Adobe Faces a Turning Point as AI Disruption Forces $280 Price Target Cut
Generative AI is chipping away at Adobe’s edge from ideation to workflow—and Wall Street just slammed the brakes
Adobe (ADBE, NASDAQ) trades around $379.31 today, slightly up after a turbulent week that saw its stock hit a post-downgrade low. Analyst Omar Sheikh at Rothschild & Co. Redburn downgraded ADBE to “Sell,” slashing the price target from $420 to $280. The reason? A growing wave of generative AI challengers—Midjourney, Sora, Google’s Imagen and Veo—are stealing Adobe’s core turf.
The threat isn’t just hype. These tools now handle the ideation phase, and soon—with fully editable, multi-layered capabilities via conversational interfaces—they could tackle editing and workflow by 2027. The result: Adobe’s pricing power, built on Creative Cloud leadership, is weakening. Redburn projects free cash flow growth decelerating from 8% to just 3% by 2030, pressing valuation down toward 13× earnings from today’s ~19×.
Yet Adobe isn’t standing still. A solid Q2 beat—$5.06 EPS on $5.87 billion revenue—and optimistic full-year guidance showcase resilience. But with stiff competition and a stalled Figma acquisition, investor patience may be limited.
What’s next? Adobe could pivot by acquiring next-gen AI imaging, supercharging Firefly, spinning off a low-tier competitor, or even considering a sale. Until they move, pressure could mount. Still, with most analysts bullish (average target ~$484), this dip may be a red flag or buying opportunity, depending on your AI thesis.
Adobe Inc. (ADBE) is a stock listed on the NASDAQ. The price is 379.31 USD currently with a change of 1.05 (0.28%) from the previous close. The intraday high is 383.10 USD and the intraday low is 377.50 USD. The latest open price was 378.00 USD and the intraday volume is 2,863,680.