Adobe Reports Q3 2025 Earnings with $5.99B Revenue
Adobe (NASDAQ: ADBE) announced its financial results for the third quarter of 2025, reporting revenue of $5.99 billion and earnings of $5.31 per share.
Analysts had anticipated revenue of $5.91 billion and earnings of $5.18 per share, indicating a year-over-year growth of approximately 9% in revenue and 11% in EPS.
Adobe exceeded Wall Street expectations and raised its full-year guidance for both revenue and earnings.
The company achieved record quarterly revenue of $5.99 billion, an 11% increase year-over-year, with non-GAAP earnings per share of $5.31. GAAP net income was $1.77 billion, while non-GAAP net income reached $2.25 billion.
Adobe concluded the quarter with Remaining Performance Obligations (RPO) of $20.44 billion, up 13% year-over-year, with current RPO at 67%. Operating cash flow was $2.20 billion, and Adobe repurchased approximately 8 million shares during the quarter.
In terms of business segments, Digital Media revenue rose to $4.46 billion, up 12% year-over-year, with Digital Media ARR increasing to $18.59 billion. Digital Experience revenue reached $1.48 billion, up 9% year-over-year, with subscription revenue in that segment climbing 11% to $1.37 billion.
Adobe has revised its full-year fiscal 2025 outlook, now targeting revenue of $23.65 to $23.70 billion and non-GAAP EPS of $20.80 to $20.85.
Adobe's shares remained stable in Thursday's trading session, closing at $350.55. The stock has risen by around 5% over the past month but has declined significantly over the past year, down 21% this year and nearly 40% from its 52-week high, as investors express skepticism about the monetization pace of its AI tools and concerns about rising competition from Canva, Figma (NYSE: FIG), and Autodesk (NASDAQ: ADSK).
Wall Street analysts have become more cautious as well. Oppenheimer reduced its price target on Adobe this week from $500 to $460 while maintaining an “Outperform” rating, warning that the company's rollout of generative AI tools has yet to lead to significant revenue growth.
Melius Research has adopted a more bearish stance, downgrading Adobe to “Sell” and cutting its target to $310 from $400 over the summer, citing intensifying competition from emerging AI-driven design platforms such as Canva and Figma and growing concerns about the sustainability of Adobe’s long-term growth engine.
Adobe will hold its Q3 FY2025 earnings call at 5:00 PM Eastern.
Analysts are seeking clearer signals from management on how quickly generative AI tools like Firefly and Acrobat AI Assistant are converting into paid subscriptions and ARR, the impact of AI investment on margins, and how Adobe plans to defend its creative software dominance against rising competition from Figma, Canva, and others.
Commentary on enterprise demand, Digital Experience momentum, and fourth-quarter guidance will also be closely monitored as investors evaluate whether Adobe can reignite long-term growth.