Adobe Pulls In Record Revenue Again But Isn’t Tying Any of It to AI Yet

Adobe increases its Creative Cloud prices, posts record revenue. Adobe HQ in California.

After breaking $5 billion in revenue in a single quarter for the first time last year, Adobe has followed up with two straight quarters of record revenue and achieved most recently $5.31 billion in Q2.

In the past three quarters — just nine months — Adobe has raked in a total of $15.54 billion in revenue led most recently by Q2 results that were 10% greater versus the same period last year. Adobe bought back about 4.6 million shares during last quarter, too. It’s stock is up about 14% to around $523 per share at the time of publication. That is in addition to the 17% jump the shares experienced yesterday right after Adobe announced the results. Adobe’s CEO Shantanu Narayan might not be on the same wavelength as the company’s users, but he absolutely understands shareholder value.

Adobe reports that the Digital Media segment alone pulled in $3.91 billion in revenue, which represents 11% year-over-year growth. Creative revenue grew to $3.13 billion, which is 10% year-over-year growth.

“We’re driving strong usage, value, and demand for our AI solutions across all customer segments and seeing early success monetizing new AI technologies across our Digital Media and Digital Experience businesses,” Nayrayan said in prepared remarks during a conference call discussing the Q2 results.

Barrons reports that while Adobe executives were happy to discuss the financial reports broadly, they declined to provide any concrete measure of the contribution of AI efforts to on its financial results. Adobe CFO Dan Durn says that it will do so “at some point” but stipulates that since it is still early in its “journey” on that end, it wants to be “pretty thoughtful” regarding it.

Realistically, it might be more that Adobe can’t tie revenue to AI very well yet. At present, only Adobe Express has limits on how many times an AI feature can be used, which is tracked using what Adobe calls Generative Credits. For a majority of Adobe’s customers, AI limitations are not being enforced even though they have been set and are being tracked. Adobe has not said when it plans to start enforcing its limits — which vary depending on what level subscription a user pays for — but that its choice not to enforce them is only going to last for a “limited time.”

Still, Durn said that nine billion images have been made with Adobe Firefly to date and more images were created in May 2024 than any previous month.

Image credits: Photographs by PHOTOGRAPHERNAMEHERE