Adobe has announced an upward revision of its fiscal year (FY) 2025 forecasts after achieving record revenue in the second quarter. The company now projects annual revenue to be between $23.5bn and $23.6bn, up from its prior forecast of $23.3bn to $23.55bn. Additionally, the Photoshop maker increased its Non-GAAP earnings per share projection to between $20.50 and $20.70, up from the earlier forecast of $20.20 to $20.50.
“As a result of us driving strong performance in the first half of the year, we are pleased to raise Adobe’s FY25 total revenue and EPS targets,” said Adobe executive vice president and CFO Dan Durn. “We continue to invest in AI innovation across our customer groups to enhance value realisation and expand the universe of customers we serve.”
Adobe’s Q2 success anchored by strong segment growth
In the second quarter of FY2025 that ended on 30 May, Adobe reported a record revenue of $5.87bn. This figure surpasses the company’s own estimates, following a weaker first quarter, and represents an 11% increase compared to the same period last year. The company posted a GAAP diluted earnings per share of $3.94 and a non-GAAP figure of $5.06 in the quarter.
Adobe’s GAAP operating income rose to $2.11bn, up from $1.89bn reported in Q2 FY24. Net income on a GAAP basis also increased, reaching $1.69bn from $1.57bn in the same period previous fiscal.
The Digital Media segment, a significant contributor to Adobe’s revenue, generated $4.35bn, reflecting an 11% year-over-year (Y-o-Y) growth. The Digital Media Annualized Recurring Revenue (ARR) at the end of the quarter stood at $18.09bn, representing a 12.1% Y-o-Y increase. Digital Experience segment also showed strong performance, with revenue reaching $1.46bn, a 10% rise Y-o-Y. Subscription revenue for this segment jumped 11% from prior year quarter to $1.33bn.
Adobe’s Business Professionals and Consumers Group subscription revenue grew 15% Y-o-Y to $1.60bn. The Creative and Marketing Professionals Group generated $4.02bn in subscription revenue in Q2 FY25.
“Our strategy to deliver ground-breaking innovation for Business Professionals and Consumers, and Creative and Marketing Professionals is delighting customers, and we are pleased to raise Adobe’s FY25 revenue target,” said Adobe chair and CEO Shantanu Narayen. “Adobe’s AI innovation is transforming industries, enabling individuals and enterprises to achieve unprecedented levels of creativity.”
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