r/wallstreetbets
ADBE: Wall Street thinks AI is coming for Adobe’s lunch. I think Adobe already put it behind a paywall and called it dinner.
Long ADBE: AI expands Adobe's market by improving usability, backed by strong financials and a cheap 13x P/E valuation.
- AI improves product usability, expanding the total addressable market to beginners while retaining professionals.
- Adobe has already integrated AI features into existing products with a massive built-in user base and workflow lock-in.
- Strong financial performance combined with an attractive valuation of roughly 13x P/E for a high-margin SaaS company.
I’m long ADBE because the market is reading AI backwards.
The bear case: AI makes creative work easier, so Adobe dies.
I think that misses the point.
Adobe’s issue was never demand. Photoshop, Illustrator, Premiere, Acrobat, and Creative Cloud are industry standard tools.
The issue was usability.
A normal person opens Photoshop, sees 400 buttons, and decides the image was fine anyway.
AI fixes that.
Adobe is already putting AI into its products: Firefly, Generative Fill, background removal, image extension, Acrobat AI, video tools, and generative credits.
This is already in the product, not some 2032 investor deck fantasy.
Adobe does not need to build distribution from zero. It already has designers, agencies, marketers, editors, enterprise teams, freelancers, students, and every office worker who has ever aged four years editing one sentence in a PDF.
AI does not shrink Adobe’s market. It expands it.
Professionals stay for workflow, precision, file formats, collaboration, licensing, compliance, and enterprise controls.
Beginners finally get Adobe without needing therapy after opening Photoshop.
Financially, this is not an AI SPAC running on vibes.
Adobe reported $6.40B quarterly revenue, up 12% YoY, EPS of $4.60 GAAP / $6.06 non-GAAP, ARR of $26.06B, and $2.96B operating cash flow.
The stock is around $223, roughly a $92B market cap, about 13x P/E.
For a high-margin recurring-revenue software company with deep workflow lock-in, that does not look priced for perfection.
First entry: $221.50.
Second entry: $205.82.
At that point I am no longer an investor. I am a Creative Cloud subscription in human form.
Position: long ADBE.
Duality of man
https://preview.redd.it/h0uzifsfwo6h1.jpeg?width=968&format=pjpg&auto=webp&s=8a5d2b4d66ac516fab6ea6dd68b75da93b1e051a
wait adobe really put ai behind a paywall already?
I mean all their products are behind a big subscription and like every other saas company, they're just adding AI to their products so yeah
Shit is gonna dump on earnings unless they say they made 18 gorillion dollars and partnered with SpaceX to put photoshop AI datacenters on the moon.
You called it.
That's... brilliant.
I think you are right but don't expect the market to be rational about it.
The market will catch up eventually. They can’t say no to these sweet, sweet earnings cannons for long.
if this post is acknowledging lunch can be dinner then I am on your side, if you are calling supper dinner then no way your DD is accurate since you do not know what dinner is
Here in the North of England we call dinner 'tea' and lunch 'dinner'. Not sure how that affects the stock market though.
Adobe users have hated Adobe for the last 2 decades but we're still using it.
I have no idea what could dislodge Adobe but it's not going to be AI. They recently added a "rotate 2D object in 3D" tool that's AI assisted and it's probably the most useful implementation of AI I've seen yet.
That's the future. Not tweaking prompts but tools that change or transform aspects of an image with user input.
We're talking about a 90B company that has pledged 25B in share buybacks. The valuation is getting silly. They just need a catalyst.
He went broke on 0DTE's so he can't afford it anymore.
https://preview.redd.it/p3dur9akfp6h1.jpeg?width=870&format=pjpg&auto=webp&s=f4658d9da8325d4d0a3e28bfc8de66cb885ca363
Been long for a month and this stock fucking sucks
Most designers absolutely still use Adobe, by a huge margin.
Think about it this way: did you use Adobe or AI to write this post?
Did you use a toothbrush or a shoes to clean your teeth in the morning?
until we use the other tools... then its back to adobe. for all their faults, Illustrator & InDesign are dope
There has yet to be any sort of real competition in this area. Nothing even comes close to the adobe suite. Unfotunately.
Adobe had a record earnings and stock tanking…
AI doesn't expand their userbase -- normies don't have a reason to use photoshop because they can already edit photos with AI using ChatGPT and the like. Literally the default apple/android photo apps have AI photo editing now. Photoshop is still a convoluted mess except now it's bundled in random AI features.
The bull case on the company should be built on the fact that it is the industry leader, but the outlook of the whole industry is bearish because of the larger implication that AI may replace workers.
As an industry professional, ADBE products are overpriced.
Too many free alternatives. For all of them.
Join the watch partyyy https://x.com/\_benjaminstalk/status/2065157328001798518?s=46
Adobe has no moat.
Zero.
