Analyst cites decelerating revenue growth despite AI expansion and strong SaaS resilience for the downgrade.
Adobe’s stock rating was lowered to Neutral from Buy by Phillip Securities, which also slashed its price target to $203 from $385. The downgrade reflects concerns over slowing growth despite the company’s early AI investments and resilient SaaS performance.
The company reported a 13% year-over-year revenue increase to $6.62 billion in Q2 fiscal 2026, up from $5.87 billion. GAAP net income reached $1.71 billion, while non-GAAP net income totaled $2.40 billion. Adobe recently announced plans to acquire Topaz Labs to bolster its AI-driven video and image enhancement tools.
No immediate market reaction was disclosed in the report.