UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________________

FORM 10-K

(Mark One)


☒			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended November 2928, ~~2024~~2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 0000-15175

ADOBE INC.

(Exact name of registrant as specified in its charter)

_____________________________


Delaware			77-0019522
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

345 Park Avenue, San Jose, California 95110-2704

(Address of principal executive offices)

(408) 536-6000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common Stock, $0.0001 par value per share	ADBE	NASDAQ

Securities registered pursuant to Section 12(g) of the Act: None

_____________________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The aggregate market value of the registrant’s common stock, $0.0001 par value per share, held by non-affiliates of the registrant on May 3130, ~~2024~~2025, the last business day of the registrant’s most recently completed second fiscal quarter, was $~~164~~144.6594 billion (based on the closing sales price of the registrant’s common stock on that date). ~~Shares~~The of the registrant’s common stock held by each officer and director and each person who owns 5% or more of the outstanding common stock of the registrant have been excluded in that such persons may be deemed to be affiliates. This determination of affiliate status for this calculation is not necessarily a conclusive determination for other purposes. As of January 39, ~~2025~~2026, ~~435~~410.35 million shares of the registrant’s common stock, $0.0001 par value per share, were issued and outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Proxy Statement for the registrant’s ~~2025~~2026 Annual Meeting of Stockholders (the “Proxy Statement”), to be filed within 120 days of the end of the fiscal year ended November 2928, ~~2024~~2025, are incorporated by reference in Part III hereof. Except with respect to information specifically incorporated by reference in this Form 10-K, the Proxy Statement is not deemed to be filed as part hereof.

ADOBE INC.

FORM 10-K

TABLE OF CONTENTS

		Page No.
PART I
Item 1.	Business	3
Item 1A.	Risk Factors	2317
Item 1B.	Unresolved Staff Comments	3429
Item 1C.	Cybersecurity	3529
Item 2.	Properties	3630
Item 3.	Legal Proceedings	3630
Item 4.	Mine Safety Disclosures	3630
PART II
Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	3731
Item 6.	[Reserved]	3731
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	3832
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	5144
Item 8.	Financial Statements and Supplementary Data	5346
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	9387
Item 9A.	Controls and Procedures	9387
Item 9B.	Other Information	9387
Item 9C.	Disclosure Regarding Foreign Jurisdictions That Prevent Inspections	9387
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	9488
Item 11.	Executive Compensation	9488
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	9488
Item 13.	Certain Relationships and Related Transactions, and Director Independence	9488
Item 14.	Principal Accountant Fees and Services	9488
PART IV
Item 15.	Exhibits, Financial Statement Schedules	9589
Item 16.	Form 10-K Summary	9791
Signatures		9892
Summary of Trademarks		100

Table of Contents

Forward-Looking Statements

In addition to historical information, this Annual Report on Form 10-K contains “forward-looking statements” within the meaning of applicable securities laws, including statements related to our product development plans and new or enhanced offerings; our business, strategy, artificial intelligence (“AI”) and innovation momentum; our ~~strategy,~~ market and AI opportunity and future growth; market and AI trends; ~~current~~ macroeconomic conditions; fluctuations in foreign currency exchange rates; strategic investments; ~~industry~~customer ~~positioning;~~success and ~~customer~~groups; ~~acquisition~~ and ~~retention~~industry positioning. In addition, when used in this report, the words “will,” “expects,” “could,” “would,” “may,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “targets,” “estimates,” “looks for,” “looks to,” “continues” and similar expressions, as well as statements regarding our focus for the future, are generally intended to identify forward-looking statements. Each of the forward-looking statements we make in this report involves risks, uncertainties and assumptions based on information available to us as of the date of this report. Such risks and uncertainties, many of which relate to matters beyond our control, could cause actual results to differ materially and adversely from these forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed in the section titled “Risk Factors” in Part I, Item 1A of this report and elsewhere herein. The risks described herein and in Adobe’s other filings with the U.S. Securities and Exchange Commission (the “SEC”), including our Quarterly Reports on Form 10-Q to be filed in fiscal ~~2025~~2026, should be carefully reviewed. Undue reliance should not be placed on the forward-looking financial information set forth in this report, which reflects estimates based on information available as of the date of this report. Adobe assumes no obligation to, and does not currently intend to, update these forward-looking statements.

