Adobe reports record Q3 FY2025 revenue of $6.0bn, raises full-year revenue and EPS targets on AI momentum

Overview

Adobe delivered strong third quarter fiscal 2025 results, with record revenue and robust growth across Digital Media and Digital Experience segments. AI-driven adoption continued to accelerate, with AI-influenced ARR surpassing $5bn and AI-first ARR exceeding its $250m year-end goal ahead of schedule. Management raised its full-year FY2025 revenue and EPS targets, citing strong customer demand, innovation, and consistent execution.

Q3 FY2025 vs. Q3 FY2024:

• Total revenue was $5.99bn (+11% YoY and +10% in constant currency), driven by subscription strength across both business segments.
  • Digital Media revenue was $4.46bn (+12% YoY and +11% CC), with ARR reaching $18.59bn (+11.7% YoY).
  • Digital Experience revenue grew to $1.48bn (+9% YoY), led by subscription revenue of $1.37bn (+11% YoY).
  • Business Professionals & Consumers subscription revenue was $1.65bn (+15% YoY), while Creative & Marketing Professionals subscription revenue totaled $4.12bn (+11% YoY).
• GAAP operating income rose to $2.17bn (+9% YoY), while non-GAAP operating income increased to $2.77bn (+10% YoY), reflecting operating leverage.
• Operating expenses increased to $3.17bn (+11% YoY), mainly reflecting higher R&D and sales and marketing investments.
• GAAP net income grew to $1.77bn (+5% YoY), while non-GAAP net income rose to $2.25bn (+8% YoY).
• GAAP diluted EPS increased to $4.18 (from $3.76), and non-GAAP diluted EPS reached $5.31 (from $4.65).
• Operating cash flow was $2.20bn, up from $2.02 billion last year, demonstrating strong cash generation.
• Remaining performance obligations (RPO) climbed to $20.44bn (+13% YoY), with cRPO at 67%.
• Adobe repurchased 8.0m shares during the quarter, continuing its capital return program.

For Q4 FY2025, Adobe guided revenue of $6.075bn-$6.125bn, Digital Media revenue of $4.53bn-$4.56bn, and Digital Experience revenue of $1.495bn-$1.515bn. GAAP EPS is expected at $4.27-$4.32 and non-GAAP EPS at $5.35-$5.40. For FY2025, Adobe raised its total revenue target to $23.65bn-$23.70bn, Digital Media revenue to $17.56bn-$17.59bn, and EPS to GAAP $16.53-$16.58 / non-GAAP $20.80-$20.85. Management reiterated its confidence in AI-powered innovation as the primary driver of growth across creative and digital experience markets.

Adobe’s stock showed a fairly neutral reaction immediately after its earnings release, with the price staying below the 50-day SMA ($356.01) in the days that followed. Only in the most recent trading week did the stock manage to break above this level, advancing around +4.4% over the last five sessions. Even so, the RSI sits at 58.72, a neutral reading that does not yet confirm a clear trend reversal. From a broader perspective, Adobe continues to trade within a downward channel, with year-to-date performance showing a decline of roughly -17% over the first nine months of 2025, underscoring the prevailing bearish bias despite short-term rebounds.

Author: Ionuț-Adrian Lazar