Adobe (ADBE, Financial) has issued a disappointing financial outlook for fiscal year 2025, raising concerns about potential disruption from AI-driven startups. The company forecasts revenue of approximately $23.4 billion, with adjusted earnings per share between $20.2 and $20.5. Analysts had expected revenue of $23.8 billion and earnings per share of $20.52.
Known for its creative software, Adobe is integrating generative AI features into its applications, including embedding its Firefly model in Photoshop. At its annual user conference, Adobe launched an AI tool for video creation, now incorporated into Premiere and gradually being released to the public.
Following the announcement, Adobe's stock fell about 8% in after-hours trading, closing at $549.93. The stock has declined 7.8% year-to-date, underperforming its peers and industry benchmarks, amid investor concerns about AI-driven competition from companies like OpenAI and Runway AI.
