Transcripts
Adobe Inc.'s management answers for the business every quarter. These are the exchanges that explain it best — verbatim, from the call transcripts preserved in Sources. Each link opens the full transcript at that page in a new tab.
Q2 FY2026 Earnings Call — June 11, 2026
The strategic reset: management chooses to route surging AI traffic into a free Firefly/Express funnel — knowingly cutting second-half ARR — while a CFO exit and a CEO succession are underway, and fields the sharpest 'why now, and what's the payback' pushback. · Open the full transcript →
The pivot thesis: AI is changing buyer behavior so fast that the near-term prize is free user acquisition, not immediate paid conversion.
Shantanu Narayen, Chair & CEO: As we reflect on the market context and our first half performance, it is clear that relative even to the beginning of fiscal 26, AI is accelerating customer behavior at an unprecedented speed and we need to evolve our strategy and execution to address these changing expectations. […] Big picture, the immediate opportunity for Adobe is to accelerate new user acquisition and lifetime value through a freemium offering.
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The one number that anchors the bull case: AI-first ARR tripled year-over-year to over $500 million.
Shantanu Narayen, Chair & CEO: Adobe's AI innovation has driven an impressive 3x year-over-year increase in AI-first ARR to greater than $500 million. We believe now is the time to aggressively acquire the next generation of Adobe loyalists.
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The candid cost and the leadership overhang: the freemium shift lowers 2H ARR, the CFO is departing, and a CEO search is live.
Shantanu Narayen, Chair & CEO: The strategic shift to acquire more freemium customers through Adobe and Firefly lowers our second half ARR growth expectations from individual subscribers. […] As we announced, Daniel Durn has decided to pursue a new opportunity outside the software industry. I would like to thank Daniel for his contributions to Adobe and wish him well. […] Given my decision to transition to Board Chair, I wanted to provide an update on the CEO search, which is progressing well.
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How the funnel actually works: rank for an intent search ('summarize this PDF'), do the task free, build a habit, then paywall.
David Wadhwani, President of Creativity & Productivity: We see a shift to LLM usage driving intent-based search. Someone might type into a search engine, 'summarize this PDF.' We use SEO and SEM capabilities to rank high for that query. When the user clicks our link, we take them directly into Acrobat web with a single call to action: upload your PDF, and we summarize it for them. When we summarize it, we introduce them to the AI Assistant so they can ask questions. We use this process to let them build a habit before we start applying a paywall.
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Q4 & FY2025 Earnings Call — December 10, 2025
The full-year proof-point call: FY25 revenue of $23.77B with AI-influenced ARR now over a third of the book, a record FY26 net-new-ARR guide, and the clearest walk-throughs of how Firefly Foundry and generative credits actually monetize. · Open the full transcript →
The FY25 scoreboard, framed around AI: record $23.77B revenue and $20.94 non-GAAP EPS, with AI-first ARR accelerating through the year.
Shantanu Narayen, CEO: In fiscal 2025, Adobe delivered significant AI-influenced and AI-first ending ARR, which accelerated through the year. We achieved record revenue of $23.77 billion and non-GAAP EPS of $20.94, which represents outstanding financial performance.
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Firefly Foundry economics: a media customer spending ~$10M on core creative added ~$7M for custom-model services after a six-month sale.
David Wadhwani, President of Digital Media: let's say that that organization was spending $10 million with us ARR on our core creative products that we've been selling with them. We ran a sales process with them and gave engagement with them for about six months. We were able to sell them Firefly services Firefly Foundry for about $7 million, so pretty significant step up in terms of, you know, the engagement that we have with the customer.
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The recurring bear case: when does all this AI usage finally show up as stable or accelerating ARR? Narayen argues Q4 is that inflection.
Keith Weiss (Morgan Stanley); Shantanu Narayen, CEO: When can we potentially see this sort of grow the totality or stabilize or accelerate the totality of growth? At Adobe. Meaning, another when we see a year where ARR growth is stable, right, on a year-on year basis or actually improving, because I think that's what investors really wanna see to get more confident in the stock and start revisiting the stock and coming back to the shares? […] Q4 was a really strong quarter. And frankly, starting to be this inflection in terms of as we see the leading indicators. What is happening across the leading indicators. You know, which gives us a lot of confidence.
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How generative AI monetizes: base credits per plan, then upgrades or add-on packs; a multiplier of apps, media, use cases and models.