“Adobe,” “Acrobat,” “Photoshop,” “Adobe Firefly,” “Adobe GenStudio” and other trademarks of ours appearing in this report are our property. All other trademarks are the property of their respective owners.

PART I

ITEM 1. BUSINESS

OVERVIEW

Adobe’s mission is ato ~~global~~empower ~~technology~~everyone ~~company~~to ~~with~~create. aWe ~~mission~~build toinnovative ~~change~~platforms ~~the~~and ~~world~~tools ~~through~~that unleash creativity, productivity and personalized ~~digital~~customer experiences. For over four decades, ~~Adobe’s~~our innovations have transformed how ~~individuals,~~people ~~teams,~~everywhere ~~businesses, enterprises, institutions, and governments~~ engage ~~and interact~~ across all types of media. ~~Our~~Adobe’s ~~products, services and~~ solutions are ~~used around~~ the ~~world~~foundation toof ~~imagine,~~digital ~~create~~experiences, ~~manage,~~starting ~~deliver, measure, optimize and engage~~ with ~~content~~the ~~across~~first ~~surfaces and fuel digital experiences. We have a diverse user base that includes consumers, communicators,~~ creative ~~professionals~~spark, ~~developers,~~to ~~students,~~the ~~small~~creation and ~~medium~~development ~~businesses and enterprises. We are also empowering creators by putting the power~~ of ~~artificial~~all ~~intelligence~~content ~~(“AI”) in their hands,~~ and ~~doing so in ways we believe are responsible. Our products and services help unleash creativity~~media, ~~accelerate~~to ~~document~~the ~~productivity~~personalized ~~and~~delivery ~~power~~across ~~businesses~~every ~~in a digital world~~channel.

~~OFFERINGS~~Our focus revolves around serving our customer audiences: business professionals, consumers, creators, creative professionals and marketing professionals. The massive opportunity and evolving role of creativity across roles and industries have driven Adobe’s growth over the past four decades and are expected to continue to drive our growth going forward as we evolve our solutions and routes to market to anticipate the growing needs of our customers. In the artificial intelligence (“AI”) era, we are harnessing the power of AI across our solutions by bringing together our commercially safe first-party and leading partner AI models best suited for the job; deploying conversational and agentic capabilities across offerings; ensuring ubiquity on all surfaces; delivering trusted and secure solutions; and expanding our global presence.

WeAdobe’s ~~deliver~~value aproposition ~~wide~~is ~~range~~to ofempower ~~products,~~creative ~~services~~expression across multiple media types and ~~solutions~~channels, toat ~~empower~~scale, ~~our~~in ~~customers~~a collaborative and ~~users~~secure environment, with an end-to-end ~~imagine~~integrated ~~and~~platform ~~express~~spanning ~~ideas~~ideation, ~~create~~creation, ~~content~~production and ~~bring~~activation. ~~any~~We ~~digital~~power ~~experience~~the toentire ~~life.~~content Weworkflow ~~focus~~with ~~our~~Adobe’s ~~strategic~~AI ~~investments~~platform, inwhich ~~two~~offers ~~areas~~customers ofbrand ~~growth:~~safety, compliance, intellectual property protection, and reliability.

~~Digital~~STRATEGY ~~Media.~~& We provide products, services and solutions that enable individuals, teams, businesses, enterprises, institutions, and governments to create, publish and promote their content anywhere, and accelerate their productivity by transforming how they view, share, engage with and collaborate on documents and content creation. Our Digital Media segment is centered around Adobe Creative Cloud and Adobe Document Cloud, which include Adobe Photoshop, Adobe Illustrator, Adobe Lightroom, Adobe Premiere Pro, Adobe Acrobat, Adobe Acrobat Sign, Adobe Express, Adobe Firefly and many more products, offering a variety of tools for creative professionals (like photographers, graphic designers, video editors and game developers), communicators and other consumers. This is the core of what we have delivered to customers and users for decades, and we have continually evolved and expanded our Digital Media business model to provide our customers and users with a range of flexible solutions to help them reach their full creative potential.OPPORTUNITY

