For the projected fiscal year 2025, Adobe's anticipated revenue stands at $23.4 billion, which is notably below the analyst consensus of $23.8 billion.

The expected earnings per share (EPS) are suggested to be in the range of $20.20 to $20.50, again falling short of the $20.52 predicted by analysts.

Coinciding with the earnings announcement, HSBC analysts Stephen Bersey, Abhishek Shukla, and Govinder Kumar opined that Adobe struggles to effectively monetize its AI capabilitiesThey consequently adjusted their target price for Adobe shares from $536 to $510, retaining a "hold" rating

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At the close of business yesterday, Adobe shares were valued at $549.93, indicating a potential decline of approximately 7.26%.

During a conference call, Adobe's management emphasized their strategy focused on expanding AI products, claiming it is crucial to strike a balance between promoting these products and monetization effortsNonetheless, HSBC posits that this approach may only result in moderate revenue growth, lacking the explosive financial success Adobe aims for in the near term.

Despite the rollout of AI products at the beginning of 2024, Adobe's revenue growth over the past three fiscal years has remained stagnant at about 10-11%. The earnings guidance for 2025 suggests a further slowdown, forecasting a growth rate drop to 9%, which is below the consensus expectation prior to the reportAnalysts commenting on the situation stated:

"We believe Adobe is struggling with effectively monetizing its AI capabilities, as the efforts invested in AI have not translated into increased revenue growth."