Summary
Adobe Inc. reported solid financial results for the quarter ending May 29, 2026. Total revenue increased by 13% year-over-year to $6.62 billion, driven by a robust 14% growth in subscription revenue, which now constitutes 97% of total revenue. This growth was primarily fueled by strong performance in both the Creative & Marketing Professionals segment and the Business Professionals & Consumers segment. The company also saw a significant increase in goodwill due to the acquisition of Semrush for $1.87 billion, which is expected to enhance its marketing and SEO capabilities. Despite an increase in operating expenses, particularly in sales and marketing, Adobe maintained its net income at $1.71 billion, relatively flat compared to the prior year. Cash flow from operations remained strong, increasing by 10% to $5.12 billion for the six-month period. The company continues to return capital to shareholders through its aggressive stock repurchase program, repurchasing $4.59 billion in the six-month period. Adobe's Annualized Recurring Revenue (ARR) also saw healthy growth, reaching $27.10 billion, up 12.5% year-over-year.
Key Highlights
- 1Total revenue grew 13% year-over-year to $6.62 billion.
- 2Subscription revenue, the primary revenue driver, increased 14% year-over-year to $6.42 billion.
- 3Acquired Semrush for $1.87 billion, adding to goodwill and enhancing marketing/SEO offerings.
- 4Net income remained stable at $1.71 billion.
- 5Operating expenses increased 17% year-over-year, primarily due to higher sales and marketing costs.
- 6Cash flow from operations increased 10% year-over-year to $5.12 billion for the six-month period.
- 7Stock repurchase program remains active with $4.59 billion in repurchases during the six-month period.