TLDR
- Adobe stock hit a 52-week low of $224.07 on Thursday, down 36% year-to-date
- Q2 earnings are due after the close Thursday, with analysts expecting $5.82 EPS on $6.45 billion revenue
- The stock has fallen after 8 of its last 10 earnings reports
- AI concerns continue to weigh on investor sentiment despite Adobe’s own AI product launches
- Options data implies a potential 8.7% move following the earnings release
Adobe (ADBE) stock touched a 52-week low of $224.07 on Thursday morning, dropping roughly 4.8% to $222.23 ahead of its fiscal second-quarter earnings report due after the close.
The stock is down 36% in 2026 and nearly 43% over the past 12 months, making it one of the worst performers in the enterprise software space this year.
Analysts surveyed by FactSet are expecting adjusted earnings of $5.82 per share on revenue of $6.45 billion. In the same quarter last year, Adobe posted $5.06 EPS on $5.87 billion in revenue.
That’s a solid year-over-year comparison on paper. The issue is that the market hasn’t been rewarding Adobe for beating numbers lately.
Adobe stock has fallen after eight of its last ten earnings reports, according to Dow Jones Market Data. Even when results have come in ahead of estimates, broader concerns have pulled the stock lower.
AI Remains the Overhang
The core worry hanging over Adobe is straightforward: can the company hold its ground as AI tools make creative work easier and cheaper for end users?
Adobe has been pushing back with its own AI rollout, including CX Enterprise, an AI agent platform targeting enterprise sales and customer experience workflows. But investor skepticism hasn’t shifted much.
“Longer term, the key question is whether Adobe can realistically position itself as the core orchestration layer for AI-driven enterprise creativity,” Third Bridge analyst Dylan Koehler wrote this week.
TD Cowen’s Derrick Wood lowered his price target to $285 from $310 on June 7, keeping a Hold rating. He said ADBE is positioned to benefit from generative AI, but it will take time to show up in the growth curve. Recent credit card data showed only 1.5% year-over-year growth, a soft data point heading into the print.
Stifel’s J. Parker Lane cut his target to $350 from $400 on the same date while keeping a Buy. He described the bar as “low” heading into the quarter, which is about as much optimism as Adobe is getting right now.
What Analysts Are Watching
Of 37 analysts covering the stock on FactSet, 17 rate it a Buy, 17 a Hold, and three a Sell. That’s a fairly split picture.
RBC Capital has an Outperform rating with a $350 target and expects Adobe’s total annual recurring revenue to come in above the $26.6 billion consensus. Mizuho holds a Neutral at $270, flagging negative sentiment but expecting solid organic revenue growth.
Piper Sandler is also at Neutral with a $280 target, pointing to Adobe’s own guidance of 9.9% year-over-year revenue growth, partly boosted by the Semrush acquisition.
Management is expected to reiterate its fiscal 2026 guidance, including a 10.2% growth target for Total Annual Recurring Revenue.
Despite the selloff, InvestingPro data shows Adobe carrying an 89% gross profit margin and a P/E ratio of 13.6. The platform has flagged the stock as potentially undervalued at current levels.
Options pricing implies an 8.7% move in either direction following Thursday’s report.
🚨 Our MAY Stock Picks Are Live!
A new month means new opportunities. Our analysts have just released their top stock picks for May, highlighting companies with strong momentum that rank highly on our KO Score algorithm. We’re also now sharing trade ideas for both long-term and short-term investors, giving you more ways to spot potential opportunities in the market.
Sign up to Knockout Stocks today and get 50% off to unlock the full list and see which stocks made the cut.
Use coupon code Special50 for your exclusive discount!
Be the first to comment