Adobe(US:ADBE)2025-12-10 21:05Financial Performance - Adobe achieved record revenue of $6.19 billion in Q4 FY2025, representing a 10% year-over-year growth[6] - Total Adobe Annualized Recurring Revenue (ARR) exiting FY2025 was $25.20 billion, reflecting an 11.5% year-over-year growth[11] - Digital Media segment revenue reached $4.62 billion in Q4 FY2025, marking an 11% year-over-year growth[6] - Digital Experience segment revenue was $1.52 billion in Q4 FY2025, representing a 9% year-over-year growth[6] - Business Professionals & Consumers subscription revenue was $1.72 billion in Q4 FY2025, reflecting a 15% year-over-year growth[6] - Adobe's GAAP net income for FY2025 was $7.13 billion, with diluted EPS of $16.70[11] - Net income for the three months ended November 28, 2025, was $1,856 million, an increase of 10.3% compared to $1,683 million for the same period in 2024[23] - Non-GAAP operating income for the three months ended November 28, 2025, was $2,824 million, up 8.8% from $2,596 million in the prior year[25] - GAAP diluted net income per share for the three months ended November 28, 2025, was $4.45, up from $3.79 in the same period last year, reflecting a growth of 17.4%[25] Cash Flow and Assets - Operating cash flows for FY2025 were over $10 billion, with record cash flows from operations of $3.16 billion in Q4[5][6] - Cash and cash equivalents at the end of the period were $5,431 million, a decrease of 28.6% from $7,613 million at the end of the same period last year[23] - Total assets decreased to $29,496 million as of November 28, 2025, down from $30,230 million a year earlier, representing a decline of approximately 2.4%[22] - The company reported a net cash provided by operating activities of $3,160 million for the three months ended November 28, 2025, an increase of 8.2% from $2,921 million in the same period last year[23] Liabilities and Share Repurchase - Total liabilities increased to $17,873 million as of November 28, 2025, compared to $16,125 million a year earlier, marking an increase of approximately 10.8%[22] - The company repurchased approximately 7.2 million shares during Q4 FY2025 and 30.8 million shares throughout FY2025[6][11] - The company repurchased $2,474 million of common stock during the three months ended November 28, 2025, compared to $2,500 million in the same period last year[23] Future Projections - Adobe plans to target over 10% growth in Total Adobe ending ARR for FY2026[5] - For FY2026, Adobe projects total revenue between $25.90 billion and $26.10 billion, with earnings per share (EPS) guidance of $17.90 to $18.10 on a GAAP basis[10] - For fiscal year 2026, the company projects GAAP diluted net income per share to be between $17.90 and $18.10, with non-GAAP diluted net income per share expected to be between $23.30 and $23.50[28] Tax and Non-GAAP Measures - The effective income tax rate for GAAP was reported at 18.0% for the fourth quarter of fiscal 2025, with a non-GAAP effective income tax rate of 18.5%[27] - Adobe utilizes non-GAAP financial information to evaluate ongoing operations and for internal planning and forecasting purposes[31] - Non-GAAP measures may exclude items such as stock-based compensation, amortization of intangibles, and other non-operational items[32] - Adobe provides reconciliations of non-GAAP financial measures to the most closely applicable GAAP financial measures[32] - The management believes that non-GAAP measures offer greater transparency regarding key metrics used in financial and operational decision-making[31] - Investors are encouraged to review both GAAP and non-GAAP financial measures for a comprehensive understanding of Adobe's performance[32] - Non-GAAP measures are considered useful for assessing the performance of Adobe's business and for future planning[32] - The company emphasizes that non-GAAP measures should not be viewed in isolation from GAAP financial information[31] - Adobe's management does not suggest that investors consider non-GAAP measures as substitutes for GAAP measures[31] - The use of non-GAAP measures allows institutional investors and analysts to better evaluate Adobe's operating results and future prospects[31] - Adobe continues to comply with all GAAP requirements while providing additional non-GAAP insights[31]