adobe CEO Shantanu Narayan will step down after a successor is appointed and mentioned he’ll stay chairman of the design software program firm. Shares fell 7% in prolonged buying and selling.
Mr. Narayan joined Adobe in 1988 as vp and common supervisor and have become CEO in 2007. Underneath Narayan, Adobe has moved from software program licensing to subscriptions for Inventive Cloud utility bundles and is presently increasing with generative synthetic intelligence. He tried to purchase a fast-growing design software program firm figmaHowever regulators pushed again, and the 2 corporations ended the deal, leading to Adobe paying Figma a $1 billion penalty.
“On behalf of the board, I wish to commend Mr. Shantanu for his contributions as CEO and architect of Adobe’s transformation over the previous 18 years, and in positioning Adobe for achievement in an AI-driven period,” Frank Calderoni, Adobe’s lead impartial director, mentioned in a press release. “As we take the following step in our succession plan, we’re targeted on deciding on the proper chief for the following thrilling chapter of the corporate’s development, and we admire Mr. Shantanu’s continued management as CEO to make sure a clean transition.”
Mr. Narayan, 62, is the corporate’s lead impartial director. pfizer Along with his duties at Adobe, he acquired complete compensation of $51 million in fiscal 12 months 2025, based on the submitting. He owns $118 million in Adobe inventory, based on FactSet.
In a memo to staff, Narayan wrote that he’ll stay on Adobe’s board to assist Adobe’s subsequent CEO, simply as he did when co-founders John Warnock and Charles “Chuck” Geschke turned CEOs.
“What drew me to Adobe 28 years in the past was its management in creating new market classes, world-class merchandise, its fixed need to innovate in all practical areas of the corporate, and the folks I met throughout the interview course of,” Narayan wrote. “We proceed to create new markets, ship world-class merchandise, drive innovation in all the pieces we do, and entice and retain one of the best and brightest staff.”
On Narayen’s watch, Adobe’s inventory worth has soared greater than sixfold, and the S&P 500 index has risen about 350% in that point.
“Shantanu is a pacesetter I do know properly and deeply respect,” Dylan Area, co-founder and CEO of Figma, wrote in an X submit. “He’s considerate, variety, and relentless in pursuing Adobe’s imaginative and prescient. I’m grateful for the time we spent collectively and want him one of the best within the years forward.”
Satya Nadella, Adobe Associate CEO microsoftblessed Narayan.
“You constructed one of the vital necessary software program corporations on this planet, increasing the chances for creators, entrepreneurs, and types world wide. What has all the time impressed me is the empathy you delivered to the artistic course of and the instance you set as a pacesetter,” Nadella wrote to X.
Along with management bulletins, Adobe reported sturdy outcomes and steerage.
This is how the corporate carried out in comparison with the LSEG consensus:
Earnings per share: $6.06 adjusted vs. $5.87 anticipated Income: $6.4 billion vs. $6.28 billion anticipated
Adobe’s income for the fiscal first quarter ended Feb. 27 was up about 12% from the identical interval final 12 months, based on a press release. Internet earnings was $1.89 billion, or $4.60 per share, up from $1.81 billion, or $4.14 per share, within the year-ago interval. Adjusted earnings exclude stock-based and deferred compensation expense.
The corporate says its annual income from AI-first merchandise has greater than tripled.
Relating to steerage, Adobe anticipated fiscal second quarter adjusted earnings per share of $5.80 to $5.85 on income of $6.43 billion to $6.48 billion. Analysts polled by LSEG had anticipated earnings of $5.68 per share and income of $6.42 billion.
Traders are taking a tricky stance on software program shares attributable to considerations about disruption from generative AI fashions. Adobe inventory had fallen almost 23% for the reason that begin of 2026 as of Thursday’s shut, in contrast with about 3% for the S&P 500 index over the identical interval. The inventory has fallen greater than 60% from its all-time excessive since 2021, after declining greater than 20% in every of the previous two years.
Subscription income for artistic and advertising professionals totaled $4.39 billion, a rise of 12% and above the $4.31 billion consensus of analysts surveyed by StreetAccount.
Through the quarter, Adobe introduced an expanded partnership with promoting firm WPP, in addition to the supply of Acrobat, Specific, and Photoshop apps for OpenAI’s ChatGPT assistant.
Throughout Adobe’s fiscal first quarter, mixed month-to-month customers of Acrobat, Inventive Cloud, Specific and Firefly rose 17% to 850 million, Narayan mentioned on a convention name with analysts. The rent “clearly demonstrates that now we have sturdy utilization and monetization fundamentals,” he mentioned.
Adobe Inventory companies, which give inventory images and different media, signify roughly $450 billion of enterprise and declined considerably greater than administration anticipated throughout the quarter.
“This transformation is going on sooner than we had deliberate, and we stay targeted on giving our clients significant selections between Inventory and generative AI as they construct their artistic and advertising workflows,” David Wadhwani, president of Adobe’s Creativity and Productiveness enterprise, mentioned on the convention name.
—CNBC’s Ari Levy contributed to this report.
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