Adobe’s AI Ambitions Face Investor Scrutiny

Adobe, long considered a pioneer in integrating artificial intelligence into creative software, now faces significant pressure as its AI strategy comes under the microscope. A recent downgrade by Morgan Stanley highlights growing concerns that the company’s massive investments in generative AI may not deliver the expected financial returns. The central challenge for the software giant is demonstrating that its technology can become a substantial revenue driver.

Despite the current skepticism, Adobe’s most recent financial performance was robust. In mid-September, the company reported record third-quarter results, with revenue reaching $5.99 billion. This figure represented a 10.7 percent increase compared to the same period last year. Furthermore, the adjusted earnings per share of $5.31 comfortably exceeded market expectations.

However, investor... Read more...