Adobe Inc.
Application SoftwareFounded 1982- Updated June 2026
Reviewed by Swet Parvadiya
Last reviewed: June 2026
CorpDigest
Adobe Inc.
Financial Performance
Last reviewed: June 2026 · By Swet Parvadiya
Revenue
$23.8B
Market Cap
$165.0B
Net Income
$5.7B
Employees
31,360
Adobe repurchased approximately $8 billion of its own stock during fiscal 2025 — a capital return figure that represents roughly 34 percent of its $23.8 billion in annual revenue. That scale of buyback from a software company reflects both the extraordinary cash generation of the subscription model and management's conviction that the shares represent better value than most acquisition targets available at current prices. Net income of $5.7 billion on $23.8 billion in revenue represents a 24 percent net margin — exceptional for a company at this scale and reflective of the operational leverage embedded in subscription software. Once a customer is enrolled in Creative Cloud, the incremental cost of serving them is minimal; the software updates, cloud storage, and support services are effectively fixed costs spread across an enormous subscriber base. Revenue has grown from $17.6 billion in fiscal 2022 to $23.8 billion in fiscal 2025, a 35 percent increase over three years driven almost entirely by subscription expansion and pricing increases rather than customer count growth alone. The $165 billion market capitalization at roughly seven times revenue prices Adobe as a premium software franchise — justified by the Remaining Performance Obligations figure of $22.52 billion that signals contracted future revenue regardless of new sales. The $1 billion Figma termination fee was a one-time charge that compressed fiscal 2024 earnings but didn't alter Adobe's underlying trajectory. Firefly's commercial availability since 2023 has added a generative AI revenue stream that's still small but growing. The critical question for Adobe's next five years is whether Firefly's licensed-content training advantage materializes into a durable market position or whether copyright law evolves in ways that level the playing field with AI competitors trained on unlicensed imagery.
Revenue Trend Analysis
YoY Change
+10.5%
4-Year CAGR
+10.8%
Peak Year
2025
Trend
Consistent Growth
Adobe Inc. has reported revenue across 5 fiscal years, compounding at +10.8% annually over 4 years. The most recent year saw a 10.5% increase versus the prior year. Revenue peaked in 2025 at $23.8B. Out of 4 reported periods, 4 showed growth and 0 showed a decline.
| Fiscal Year | Revenue | Net Income | YoY Change |
|---|---|---|---|
| FY2025 | $23.8B | $5.7B | +10.5% |
| FY2024 | $21.5B | — | +10.8% |
| FY2023 | $19.4B | — | +10.2% |
| FY2022 | $17.6B | — | +11.5% |
| FY2021 | $15.8B | — | — |
Source: SEC EDGAR filings, annual earnings releases, and verified financial disclosures.
Click any row to see year details.
Adobe's approximately 24% net margin on $23.8 billion revenue reflects the high-margin nature of software subscriptions: once development costs are incurred, incremental revenue from additional subscribers has near-zero marginal cost. Adobe's gross margin exceeds 87%. Operating expenses — R&D (~18% of revenue), sales and marketing (~22%), and G&A (~6%) — account for the gap between gross and net margins. Adobe's GAAP net income understates cash generation due to stock-based compensation (~$1.8 billion annually) reducing reported earnings.
Adobe paid Figma a $1 billion breakup fee when it terminated the proposed $20 billion acquisition in December 2023 after the EU's Competition Commission signaled it would block the deal on grounds that it would eliminate a major competitive threat in interactive product design. The $1 billion fee was a direct cash charge to earnings. Despite this setback, Adobe's stock ultimately recovered as investors appreciated the company retaining $20 billion in capital rather than completing an acquisition the market had viewed skeptically.
Adobe accelerated share repurchases after the Figma termination, returning capital to shareholders that would have been used in the acquisition. The company has historically bought back $3-5 billion in stock annually, reducing share count and supporting earnings per share growth. By preserving the $20 billion that would have been spent on Figma, Adobe signaled financial discipline — buying back shares at what management considered undervalued prices contributed to stock price recovery through 2024.
Adobe's free cash flow typically exceeds reported GAAP net income due to the non-cash nature of stock-based compensation and amortization of acquired intangibles. In fiscal 2025, operating cash flow was approximately $7.5 billion versus $5.7 billion net income — a meaningful premium. This strong cash generation funds stock buybacks, acquisitions, and R&D investment without requiring debt. Adobe's cash conversion efficiency makes it one of the most financially productive large-cap software companies.