Zilch.
Nada.
It's not a company that knows AI.
Have you used their AI in projects? It's a shit show.
Worse than that for your thesis, it feels old. Clunky. Like when old people try to adopt behaviors from their grandkids because they want to be cool.
Like when Microsoft tried to get into the phone business because they thought they could have a go at Apple.
Who tf would like to generate a photo in Firefly when you have much better AI image generators out there.
Adobe has nothing on the likes of Google, for example.
In Google Flow, for example, you work with a blend of AI and deterministic asset layer. You save your assets in a folder and then indicate in the text box that you want a pull from that folder by using @ asset\_name.
It's only a matter of time where Assets will be supplanted by Camera Positions, Camera Movements, Actors, Sounds, Background, Color Grade, and so on.
All this to be integrated in a 3D model that will allow you place assets in that world, model the environment as you see fit, define the camera movement throughout the scene, blend sounds in, and apply final grade.
What is Adobe offering?
Saying that they moved 20 buttons into this one AI agent?
Who gives a shit if their agent is trash?
Adobe doesn't know AI.
It's toast.
Done.
You're going to be making entire movies pretty soon with a conditional generation model like Flow.
You ain't gonna make them with anything Adobe will release, I can tell you that.
What's up with all of these people using AI to write on WSB? It seems every DD on here is using AI nowadays.
Also, as someone who uses both photoshop and AI extensively, ADBE is cooked. ADBE's moat is gone, which is why they're tanking.
a 12pe actually sounds reasonable for a company that may get destroyed by AI or bolstered. It's a risk either way, so you get 12.
Good luck with it, I'll remain in the Chips stocks for now
This is a "DD" without fancy forms/charts/stats. I think it is a signal of inverse WSB.
Yoloing on ADBE puts.
as much as i don'jt want this to be true. with my luck adbe will shit the bed tonight. went in on calls cuz i feel like what op is saying is true, but the market don't care about true.
Yep. What people are getting wrong is that these companies are going to integrate the AI to make their software more appealing. Also all the enterprise clients are not just going to up and switch their whole production environments on a whim.
AI image generation and chatbots have been out for a while now, but Adobe's growth has stayed completely consistent. I think the Earnings tonight are going to show that everything is business as usual. I expect a pop in price.
The cope is real
Hopefully it’s a paperclip buddy you have to pay to get rid of or he’ll bug you all day and steal your work and your data
same 339 usd x 300 pcs = bad entry 😃
The problem is artists hate AI with a passion. I haven't seen more resistance to AI from any other group than photoshop users. 100% of them think AI is here to take their jobs, and they consider any AI produced art a soulless abomination that you can't touch. They would much rather start with a blank canvas than AI generated draft. Sooner or later this will change, but it will take awhile to change that mindset.
On the ither hand easy money Adobe writer is gone with LLMs writing pdf document editing code in 5-mins.
Loud angry users are kind of a good sign in software. It means even those that are fed up stay because there is nowhere else to go.
Software is all about natural monopolies, luring people in and then squeezing.
I like Adobe for e-signing. Its a name people recognize and doesn't cost a fortune like DocuSign
This image is a bit dated but its a good start. When you dive into more specific industries you'll find even more alts.
https://preview.redd.it/njr9pgneer6h1.png?width=1080&format=png&auto=webp&s=07aa3d43aeb765b6c3aff1dffe6aeafd2b3c5fbb
Of all of these, I’ve used GIMP, Darktable, and Inkscape. Adobes products are miles better than all of them. Gimp is god awful, darktable is way more complex and unintuitive, Inkscape is fine if you aren’t a professional.
Have you used any of these?
Oddly enough - none of the programs I use as alts are really on this list. I mostly work in the animation and illustration space, I use Clip Studio, Toon Boom, TV Paint, Dragon Frame, Procreate, Moho, Blender as alternatives.
In the pipelines that I work with for my day job the only program I've had a hard time replacing is After Effects. If I spent some time with it, I'm fairly certain everything I do in AE could be done in Blender or DaVinci.
Curious - How big is your agency? What's the work volume at $40k vs just hiring a junior designer to handle touch ups?
There is simply nothing worse in my opinion than Adobe forcing AI into Acrobat. That shit hogs memory and can’t tell its asshole from its elbow, but it is so fucking invasive. Worst product I’ve seen.
I've commented on this before, but everyone who uses Adobe products for work fucking hates it.
If you actually use photoshop, you'll know how dogshit the credit system is; everything costs credit, and the regular consumer / hobbyist is getting priced out. Secondly any type of basic editing that you wanted to do before can simply be done through an AI prompt; "remove the people in the background, and boost the shadows of the trees". Yes, the AI prompt is less accurate than manually doing it yourself, but with how expensive Adobe is getting, majority of regular consumers can't afford the credit system