ADBE 8-K — Smart Summary

Adobe reported record Q1 FY2026 results for the quarter ended February 27, 2026, with total revenue of $6.40 billion, up 12% YoY, and record Q1 operating cash flows of $2.96 billion. The filing also discloses that CEO Shantanu Narayen has notified Adobe of his decision to transition from the CEO role once a successor is appointed, while remaining as Chair of the Board.

• Total revenue: $6.40 billion (Q1 FY2026) vs. $5.71 billion (Q1 FY2025), +12% YoY; +11% in constant currency
• GAAP operating income: $2.42 billion vs. $2.16 billion, +11.8% YoY; non-GAAP operating income: $3.04 billion vs. $2.72 billion, +11.8% YoY
• GAAP net income: $1.89 billion vs. $1.81 billion, +4.3% YoY; non-GAAP net income: $2.49 billion vs. $2.22 billion, +11.9% YoY
• GAAP diluted EPS: $4.60 vs. $4.14, +11.1% YoY; non-GAAP diluted EPS: $6.06 vs. $5.08, +19.3% YoY
• GAAP gross profit: $5.73 billion vs. $5.09 billion; implied GAAP gross margin ~89.6% vs. ~89.1% YoY
• GAAP operating margin: ~37.8% (Q1 FY2026) vs. ~37.9% (Q1 FY2025); non-GAAP operating margin implied ~47.4% vs. ~47.5% YoY
• Record Q1 cash flows from operations: $2.96 billion vs. $2.48 billion, +19.2% YoY

• Total Customer Group subscription revenue: $6.17 billion, +13% YoY (+12% constant currency)
• Creative & Marketing Professionals subscription revenue: $4.39 billion, +12% YoY (+11% constant currency)
• Business Professionals & Consumers subscription revenue: $1.78 billion, +16% YoY (+15% constant currency)
• Total subscription revenue (GAAP): $6.20 billion vs. $5.48 billion, +13.0% YoY
• Product revenue: $90 million vs. $95 million, -5.3% YoY
• Services and other revenue: $110 million vs. $136 million, -19.1% YoY
• Total Adobe ARR exiting Q1 FY2026: $26.06 billion; AI-first ARR more than tripled YoY

• Adobe repurchased approximately 8.1 million shares during Q1 FY2026 at a cost of ~$2.48 billion
• Cash and cash equivalents at end of Q1 FY2026: $6.33 billion vs. $5.43 billion at end of Q4 FY2025
• Short-term investments: $558 million vs. $1.16 billion at end of Q4 FY2025
• Total debt (current + long-term): $6.23 billion vs. $6.21 billion at end of Q4 FY2025; current debt of $849 million
• RPO exiting Q1 FY2026: $22.22 billion; current RPO (cRPO): 67% of total RPO
• No dividends mentioned in the press release

• "Adobe delivered record Q1 results with AI-first ARR more than tripling year over year and subscription revenue growing 13 percent. Our mission to empower everyone to create represents an even larger opportunity as content powers all experiences in the AI era." — Shantanu Narayen, Chair and CEO
• "Adobe delivered 13 percent subscription revenue growth and record Q1 cash flow of $2.96 billion. As we accelerate AI-powered capabilities across creativity, productivity and customer experience orchestration, Adobe is well positioned for continued profitable growth." — Dan Durn, Executive Vice President and CFO

• Q2 FY2026 total revenue target: $6.43 billion to $6.48 billion
• Q2 FY2026 Business Professionals & Consumers subscription revenue: $1.80 billion to $1.82 billion
• Q2 FY2026 Creative & Marketing Professionals subscription revenue: $4.41 billion to $4.44 billion
• Q2 FY2026 GAAP diluted EPS: $4.35 to $4.40; non-GAAP diluted EPS: $5.80 to $5.85
• Q2 FY2026 assumptions: non-GAAP operating margin ~44.5%, GAAP tax rate ~22.5%, non-GAAP tax rate ~18.0%, diluted share count ~402 million
• FY2026 full-year targets reaffirmed (previously issued); targets exclude contributions from pending Semrush Holdings, Inc. acquisition

• Chief Executive Officer Shantanu Narayen — voluntarily transitioning from CEO role effective upon appointment of a successor; notified Adobe on March 9, 2026; will remain as Chair of the Board of Directors; no separation terms disclosed

• Chair, Special Committee Frank Calderoni — Lead Independent Director of Adobe; appointed by the Board of Directors to chair a special committee to direct the CEO succession process, considering both internal and external candidates; effective March 9, 2026; no additional committee assignments disclosed

• On March 9, 2026, Shantanu Narayen notified Adobe of his decision to transition from his role as Chief Executive Officer
• Mr. Narayen will remain as Adobe's CEO until his successor is appointed; he will also remain as Chair of Adobe's Board of Directors
• Adobe is conducting a search for Mr. Narayen's successor, considering both internal and external candidates
• Frank Calderoni, Lead Independent Director of Adobe, has been appointed by the Board of Directors as Chair of a special committee to direct the CEO succession process