Adobe (NASDAQ: ADBE) announced that Chief Executive Officer Shantanu Narayen will step down after 18 years in the role, with the company’s board launching a search for his successor. The company also reported quarterly results that exceeded analyst expectations and issued current-quarter guidance that was largely above forecasts. Shares fell more than 7% in premarket trading Friday.
For fiscal first quarter 2026, the San Jose, California-based software company reported adjusted earnings of $6.06 per share on revenue of $6.40 billion. Analysts had expected earnings of $5.86 per share on revenue of $6.28 billion.
Adobe is widely known for its creative software suite, including Photoshop and Premiere Pro, and has expanded its focus into artificial intelligence with Adobe Firefly, a generative AI platform for creating images, video, audio, and vector graphics.
At the end of the quarter, Adobe reported annualized recurring revenue (ARR) of $26.06 billion and remaining performance obligations totaling $22.22 billion. Net new ARR of $400 million declined roughly 11% year over year, with management attributing the slowdown to challenges in the traditional Adobe Stock business and timing issues related to monetizing freemium offerings.
Looking ahead, Adobe forecast fiscal second-quarter adjusted earnings between $5.80 and $5.85 per share on revenue ranging from $6.43 billion to $6.48 billion. Analysts currently expect earnings of $5.70 per share on revenue of $6.43 billion.