~~Digital~~Adobe’s ~~Experience.~~strategy Weis ~~provide~~to anempower ~~integrated~~our ~~platform~~customer ~~and~~audiences—business ~~set~~professionals, ofconsumers, ~~products~~creators, ~~services~~creative professionals and ~~solutions~~marketing ~~through~~professionals—to ~~Adobe~~be ~~Experience~~more ~~Cloud~~creative, ~~that~~productive ~~enable~~and ~~businesses~~successful. toUnderpinning ~~create,~~our ~~manage,~~customer-focused ~~execute,~~solutions ~~measure,~~is ~~monetize~~our AI strategy and ~~optimize~~Adobe’s ~~customer~~AI ~~experiences~~platform. ~~Our~~As ~~customers~~a ~~include~~technology ~~marketers,~~leader ~~advertisers,~~that ~~agencies,~~unleashes ~~publishers~~creativity, ~~merchandisers,~~productivity ~~merchants,~~and ~~web~~customer ~~analysts~~experience orchestration, ~~data~~we ~~scientists,~~deliver ~~developers~~end-to-end ~~and~~professional ~~executives~~creative ~~across~~and ~~the~~marketing ~~C-suite~~solutions. ~~The~~We ~~foundation~~support of our ~~offering~~customers isto ~~Adobe~~transform ~~Experience~~the ~~Platform,~~way ~~which~~they ~~provides~~connect ~~businesses~~ with antheir ~~open~~customers and ~~extensible~~bring ~~system~~creativity ~~for~~and ~~customer~~marketing ~~experience~~together ~~management~~in ~~that~~new ~~transforms~~and ~~customer~~powerful ~~data~~ways ~~into~~through ~~robust~~a ~~customer~~connected ~~profiles~~ecosystem ~~that~~of ~~update~~tools, inagents ~~real~~and ~~time~~workflows. We are scaling differentiated digital and ~~uses~~enterprise ~~insights~~routes to ~~deliver~~market ~~personalized~~and ~~digital~~automated ~~experiences~~workflows ~~across~~to ~~various~~expand ~~channels~~our brand value and global reach.

WeCustomer ~~offer~~Groups a comprehensive suite of products, services and solutions to our customers in our Digital Media business and Digital Experience business. With Adobe GenStudio, our cross-cloud, end-to-end solution that packages offerings across Digital Experience and Digital Media, enterprises can automate, optimize and accelerate their content supply chains for Strategy

We drive our strategy through customer-specific product innovation and go-to-market motions focused on two customer groups: Business Professionals & Consumers and Creative & Marketing Professionals. We continue to focus on several key

Table of Contents

~~marketing~~growth ~~campaigns~~drivers ~~and~~among ~~personalized~~our customer ~~experiences~~groups. WeThis ~~believe~~includes weexpanding ~~are~~relationships ~~well~~and ~~positioned~~engagement towith ~~deliver~~existing ~~value~~customers, indriving ~~both~~new ~~the~~customer ~~Digital~~adoption, ~~Media~~delivering value-driven and ~~Digital~~innovative ~~Experience~~solutions ~~strategic~~in ~~areas~~new ~~where~~categories across desktop, web and mobile, and increasing our ~~mission~~geographic toreach. ~~change~~We ~~the~~continue ~~world~~to ~~through~~scale ~~personalized~~our digital ~~experiences~~and ~~has~~enterprise ~~never~~routes ~~been~~to ~~more~~market ~~relevant~~as well as ~~people~~our ~~seek~~extensive ~~new~~partner ~~ways~~ecosystem to ~~create,~~expand ~~collaborate~~our ~~and~~addressable ~~communicate~~market and ~~businesses~~deliver ~~continue~~on toour ~~invest in digital transformation~~strategy.

~~SEGMENTS~~Business Professionals & Consumers

~~Our~~Creativity ~~business~~and isproductivity ~~organized~~are ~~into~~merging ~~three~~and ~~reportable~~changing ~~segments:~~how everyone communicates digitally. Business professionals and consumers seek intuitive, all-in-one solutions that seamlessly integrate creativity and productivity across web and mobile. They require tools to digest and gain insights from vast amounts of information and data. They value ease of use, enabled by freemium models that provide accessible entry points to powerful tools that span document consumption and content creation. AI-powered features and conversational interfaces are increasingly replacing traditional templates, offering dynamic and personalized workflows that enhance efficiency.

~~•Digital~~For ~~Media;~~Business Professionals & Consumers, we are democratizing productivity and creativity with AI-driven, quick and easy applications (“apps”) that enable users to be creative and productive whether consuming or generating content across multiple media types and channels. With Acrobat Studio, which brings together Adobe Acrobat and Express to deliver more product value, we are evolving Acrobat from a leading document productivity app to an integrated destination for people to get insights faster, create standout content and collaborate more seamlessly. Our Acrobat solutions, from our freemium Acrobat Reader to Acrobat AI Assistant to our AI-powered productivity and creativity destination, Acrobat Studio, facilitate frictionless onboarding and scaled reach in serving the billions of potential users in this customer group.

