Adobe faces investor doubts amid AI disruption

Adobe is facing skepticism about its ability to compete in the creative market with AI products disrupting ￰0￱ lack of confidence is despite efforts by Adobe to integrate rival AI models into its ￰1￱ ￰2￱ trying to prove it can remain a key player in the creative industry as artificial intelligence changes how people make ￰3￱ company gathered about 10,000 marketers, filmmakers, and creators at its annual conference this week to highlight how its software is adapting to the AI ￰4￱ is attempting to retain investor confidence Many on Wall Street are unsure if Adobe can maintain its dominance as new AI-powered tools make it easier for people to create videos, posters, and graphics without professional ￰5￱ analyst Tyler Radke warned that Adobe is “at risk of structural AI-driven competitive and pricing pressure,” even though the company has a strong ￰6￱ company’s shares have lost roughly a quarter of their value this ￰7￱ software firms like Salesforce ￰8￱ Workday Inc.’s stock prices have also ￰9￱ of the popular AI tools used for creating videos and images, such as OpenAI’s Sora or Google’s Veo, are made outside Adobe’s ecosystem.

Consumer-focused platforms like Canva are also growing in popularity, allowing people to design without needing Adobe’s professional software. Bloomberg’s analyst estimates suggest Adobe’s Digital Media revenue growth will slow over the next few ￰10￱ this, analysts like Kirk Materne from Evercore ISI described Adobe’s recent move as “another step toward addressing the ‘existential risk’ question” about the effect of generative AI on its business. Adobe’s strategy At the conference in Los Angeles, Adobe introduced several new features aimed at keeping AI-focused creators within its ￰11￱ of the biggest additions is of AI models from competitors like Google and OpenAI into Adobe’s tools, including ￰12￱ years, the company promoted its in-house Firefly AI models, which were trained to avoid copyright issues and offensive ￰13￱ has already been used to create more than 29 billion images and other assets since launch.

However, Adobe is now also buying access to third-party AI models and offering them directly to its ￰14￱ allows creators to choose between Adobe’s Firefly and external AI systems depending on their ￰15￱ makes about $250 million a year from its AI products, but it says AI helps its business in more ways than ￰16￱ company now uses a broader term called “AI-influenced revenue,” which means any money earned with help from AI, such as charging higher prices or keeping more ￰17￱ Adobe’s estimate, AI affects about $5 billion of its yearly revenue. Adobe’s chief technology officer for its creative business, Ely Greenfield, pointed out that many customers use Firefly for commercial projects but turn to other AI models for brainstorming or experimental work.

“People are getting more comfortable with the idea that models are trained on a large number of things,” Greenfield ￰18￱ Ader from KeyBanc noted that customers at the event were enthusiastic about the expanded AI options. “We welcome the strategy as we have been skeptical of Adobe’s ability to compete on the like-for-like merits of AI image and video generation,” he wrote. Adobe’s CEO, Shantanu Narayen, insisted that his firm’s software remains essential for creators who want professional-quality results, and its stock price struggles are mainly due to investors’ distraction with semiconductor companies and AI model ￰19￱ seen where it ￰20￱ in Cryptopolitan Research and reach crypto’s sharpest investors and builders.