Adobe beats estimates and holds its 10.2% ARR target
Adobe on September 10, 2026 reported fiscal third-quarter revenue of $6.76 billion and left its full-year ARR growth target at 10.2%.
Adobe, whose subscription software is used to design, edit documents and run digital marketing, posted a fifth straight non-GAAP earnings beat after the close on Thursday, raised its 2026 revenue and earnings targets, and said it had crossed 1 billion monthly active users. The one figure that did not move was the full-year target for annual recurring revenue growth, left at 10.2%. Shares had already finished the regular session at $248.83.
Adobe is down 28.9% this year; the Nasdaq-100 is up 15.3%
- Adobe
- Nasdaq-100
- 1-day
- Adobe −2.4%
- Nasdaq-100 −1.1%
- 5-day
- Adobe −11%
- Nasdaq-100 −0.1%
- YTD
- Adobe −29%
- Nasdaq-100 +15%
As of 4:58 p.m. Eastern, before the 5 p.m. conference call, extended-hours quotes were at $243.62, another 2.1% below that close.
The user count is the reach argument. The unchanged 10.2% ARR target is the monetization argument. They can both be true at once.
The quarter versus June’s bar
For the quarter ended August 28, Adobe reported revenue of $6.76 billion, up 13% from a year earlier, or 12% in constant currency. Non-GAAP diluted earnings were $6.13 a share against a $6.08 consensus; GAAP diluted earnings were $4.62. It was the tightest of Adobe’s last five non-GAAP beats. Subscription revenue across customer groups was $6.56 billion, up 14%; both the Acrobat and Express cohort and the Creative Cloud and marketing-software book cleared their June ranges.
Results cleared the top of the revenue, GAAP earnings, and non-GAAP earnings ranges Adobe set in June. Adobe beat the top of its June quarterly revenue range by $40 million and lifted the top of the full-year range by $26 million. The raise is real and small: full-year revenue is now $26.576 billion to $26.626 billion, up from $26.50 billion to $26.60 billion. Non-GAAP earnings are $24.45 to $24.50, up from $24.35 to $24.45.
Fourth-quarter revenue is guided to $6.80 billion to $6.85 billion, a $40 million to $90 million step-up from the quarter just printed. Non-GAAP earnings are $6.30 to $6.35, on a 44% non-GAAP operating margin and about 389 million diluted shares.
Chair and chief executive Shantanu Narayen called it a record third quarter and tied it to AI products and a wider customer reach. Interim chief financial officer Steve Day said Adobe delivered double-digit revenue and earnings growth “and we’re raising full year revenue and EPS targets.”
ARR left at 10.2%
Annual recurring revenue, the yearly value of subscription contracts, exited the quarter at $27.50 billion, up from $27.10 billion at the end of May, including Semrush. The full-year target for ending ARR growth was left at 10.2%, the same rate Adobe has carried since it set 2026 targets last December and the same rate it reiterated in June.
Revenue and earnings moved up. The subscription book’s growth rate did not.
Adobe also kept buying its own shares: about 9.5 million in the quarter, a $2.23 billion cash outflow, after 8.5 million in the second quarter.
One billion users, and a conversion test
Adobe said it had crossed 1 billion monthly active users across its creativity and productivity products, a figure Narayen called a landmark. AI-first ARR, the slice of the book tied to products built around generative tools, “grew more than 150% year over year.” The company did not attach a dollar amount. In June it had put that book above $500 million and said Firefly ARR was approaching $300 million; neither Firefly nor GenStudio received a new figure in Thursday’s release.
Day pointed to a freemium push (free versions meant to convert later) and to “agentic experiences,” Adobe’s term for AI that can carry out tasks inside the apps. Those are the same levers the company has been using as cheaper generative-AI tools from Microsoft, Alphabet, Canva and others compete with Adobe for creative professionals.
Where Adobe sits in the funds that hold it
The shares are 33% below a 52-week high of $370.86, at a $98.9 billion market value.
Adobe fell 11% in five sessions into the print
- Adobe · 248.83
- Nasdaq-100 · 29,103.51
In a broad index the weight is small. In a software sleeve it is not. Adobe is a 3.5% line in the iShares Expanded Tech-Software Sector ETF IGV, a North American software fund etf.net grades B, and 3.6% of the VictoryShares Free Cash Flow ETF VFLO, which screens U.S. large-caps for free cash flow and is graded C. It is 0.46% of the Invesco QQQ Trust QQQ, a Nasdaq-100 tracker graded A. IGV fell 0.6% in the regular session and QQQ fell 1.1%, moves that predated the earnings release.
If you hold Adobe inside QQQ, Thursday’s print is a rounding error. Inside IGV or VFLO, it is a 3.5% to 3.6% position in a franchise that just restated 10.2% ARR growth and did not put a dollar figure on a 1 billion-user claim.
Frequently asked
Did Adobe beat expectations?
Yes: revenue and non-GAAP earnings both cleared consensus and the top of Adobe's own June ranges, though it was the tightest of its last five non-GAAP beats.
Why does the unchanged ARR target matter?
Annual recurring revenue is the yearly value of subscription contracts, so holding the growth target at 10.2% says the subscription book is not accelerating even as revenue and earnings rose.
What did Adobe say about its AI business?
AI-first ARR grew more than 150% year over year, but Adobe attached no dollar amount and gave no new figures for Firefly or GenStudio.
How much does this move an ETF investor?
Adobe is about 0.46% of the Invesco QQQ Trust but 3.5% of the iShares Expanded Tech-Software Sector ETF and 3.6% of the VictoryShares Free Cash Flow ETF.