~~•Digital~~Creative ~~Experience;~~& ~~and~~Marketing Professionals

~~•Publishing~~Creators and ~~Advertising~~creative professionals need AI-driven solutions that provide power and precision from ideation and creation to production and delivery. They want a powerful destination for creative expression and access to leading AI models. They require seamless collaboration capabilities, powerful ideation tools, conversational and agentic AI solutions and flexible access to web, mobile, and desktop applications to meet the growing demand for high-quality, personalized content in a fast-paced digital economy.

~~These~~As ~~segments~~AI ~~provide~~fundamentally ~~Adobe’s~~transforms ~~senior~~content ~~management~~production, ~~with~~distribution aand ~~comprehensive~~monetization, ~~financial~~our ~~view~~solutions ofaccelerate ~~our~~creative ~~key~~expression ~~businesses.~~for ~~Our~~creators ~~segments~~and ~~are~~creative ~~aligned~~professionals ~~around~~and enable anyone to create by using the AI functionality infused in our ~~two~~flagship ~~strategic~~creative ~~growth~~applications ~~opportunities~~as ~~further~~well ~~described~~as ~~below~~our AI-first solutions. We offer an end-to-end, ~~and~~ideation-to-creation platform powered by our ~~legacy~~commercially ~~products,~~safe ~~services~~Firefly models and ~~solutions~~an ~~are~~expansive ~~contained~~partner ~~within~~model ecosystem, offering customers choice and flexibility without the ~~third~~friction ~~segment,~~of ~~Publishing~~switching between workflows and ~~Advertising~~platforms.

~~MARKET~~Marketing ~~OVERVIEW~~professionals require AI-driven solutions that enable them to create, manage and optimize personalized digital experiences at scale and to enhance brand visibility across the content supply chain. They need agility, self-service capabilities, and integrated workflows to collaborate effectively with creative teams and agencies and meet the increasing demand for compelling content.

~~This~~For ~~overview~~marketing ~~provides~~professionals, anwe ~~explanation~~unify ofcreative production and marketing execution with comprehensive content supply chain solutions that deliver end-to-end customer experience orchestration solutions, automate workflows and personalize experiences and engagement at scale across channels. Centered around Adobe Experience Platform and apps and Adobe GenStudio, our ~~markets~~offerings streamline the content supply chain and adeliver ~~discussion~~agile, ofself-service ~~strategic~~capabilities ~~opportunities~~and inintegrated ~~fiscal~~workflows ~~2025~~to collaborate effectively and ~~beyond~~efficiently ~~for~~produce ~~each~~high volumes of ~~our~~on-brand, ~~segments~~personalized content to strengthen brand visibility. ~~See~~Our competitive differentiation comes from the ~~section~~increased ~~titled~~value ~~“Results~~we provide customers by integrating the Adobe Experience Platform with our comprehensive set of ~~Operations”~~solutions inand ~~Part~~embedding IIAI into our portfolio of solutions, ~~Item 7~~such ~~titled~~as ~~“Management’s~~Adobe ~~Discussion~~Experience Platform AI Assistant. Adobe Experience Platform is a customer data platform that serves as a foundation in enterprises for digital customer engagement and ~~Analysis~~brings oftogether ~~Financial~~AI-powered ~~Condition~~apps and ~~Results~~agents ofto ~~Operations”~~efficiently drive engagement and ~~Note~~loyalty. 2Through ofAI-powered features and AI agents, our ~~Notes~~solutions enable businesses to ~~Consolidated~~provide ~~Financial~~real-time ~~Statements~~orchestration of ~~this~~customer ~~report~~journeys ~~for~~and ~~further~~help ~~segment~~marketers ~~information~~deliver impactful, data-driven campaigns while optimizing return on investment. Our innovations empower our customers to use their first-party customer data and deliver more relevant, high-impact advertising experiences rooted in direct consumer and business relationships.