David Wadhwani, President of Digital Media: we introduced, generative credits a few years ago when we introduced, generative AI into our products. And customers get credits in a couple of different ways. First, you know, all of our plans now come with some base level of credit, access. And, of course, higher-end plans include more credits. The second thing is that when customers deplete their credits, they can get more credits in one of two ways. They can upgrade to a higher-end plan, and or they can purchase generative credit add-on pack. And as we think about the growth algorithm associated with this, it's really a multiplier across four different things. First of all, the number of apps that have these generative capabilities, times the number of media types that we support, times the number of use cases and workflows that we've integrated these into, times the number of models that we have that people are able to use.
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Q4 & FY2024 Earnings Call — December 11, 2024
A record year that the market hated: after $2B in net-new Digital Media ARR, the FY25 guide implied deceleration and the stock sank. Home to the bluntest 'is there a leak in the bucket?' challenge and Adobe's clearest growth-algorithm answer. · Open the full transcript →
The paradox in one line: a record FY24 — $21.5B revenue and the first-ever $2B of net-new Digital Media ARR — set against a falling stock.
Shantanu Narayen, CEO: 2024 was a year of records for Adobe. We achieved record revenue of $21.51 billion, representing 11% year-over-year growth. […] We had several new milestones with our AI innovations enabling us to add more than $2 billion in digital media net new ARR and surpass $1 billion in the ending book of business for Adobe Experience Platform and native apps.
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The Digital Media growth algorithm, 'p times q plus v' — new users, price/value, enterprise value — and why FY25 tilts to new users.
David Wadhwani, President of Digital Media: We've talked about this in the context of p times q plus v in the past. You know, where p is new users bringing in more people into the franchise. […] the composition of growth is going to be a little different next year compared to FY2024. Again, the growth algorithm is new users, new products, and value and pricing. New users and new products will be a more significant part of the mix as we go into FY2025.
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Guidance philosophy on AI: 'consumption' feeds ARR mainly through pricing tiers, not a metered model customers have to watch.
Keith Bachman (BMO); Shantanu Narayen, CEO: is that gonna be a contributor towards ARR growth, or should investors really be thinking about trying to match my seats, if you will, and really shouldn't it be about consumption being additive growth in 2025. […] you're gonna see, quote-unquote, consumption, add to ARR, in two or maybe three ways more so in 2025 than in 2024. […] So the intention is that consumption is what's driving the increased ARR, but it may be as a result of tier in the pricing rather than a consumption model where people actually have to monitor it.
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Q1 FY2024 Earnings Call — March 14, 2024
The first call after the Figma deal collapsed — the $1B breakup fee lands this quarter — and the Q&A is dominated by the existential question of the era: does generative AI expand Adobe's market or hollow out its tools and seats? · Open the full transcript →
The bill for the failed $20B bet: a $1B Figma termination payment that cut GAAP EPS by $2.19 and a matching hit to operating cash flow.
Dan Durn, CFO: GAAP EPS came in lower due to the $1 billion payment resulting from the termination of the Figma transaction. Absent the termination payment, our cash flows from operations would have been $1 billion more, and GAAP EPS would have been $2.19 higher.
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AI monetization, three ways: generative packs in Creative Cloud, a monthly Acrobat AI Assistant add-on, metered custom models in enterprise.
Shantanu Narayen, CEO: we have the generative packs, as you know, in Creative Cloud. I think you will see us more and more have that as part of the normal pricing and look at pricing because that's the way in which we want to continue to see people use it. I think in Acrobat, as you've seen, we are not actually using the generative packs. We're going to be using more of an AI Assistant model, which is a monthly model. As it relates to the Enterprise, we have both the ability to do custom models, which depends on how much content that they are creating, as well as an API and metering that we've rolled out and we've started to sell that as part of our GenStudio solution.
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The core bull-vs-bear pivot: does AI raise or shrink Adobe's seat count? Narayen argues more models mean more interfaces, not fewer.
Keith Weiss (Morgan Stanley); Shantanu Narayen, CEO: The primary concern I hear from many is whether the emergence of AI and the growing number of models, whether for image or video, will lead to an increase or decrease in the number of seats for Adobe and beyond. I firmly believe that as we discuss these models and interfaces for creative content, the number of these interfaces will definitely rise. Therefore, Adobe must seize this significant opportunity. Overall, larger models will create even more opportunities for interfaces, and I think we are particularly well-suited to capitalize on that.
