Adobe Posts 10% Q4 Revenue Rise, 89.5% Margins and $12B Buybacks
Adobe delivered 10% year-over-year Q4 fiscal-2025 revenue of $6.19 billion and 89.5% gross margins, driving operating income up 11% to nearly $11 billion while repurchasing $12 billion of shares. Management guides fiscal-2026 revenue of about $26 billion, implying roughly 10% growth and 12% EPS expansion.
1. Q4 Fiscal 2025 Performance
Adobe reported Q4 revenue of $6.19 billion, up 10% year-over-year (11% on a constant-currency basis), with gross margins of 89.5% and operating income rising 11% to nearly $11 billion.
2. Annual Results and Cash Flow
For fiscal 2025, Adobe generated record revenue of $23.77 billion, an 11% increase, and produced over $10 billion in operating cash flow, underscoring its strong subscription-based model and profitability.
3. Share Repurchase Program
The company repurchased $12 billion of its own stock in fiscal 2025, retiring 30.8 million shares (over 6% of the float) and leaving approximately $6 billion of authorization remaining, signaling management’s confidence in valuation.
4. FY2026 Guidance and AI Debate
Management guides fiscal 2026 revenue between $25.9 billion and $26.1 billion (9.4%–10.2% growth) with EPS up about 12%, while market fears of AI-driven subscription declines contrast with Adobe’s strategy to integrate AI and sustain its growth trajectory.