~~Digital~~Creative ~~Media~~and marketing professionals have increasingly interconnected objectives and workflows in the content lifecycle. Creative professionals produce high-quality content, while marketing professionals leverage this content to deliver personalized, data-driven digital experiences at scale. Adobe’s integrated solutions, such as GenStudio and Firefly Services, bridge the gap between content creation and marketing execution, enabling seamless collaboration and efficiency across these roles. This unified approach reflects Adobe’s strategy to address the entire content lifecycle—from ideation to activation—ensuring alignment, scalability, and value for both creative and marketing functions.

Opportunity

In today’s digital world, content and digital documents are fueling the global economy, and productivity, design and creativity have never been more relevant, providing a significant market opportunity for Adobe in digital media. Everyone has a story to tell and needs products and services at their fingertips to tell those stories on an ever-increasing number of canvases. AI- and generative AI-powered technologies are increasing this opportunity by growing the demand for and production of content. This shift is changing how creative professionals work by accelerating their processes, increasing their productivity, and allowing them to explore and create in new fields, while empowering new creators by dramatically lowering barriers to creativity. At the same time, creativity is increasingly a team effort that is redefining productivity, making quick and easy collaboration even more critical to every company’s success. Adobe is driving innovation to shape these trends, democratize creativity, empower individuals to create wherever inspiration strikes and enable more effective collaboration between creators and stakeholders.

The flagship of our Digital Media business is Adobe Creative Cloud, a subscription service that allows subscribers to use our creative products and applications (“Apps”) integrated with cloud-delivered services across various surfaces and platforms. We believe in creativity for all, and Creative Cloud addresses the needs of all content creators, from creative professionals, such as artists, designers, developers, students, and administrators, to knowledge workers, marketers, educators, enthusiasts, communicators, and consumers. Our customers rely on our products for content creation, photo editing, design, video and animation production, mobile App and gaming development, and more. Our customers can choose between products optimized for different platforms and capabilities, from the speed and ease of use offered by Adobe Express, our AI-first, task-based web and mobile App, to the greater power and precision of our flagship Creative Cloud Apps. We believe we have significant opportunities to grow our Digital Media business by advancing every creative category across all surfaces; expanding content-first, task-based creativity with Adobe Express; enabling seamless collaboration across all stakeholders; inspiring the creative community through sharing and monetization; and expanding the user base of our tools through the infusion of AI into our products, services and solutions to enable users of any skill level to easily and efficiently create content.

Our Digital Media segment includes our Adobe Document Cloud business, a unified, cloud-based document services platform that integrates Adobe’s pioneering PDF technology with our Adobe Acrobat, Adobe Scan and Adobe Acrobat Sign Apps to deliver fully digital document workflows across all surfaces. We have the opportunity to continue to accelerate document productivity with Adobe Document Cloud and transform how people view, share, collaborate, and engage with documents. Trillions of PDF documents are created every year, reflecting the important role PDF plays globally. There are hundreds of millions of users who engage with PDF files on a daily basis in industries such as legal, financial services, and publishing, as well as a broad array of communicators and Adobe Acrobat Reader customers who use the expanded capabilities provided by our Acrobat Apps and the document services platform in Adobe Document Cloud.

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AI Strategy

~~Our~~AI ~~goal~~represents ~~for~~a ~~our~~generational ~~Digital~~opportunity ~~Media~~to ~~business~~serve isan increasingly large and diverse customer universe. Adobe’s approach to beAI ais ~~leading~~rooted ~~platform~~in ~~for~~the belief that creativity is a uniquely human trait – and ~~digital~~that ~~document~~AI ~~solutions,~~has ~~where~~the wepower ~~offer~~to aassist ~~range~~and ofamplify ~~products~~human ingenuity and ~~services~~enhance ~~that~~productivity. ~~allow~~Adobe’s ~~anyone~~AI toleadership builds on our expertise across core creative categories like imaging, design, illustration and ~~deliver~~video ~~content~~as ~~seamlessly.~~well Weas ~~aim~~digital todocuments ~~achieve~~and ~~this~~digital ~~goal~~experiences. byOver ~~using~~the ~~data-driven~~past ~~customer~~several ~~engagement~~years, ~~driving~~we ~~product-led~~have ~~growth~~incorporated toAI ~~allow~~into our solutions and delivered hundreds of AI capabilities to enable customers to create, ~~content~~work and ~~interact~~collaborate ~~with~~more ~~documents~~efficiently. inTo ~~ways~~address ~~that~~our ~~are~~customers’ ~~more~~need ~~frictionless~~for a holistic approach for their productivity, ~~efficient~~creativity and ~~accessible~~marketing needs, ~~and~~Adobe’s ~~meeting~~strategy infuses AI across our ~~customers’~~apps, ~~needs~~embeds ~~holistically~~purpose-built toagents ~~increase~~in ~~the~~our ~~value~~applications, ~~they~~provides ~~derive~~choice ~~from~~of models and harnesses our ~~services~~unique data assets to deliver comprehensive and easy-to-use solutions.

