Adobe Inc. (ADBE) is entering a competitive landscape as it expands its AI-related initiatives amid challenges faced by traditional SaaS software stocks. Year-to-date, Adobe shares have declined by 27.1% as it seeks to improve its market position in the face of competitors like Microsoft (MSFT) and Alphabet (GOOGL). The Zacks Consensus Estimate projects Adobe’s revenues to reach $26.04 billion for fiscal 2026, reflecting a 9.5% increase from the previous fiscal year.
Adobe is enhancing its offerings through partnerships with companies such as Amazon Web Services and OpenAI, and integrating AI capabilities into its Adobe Firefly, Express, and Creative Cloud applications. Its new features in Acrobat include AI chat experiences and tools aimed at improving productivity, which have led to rising demand from individuals and businesses alike.
In contrast, Adobe’s AI business remains significantly smaller than that of Microsoft and Alphabet. While Adobe’s share price has decreased by 42.5% over the past year, the broader Zacks Computer and Technology sector has seen a return of 25.2% during the same period. Adobe currently holds a Zacks Rank of #3 (Hold), with a price/sales ratio of 3.94 compared to the sector’s 6.38.
