~18.5 percent and diluted share count of ~418 million for fourth quarter fiscal year 2025. | ||
The following updated table summarizes Adobe’s fiscal year 2025 targets, which assumes current macroeconomic conditions2:
Total revenue | $23.65 billion to $23.70 billion | |
Digital Media segment revenue | $17.56 billion to $17.59 billion | |
Digital Media ending ARR growth | 11.3% year over year | |
Digital Experience segment revenue | $5.84 billion to $5.86 billion | |
Digital Experience subscription revenue | $5.39 billion to $5.41 billion | |
Earnings per share | GAAP: $16.53 to $16.58 | Non-GAAP: $20.80 to $20.85 |
2 Targets assume non-GAAP operating margin of ~46 percent, non-GAAP tax rate of ~18.5 percent and diluted share count of ~427 million for fiscal year 2025. | ||
Adobe to Host Conference Call
Adobe will webcast its third 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.
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 (“AI”) and innovation momentum; our market and AI opportunity and future growth; market and AI trends; current macroeconomic conditions; fluctuations in foreign currency exchange rates; strategic investments; customer success and groups; and our financial targets and assumptions related thereto, including revenue, operating margin, operating efficiencies, 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 compete effectively; damage to our reputation or brands; failure to realize the anticipated benefits of investments or acquisitions; 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; complex sales cycles; failure to recruit and retain key personnel; litigation, regulatory inquiries and intellectual property infringement claims; changes in, and compliance with, global laws and regulations, including those related to information security and privacy; failure to protect our intellectual property; 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 forward-looking 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 Aug. 29, 2025, which Adobe expects to file in Sept. 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. Definitions of our non-GAAP financial measures are provided in the Current Report on Form 8-K relating to this press release.
About Adobe
Adobe is changing the world through personalized digital experiences. For more information, visit www.adobe.com.
©2025 Adobe. All rights reserved. Adobe and the Adobe logo are either registered trademarks or trademarks of Adobe (or one of its subsidiaries) in the United States and/or other countries. All other trademarks are the property of their respective owners.
Condensed Consolidated Statements of Income | ||||||||||||||||
(In millions, except per share data; unaudited) | ||||||||||||||||
| Three Months Ended |
| Nine Months Ended | |||||||||||||
| August 29, 2025 |
| August 30, 2024 |
| August 29, 2025 |
| August 30, 2024 | |||||||||
Revenue: |
|
|
|
|
|
|
| |||||||||
Subscription | $ | 5,791 |
|
| $ | 5,180 |
|
| $ | 16,915 |
|
| $ | 15,156 |
| |
Product |
| 68 |
|
|
| 82 |
|
|
| 251 |
|
|
| 305 |
| |
Services and other |
| 129 |
|
|
| 146 |
|
|
| 409 |
|
|
| 438 |
| |
Total revenue |
| 5,988 |
|
|
| 5,408 |
|
|
| 17,575 |
|
|
| 15,899 |
| |
|
|
|
|
|
|
|
| |||||||||
Cost of revenue: |
|
|
|
|
|
|
| |||||||||
Subscription |
| 510 |
|
|
| 413 |
|
|
| 1,505 |
|
|
| 1,324 |
| |
Product |
| 5 |
|
|
| 6 |
|
|
| 17 |
|
|
| 19 |
| |
Services and other |
| 127 |
|
|
| 135 |
|
|
| 380 |
|
|
| 399 |
| |
Total cost of revenue |
| 642 |
|
|
| 554 |
|
|
| 1,902 |
|
|
| 1,742 |
| |
|
|
|
|
|
|
|
| |||||||||
Gross profit |
| 5,346 |
|
|
| 4,854 |
|
|
| 15,673 |
|
|
| 14,157 |
| |
|
|
|
|
|
|
|
| |||||||||
Operating expenses: |
|
|
|
|
|
|
| |||||||||
Research and development |
| 1,088 |
|
|
| 1,022 |
|
|
| 3,196 |
|
|
| 2,945 |
| |
Sales and marketing |
| 1,639 |
|
|
| 1,431 |
|
|
| 4,760 |
|
|
| 4,228 |
| |
General and administrative |
| 408 |
|
|
| 366 |
|
|
| 1,152 |
|
|
| 1,073 |
| |
Acquisition termination fee |
| — |
|
|
| — |
|
|
| — |
|
|
| 1,000 |
| |
Amortization of intangibles |
| 38 |
|
|
| 43 |
|
|
| 120 |
|
|
| 127 |
| |
Total operating expenses |
| 3,173 |
|
|
| 2,862 |
|
|
| 9,228 |
|
|
| 9,373 |
| |
|
|
|
|
|
|
|
| |||||||||
Operating income |
| 2,173 |
|
|
| 1,992 |
|
|
| 6,445 |
|
|
| 4,784 |
| |
|
|
|
|
|
|
|
| |||||||||
Non-operating income (expense): |
|
|
|
|
|
|
| |||||||||
Interest expense |
| (67 | ) |
|
| (51 | ) |
|
| (197 | ) |
|
| (119 | ) | |
Investment gains (losses), net |
| 23 |
|
|
| 12 |
|
|
| 31 |
|
|
| 34 |
| |
Other income (expense), net |
| 58 |
|
|
If you liked this article and want to stay up to date with news from
InnovationOpenLab.com subscribe to ours
Free newsletter.
Related news
Last NewsRSA at Cybertech Europe 2024Alaa Abdul Nabi, Vice President, Sales International at RSA presents the innovations the vendor brings to Cybertech as part of a passwordless vision for… Italian Security Awards 2024: G11 Media honours the best of Italian cybersecurityG11 Media's SecurityOpenLab magazine rewards excellence in cybersecurity: the best vendors based on user votes How Austria is making its AI ecosystem growAlways keeping an European perspective, Austria has developed a thriving AI ecosystem that now can attract talents and companies from other countries Sparkle and Telsy test Quantum Key Distribution in practiceSuccessfully completing a Proof of Concept implementation in Athens, the two Italian companies prove that QKD can be easily implemented also in pre-existing… Most readDeepgram Brings Low-Latency Speech Recognition and TTS to Amazon ConnectDeepgram, the world’s most realistic and real-time Voice AI platform, today announced integration of its enterprise-grade speech-to-text (STT) and text-to-speech… Deepgram Launches Streaming Speech, Text, and Voice Agents on Amazon SageMaker…Deepgram, the world’s most realistic and real-time Voice AI platform, today announced native integration with Amazon SageMaker AI, delivering streaming,… Global Payments to Present at UBS Global Technology and AI Conference#globalpayments--Global Payments Inc. (NYSE: GPN), a leading worldwide provider of payment technology and software solutions, announced today that Cameron… PAR Technology Corporation to Participate at UBS Global Technology and…PAR Technology Corporation (NYSE: PAR) a leading global provider of technology to enterprise foodservice and retail, today announced that Savneet Singh,… G11 Media Networks
InnovationOpenLab is a channel of BitCity, a newspaper registered at the court of Como , 
| |||||||||||