WeApplications ~~are~~and ~~redefining~~Interfaces. ~~the creative process with~~ Adobe ~~Creative Cloud to unleash everyone~~’s ~~ability~~AI toplatform ~~imagine~~powers ~~and~~the ~~express~~applications ~~ideas. We are empowering enterprises~~ and ~~users~~interfaces ~~beyond~~that ~~creative~~customers professionals, such as novice content creators and communicators, to create, edit, schedule and share content quickly and easily using Adobe Express, which makes select capabilities from products like Adobe Photoshop, Adobe Premiere Pro and Adobe Acrobat easy to use ~~for~~every ~~users~~day atacross ~~any~~their ~~level. With Adobe Acrobat Pro~~creative, ~~subscribers~~productivity ~~have full convert~~ and ~~edit~~marketing ~~capabilities,~~workflows ~~advanced~~by ~~e-signature~~bringing ~~features~~together ~~including~~innovations ~~bulk~~across ~~send and custom branding~~agents, ~~advanced~~models ~~protection~~ and ~~additional PDF features~~data. WeThese ~~continue~~integrations toincrease ~~add~~the ~~collaboration~~value ~~capabilities~~that ~~into~~ our ~~flagship~~product ~~products,~~portfolio ~~Apps~~delivers ~~and workflows, and~~ to ~~infuse AI into our creative Apps to help our~~ customers ~~and users work faster and smarter,~~ with ~~new~~a ~~models~~unified ~~for~~experience ~~images~~across ~~and vector graphics, and AI-powered video features natively integrated into~~ our ~~flagship products~~solutions. We ~~are~~drive ~~building~~higher ~~our~~customer ~~own~~engagement ~~foundation models in areas where we have domain expertise~~ and ~~which~~retention weby ~~believe~~enhancing ~~are most relevant to~~ our ~~customers,~~existing solutions and ~~partnering~~infusing ~~with third-party~~ AI ~~models~~in ~~and large language models to further expand the capabilities of~~ our ~~products.~~core Weapplications ~~expanded Adobe Firefly with the launch of Adobe Firefly Services, which help organizations automate content production; Custom Models, which enable enterprises to train~~ and ~~customize~~launching ~~models to support brand consistency amongst creative and marketing teams; Firefly Video Model (public beta), which enables generative text~~AI-~~to-video~~first ~~and image-to-video; and Firefly Image 3 Foundation Model, which allows for faster and higher-quality image generations~~applications. ~~Developing our own foundation models enables us to design Firefly to be commercially safe and in line with our AI Ethics principles of accountability, responsibility and transparency.~~

Agent Orchestration. We ~~continue~~use toour ~~pursue~~unique ~~ways~~data assets to ~~inspire~~design and implement AI agents that generate insights and content, ~~empower~~make recommendations and ~~connect~~optimize engagement and customer experience outcomes across our product portfolio. We are building agents on the ~~creative~~Adobe ~~community~~Experience Platform, informed by our deep understanding of our customers’ needs and ~~support~~the ~~live,~~complexity ~~interactive~~of ~~tutorials~~delivering ~~with~~content ~~creators.~~at ~~Additionally~~scale, ~~with~~to ~~Adobe~~redefine ~~GenStudio~~and simplify the future of customer connection by automating decision-making, optimizing workflows and ~~Adobe~~enabling ~~GenStudio~~real-time ~~for~~orchestration ~~Performance~~of ~~Marketing~~content, adata ~~generative~~and journeys. We offer AI~~-first~~ ~~product~~assistants powered by agents that ~~natively~~unlock ~~integrates~~creativity ~~Digital~~and ~~Media~~allow for conversational creation and ~~Digital~~editing. ~~Experience~~Our ~~offerings,~~agents weand ~~help~~agentic ~~enterprises~~solutions toin ~~quickly~~our ~~create~~Acrobat ~~on-brand~~offerings ~~content~~streamline ~~variations~~workflows, drive efficiency, unlock productivity and accelerate ~~their~~time ~~marketing~~to ~~workflows~~value. ~~Further~~Our ~~descriptions~~agents ofand agentic solutions are expanding our ~~Digital~~user ~~Media~~base ~~products~~across ~~are~~our ~~included~~customer ~~below~~groups ~~under~~by ~~“Principal~~reducing ~~Products,~~the ~~Services~~need for traditional onboarding and ~~Solutions~~training to unlock the value of AI solutions.”

