Adobe (ADBE.O) raised its revenue forecast for fiscal 2024 on Thursday, citing increased adoption of its AI-driven editing tools by businesses and consumers amid signs of economic stabilization. Shares of the San Jose, California-based company surged over 16% in after-hours trading.
The updated outlook now anticipates revenue ranging from $21.40 billion to $21.50 billion, compared to the previous forecast of $21.30 billion to $21.50 billion. Analysts, on average, had expected $21.46 billion, according to LSEG data.
Adobe’s revised forecast underscores the success of its AI initiatives, with customers ramping up spending on software products like Premiere Pro, Animate, and After Effects, widely used by creative professionals across various industries.
In April, Adobe announced plans to integrate an AI tool for image generation into its popular Photoshop software, addressing competitive pressures from companies such as OpenAI, Stability AI, and Midjourney.
The company also increased its full-year adjusted earnings per share forecast to a range of $18 to $18.20, up from the previous range of $17.60 to $18 per share.
“Despite AI-driven competition impacting peers, Adobe’s robust performance indicates its strong market position among large-cap software firms,” noted Gil Luria, research analyst at D.A. Davidson.
For the second quarter, Adobe reported revenue of $5.31 billion, surpassing expectations of $5.29 billion. Digital media revenue totaled $3.91 billion, exceeding estimates of $3.89 billion.
Adobe has developed its own AI tool, Firefly, for image generation, leveraging proprietary data amid heightened concerns over data privacy and copyright issues associated with AI-generated content.
