Adobe’s annual recurring revenue from AI tripled to $500M, yet its stock trades at a discount to peers like Salesforce and Autodesk.
Adobe (ADBE) shares trade at 10x forward earnings, a multiple typically seen in mature hardware firms, despite $27.10 billion in annual recurring revenue (ARR). The company’s AI-driven ARR surged to $500M year-over-year, yet its valuation lags peers like Salesforce (CRM) at 23x trailing P/E and Autodesk (ADSK), which earns half Adobe’s EPS.
The stock has fallen 22.22% year-to-date and 22.98% over the past year, despite a 19.84% rally in the last month. Adobe’s Q2 FY26 revenue hit a record $6.62 billion, up 13% YoY, with non-GAAP EPS of $5.96, but shares dropped 6.76% post-earnings. The stock remains below its 52-week high of $370.86 but above the $190.12 low.
Analysts set a $307.15 price target, implying 12% upside from the current $276.63. The departure of CFO Dan Durn on June 15, 2026, adds to recent volatility, though the company’s AI growth narrative persists.