Models. In ~~our Creative Cloud business, we employ our product-led growth strategy to minimize~~ the ~~friction~~rapidly ofevolving ~~customer~~AI ~~interactions and drive positive product experiences~~landscape, ~~which~~where ~~results~~each ingenerative ~~increasing~~AI ~~adoption,~~model ~~usage,~~has ~~conversion,~~its ~~expansion~~own ~~and loyalty. We also continue to employ a pricing strategy~~strength, aswe ~~appropriate,~~offer ~~to migrate our~~ customers toflexibility ~~higher-value offerings as well as attract past customers and potential customers~~ to ~~try~~use ~~out~~the ~~our~~model ~~products~~of ~~and~~their ~~ultimately~~choice ~~subscribe.~~directly Wewithin ~~use~~certain ~~a data-driven operating model and our~~ Adobe ~~Experience Cloud~~ solutions to ~~drive~~best ~~and~~serve ~~optimize~~their ~~customer awareness, engagement and licensing of our creative products and services at every stop of the customer journey through our website and across other channels~~needs. Adobe~~.com~~ isModels: ~~the~~We ~~central~~build ~~destination~~our ~~where~~own wecreativity-focused, ~~engage~~commercially ~~individual~~safe ~~and~~Firefly ~~small~~foundation ~~business~~models ~~customers to sign up~~ for generation and ~~renew~~editing ~~Creative~~across ~~Cloud subscriptions~~categories. ~~Our~~Partner ~~customers~~Models: ~~have~~We ~~the~~partner ~~flexibility~~with toan ~~subscribe~~extensive toecosystem ~~over twenty~~ of ~~our~~third-party ~~Creative~~models ~~Cloud~~across ~~products through a single subscription or, for many of our Apps, through various collections of our individual subscriptions to point products~~categories. ToWithin ~~better serve our current users and potential users, we offer free and premium levels for~~ certain ~~Apps and targeted packages and suites. Further~~applications, ~~our~~customers ~~generative~~can AIchoose ~~capabilities~~from ~~are increasing the value of~~ our ~~existing~~Adobe ~~subscription~~Firefly ~~products,~~models ~~expanding our potential customer base~~ and ~~increasing~~partner ~~engagement~~models ~~and~~to ~~retention~~meet ~~through~~their ~~Generative~~creativity, ~~Credits—credits~~productivity ~~that provide users~~ and ~~subscribers~~marketing ~~the ability to generate content with Adobe Firefly~~needs. ~~The~~Our ~~collaboration~~focus ~~features~~on ~~across~~controllability ~~many~~is ofdesigned ~~our products help us~~ to ~~further~~align ~~expand~~with our ~~universe~~customer’s ~~of customers beyond~~ creative ~~professionals~~intent, toallowing ~~other stakeholders who use our products~~ for ~~review~~preferred ~~and approval~~input, ~~copywriting~~customization, ~~social~~precise ~~media~~refinement, ~~marketing~~iterative orcontrol ~~other~~and ~~social~~seamless ~~content~~integration ~~creation.~~across ~~We utilize channel partners to target mid-size creative customers with~~ our ~~Creative Cloud for Teams offering~~apps. ~~Our~~Customized ~~direct~~Models: ~~sales~~We ~~force~~offer isthe ~~focused~~ability onfor ~~building~~individuals ~~relationships with our largest customers~~ and ~~driving~~enterprises ~~adoption~~to oftrain ~~our~~Firefly ~~Creative~~generative ~~Cloud~~AI ~~for~~models ~~Enterprise~~tailored ~~offering. Overall, our strategy with Creative Cloud is designed~~ to ~~enable~~their usspecific torequirements ~~deliver customer value, increase our revenue~~ with ~~existing~~their ~~customers,~~own ~~attract new customers and grow a recurring and predictable revenue stream that is recognized ratably~~assets.