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Q3 FY2022 Earnings Call — September 15, 2022
The landmark that set the terms of debate for years: the day Adobe announced its ~$20B bid for Figma. Management lays out the 'creativity on the web' rationale while analysts hammer the price, the dilution, and whether the organic engine still works. · Open the full transcript →
The announcement and the asset: a ~$400M-ARR, >150%-net-retention web design platform, bought to accelerate creativity on the web.
Shantanu Narayen, Chairman & CEO; David Wadhwani, President of Digital Media: I'm thrilled to share that today we announced our intention to acquire Figma, a leading web-first design platform that will help us accelerate this vision. […] Figma is expected to add approximately $200 million in net new ARR this year, surpassing $400 million in total ARR exiting 2022 with greater than 150% net-dollar retention rate. With the total addressable market of $16.5 billion by 2025, Figma is just getting started.
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The terms that spooked the market: ~$20B, half cash/half stock, dilutive to non-GAAP EPS for two years, accretive only exiting year three.
Dan Durn, CFO: we've agreed to acquire Figma for approximately $20 billion comprised of approximately half cash and half stock, subject to customary adjustments. […] In year 1 and 2 after closing the transaction will be dilutive to Adobe's non-GAAP EPS, and we expect it to be breakeven in year 3 and accretive at the end of year 3.
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The hardest question: is a $20B deal reactive, and is Adobe's organic engine still alive? Narayen: seize the decade-defining bet.
Brad Zelnick (Deutsche Bank); Shantanu Narayen, Chairman & CEO: what do you say to the perspective that this $20 billion acquisition seems more reactive versus proactive? And perhaps more importantly, how do we get comfortable that Adobe's organic-innovation engine is alive and well for capturing the trends and opportunities that lie ahead in Creative? […] I understand that in these markets, in particular, acquisitions and maybe large ones are viewed with some skepticism We certainly believe, and I'll talk about it, that Figma will be a transformative deal for the customers and industries. And it dramatically increases our TAM. We can deliver great value to an increasing set of customers. But I also want to reassure all of you, and if you look at our results, this in no way changes our focus or our excitement on our current portfolio.
We're growing well, and we're demonstrating strength across all of our 3 cloud offerings, and we continue to execute against our current initiatives And so if you look at the multiple internal businesses that are achieving velocity, whether it's Adobe Experience Platform and the apps that are built natively on top of it, what's happening with 3D and Immersive, what's happening with Acrobat Forms, what's happening with Frame.io. This is additive.
And when opportunities like this present themselves, Brad, I think it's the great companies that look at it and say, are you going to focus on the here and now only? Or are you going to seize on the opportunity that really positions Adobe for the next few decades?
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More calls
Q1 FY2026 Earnings Call — March 12, 2026 · 13 pages · The last call before the freemium reset: the FY26 opening quarter under the new customer-group reporting, CC Pro migration and agentic-interface framing — a baseline for what changed one quarter later. · Open →
Q3 FY2025 Earnings Call — September 11, 2025 · 13 pages · Mid-year evidence that the AI story was ramping: accelerating AI-influenced/AI-first ARR and enterprise GenStudio/AEP momentum heading into the Firefly and Foundry launches at MAX. · Open →
Q2 FY2025 Earnings Call — June 12, 2025 · 14 pages · The quarter Adobe began breaking out an AI-first 'book of business' target and defended the pace of AI monetization against a de-rated stock. · Open →
Q1 FY2025 Earnings Call — March 12, 2025 · 14 pages · The first quarter reported under the new 'ending ARR book of business' methodology, with the standalone Firefly app and video generation moving from beta to market. · Open →
Q3 FY2024 Earnings Call — September 12, 2024 · 13 pages · A tight, two-analyst Q&A centered on AI Assistant adoption and Firefly Services — and the CEO's recurring 'AI expands our TAM' argument as the stock stayed under pressure. · Open →
Q2 FY2024 Earnings Call — June 13, 2024 · 14 pages · A beat that briefly rallied the stock: net-new Digital Media ARR reaccelerated and management pushed back on the AI-disruption narrative amid the Firefly terms-of-use controversy. · Open →
Q1 FY2023 Earnings Call — March 15, 2023 · 17 pages · The pre-Firefly baseline: strong Creative and Document Cloud results with the Figma deal still pending regulatory review, just before Adobe unveiled its generative-AI models. · Open →
Q2 FY2022 Earnings Call — June 16, 2022 · 18 pages · The quarter before the Figma bombshell — a clean read on Adobe's pre-acquisition, pre-GenAI growth model and how it framed macro and pricing at the time. · Open →