Citi Lowers Adobe (ADBE) PT to $366 Ahead of Earnings, Maintains Neutral Rating on Anticipated Revenue Beat but Lowered Margin Forecasts

Adobe Inc. (NASDAQ:ADBE) is one of the most profitable tech stocks to buy. On December 4, Citi lowered the firm’s price target on Adobe to $366 from $400, while keeping a Neutral rating on the shares. This announcement was made ahead of the company’s Q4 2025 earnings report. The firm anticipates that the company will slightly exceed its revenue estimates but has lowered its margin forecasts.

In the previous quarter, Adobe achieved record revenue of $5.99 billion in Q3 2025, which marked 10% year-over-year growth. GAAP EPS reached $4.18, which showed an 11% growth and Non-GAAP EPS reached $5.31, which rose by 14%. Reflecting this confidence and momentum, the company raised its full-year 2025 revenue target to a range of $23.65 to $23.70 billion, and its Q4 revenue target to between $6.075 and $6.125 billion.

Citi Lowers Adobe (ADBE) PT to $366 Ahead of Earnings, Maintains Neutral Rating on Anticipated Revenue Beat but Lowered Margin Forecasts

The company’s performance was driven by its two main segments. The Digital Media segment, which includes Creative Cloud and Document Cloud, generated $4.46 billion in revenue, growing 11% year-over-year. This growth was supported by strong demand for AI-infused offerings, causing the Digital Media ARR to grow 11.7% to $18.59 billion. The Digital Experience segment reported revenue of $1.48 billion, representing 9% year-over-year growth. Critically, Adobe’s internally tracked AI-influenced ARR surpassed $5 billion.

Adobe Inc. (NASDAQ:ADBE) operates as a technology company worldwide. The company has a strategic alliance with HUMAIN for the development of generative AI models and AI-powered applications.

While we acknowledge the potential of ADBE to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than ADBE and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.