10-Q · June 15, 2026
Adobe reported strong Q2 results for fiscal 2026 with revenues of $6.62 billion, marking a 13% increase year-over-year, and surpassing estimates. EPS came in at $5.96, exceeding the consensus of $5.60, while total…
Earnings analysis · 10-Q
ADBE earnings analysis
Filed September 22, 2026 · Our reading of the company's report
The latest report
Adobe delivered a strong Q3, with revenue of $6.76 billion and EPS of $6.13 beating consensus and increasing materially versus both Q2 and the prior-year quarter. AI-first ARR growth of more than 150% and $2.52 billion…
Read full summary
Adobe delivered a strong Q3, with revenue of $6.76 billion and EPS of $6.13 beating consensus and increasing materially versus both Q2 and the prior-year quarter. AI-first ARR growth of more than 150% and $2.52 billion of operating cash flow were positive operating signals. The principal risks are intensifying AI competition, regulatory and compliance costs, global operating exposure and $6.40 billion of reported debt and commercial paper outstanding.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $6.13
What stood out
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Record revenue beat estimates
Q3 revenue reached $6.76 billion, up approximately 2.1% from $6.62 billion in Q2 and 12.9% from $5.99 billion in the prior-year quarter. Revenue also exceeded the $6.70 billion consensus estimate.
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EPS materially exceeded consensus
Reported diluted EPS was $6.13, up 44.2% from $4.25 in Q2 and 46.7% from $4.18 a year earlier, exceeding the $5.84 consensus estimate by $0.29.
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AI ARR growth accelerated
AI-first ARR grew more than 150% year over year, indicating accelerating adoption of Adobe’s AI offerings despite heightened competition and monetization uncertainty.
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Strong cash generation and buybacks
Operating cash flow reached $2.52 billion in Q3, supporting continued investment and shareholder returns; Adobe repurchased 9.5 million shares during the quarter.
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Liquidity remains available
Adobe had $1.5 billion of undrawn revolving credit capacity at August 28, 2026, providing additional liquidity alongside operating cash flow.
What to watch
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Meaningful debt obligations
Adobe reported $6.15 billion of senior unsecured notes and $250 million outstanding under its $3 billion commercial paper program as of August 28, 2026. Debt service could constrain cash available for capital expenditures, acquisitions and other purposes.
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AI cost and regulatory execution risk
The filing identifies AI innovation, adoption and monetization as material uncertainties while noting that AI development and computing costs could pressure margins. Adobe also faces EU AI Act obligations being implemented through 2030, potentially increasing compliance and development costs.
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Global regulatory exposure
Approximately 52% of employees are located outside the United States, increasing exposure to international labor, tax, privacy, geopolitical and regulatory changes. The filing also highlights evolving cross-border data-transfer requirements that could raise compliance costs or limit service delivery.
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Intensifying AI competition
Adobe states that competition is intensifying from large technology companies, new entrants and AI-native providers, which could pressure pricing, gross margins, renewals and upsell rates. The filing specifically notes that competitors may develop competing AI solutions more rapidly or successfully.
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Large ongoing capital return program
Adobe repurchased 9.5 million shares during the quarter at an average price of $233.93, while $24.549 billion remained available under repurchase plans at August 28, 2026. Continued buybacks could reduce financial flexibility if operating conditions weaken.
Management's outlook
The provided 10-Q text does not include quantitative guidance. Prior outlook was disclosed in the September 10, 2026 earnings release rather than this filing.
Earlier filings 4
10-Q · March 25, 2026
Adobe reported strong Q1 fiscal 2026 operating results with revenue of $6,398 million (up $684 million, +12.0% YoY and +$208 million, +3.4% sequentially). Gross margin remained very high at 89.6% and operating margin…
10-Q · September 24, 2025
Adobe reported solid Q3 results with revenue of $5,988 million (up from $5,408 million a year ago) and diluted EPS of $4.18 (versus $3.76 in Q3 2024). Operating income rose to $2,173 million and gross margins remained…
10-K · January 13, 2025
Adobe positions itself around two strategic growth areas — Digital Media (Creative Cloud and Document Cloud) and Digital Experience (Experience Cloud) — and is aggressively embedding generative AI across products…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.