InData. ~~our~~As ~~Adobe~~AI ~~Document~~continues ~~Cloud business, we expect~~ to ~~drive~~change ~~sustained~~content ~~long-term~~creation, ~~revenue~~our ~~growth~~customers, ~~through~~particularly ancreators ~~expansion~~and ofenterprises, ~~our~~increasingly ~~customer~~require ~~base~~responsible, bysecure ~~continuing~~and ~~to employ our product~~human-~~led~~centered ~~growth~~AI ~~strategy;~~solutions. ~~deliver~~In ~~the~~developing ~~best~~our ~~PDF~~Firefly ~~experience~~foundation onmodels, ~~and~~we ~~across~~responsibly ~~every~~harness ~~platform;~~our ~~improve~~unique ~~Acrobat~~data ~~web’s~~assets ~~functionality~~ and ~~ease~~help ofour ~~use;~~customers ~~and~~amplify ~~expand~~ the ~~number~~value of ~~digital~~their ~~document and workflow~~first-~~based~~party ~~actions in Acrobat~~data. WeAdobe ~~are~~leverages ~~driving~~a ~~innovation~~rich ~~with~~dataset ~~Acrobat~~sourced AIfrom ~~Assistant,~~licensed ~~our~~content ~~generative~~and ~~AI-powered~~public ~~tool~~domain inassets ~~Adobe~~to ~~Acrobat~~train ~~Pro,~~our ~~Acrobat~~Firefly ~~Standard~~generative ~~and~~AI ~~Acrobat~~models ~~Reader,~~ that ~~allows~~are ~~users~~commercially tosafe ~~better~~for ~~and~~our ~~more~~customers. ~~quickly~~This ~~understand~~approach ~~their~~respects ~~documents~~creator ~~with~~rights ~~quick~~and ~~answers~~builds ~~and~~trust ~~generative~~among AIenterprise ~~summaries~~customers, ~~and~~enabling ~~Adobe~~them ~~Sensei,~~to ~~our~~confidently ~~cross-platform~~use AI-generated ~~and~~outputs ~~machine~~in ~~learning~~production ~~technology~~workflows. toWe ~~make~~also ~~documents~~work ~~more~~with ~~intelligent~~our ~~and~~customers ~~responsive.~~to ~~Additionally,~~help ~~with~~them ~~the~~manage, ~~integration~~gain ofinsights ~~Adobe~~from ~~Firefly~~and inunlock ~~Acrobat,~~the ~~our~~power ~~customers~~of ~~can~~their ~~easily~~first-party ~~generate~~data and ~~edit~~assets, ~~visuals~~and ~~directly~~build incustomized ~~PDFs.~~models Weand ~~are~~solutions ~~unlocking~~using ~~business~~such ~~workflows~~data ~~through PDF~~ and ~~Adobe~~assets ~~Acrobat~~stored ~~Sign~~in ~~Application~~our ~~Programming~~applications, ~~Interfaces~~systems, ~~(“APIs”);~~and ~~accelerating~~through ~~Document~~connections ~~Cloud~~to ~~adoption~~other ~~through~~business ~~digital and~~ applications.

COMPETITION

We participate in a highly competitive and rapidly evolving environment where our competitors include companies of various sizes and both public and private companies, including large, global companies and smaller companies with more specialized focuses, new entrants, and AI or cloud-native companies. We compete with software companies, AI companies, hardware manufacturers, operating system developers, and social media companies across our business. The markets for our solutions are characterized by rapid technological innovation, new industry standards, evolving distribution and sales models, limited barriers to entry, short product lifecycles, customer price sensitivity, global economic conditions and the frequent entry of new solutions or competitors.

Our future success will depend on our ability to effectively appeal to customers and accurately predict and meet changing customer needs by enhancing our existing solutions and introducing new ones in a timely and cost-effective manner. We need to anticipate emerging standards, business models, software delivery methods, and other technological changes.

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~~direct~~Our ~~sales;~~solutions ~~and~~for ~~deploying~~business ~~diversified~~professionals ~~go-to-market motions to reach all industries~~ and ~~businesses~~consumers offace ~~all~~broad ~~sizes.~~competition ~~With~~from ~~over~~productivity ~~100~~tools ~~million~~and ~~online searches for PDF~~consumer-~~related~~focused ~~actions~~creative ~~per~~tools ~~month,~~including wegeneral ~~intend~~productivity toplatforms ~~harness that demand~~ and ~~attract~~apps, ~~new users and customers to our Document Cloud services through Acrobat~~ web,- ~~which allows anyone to quickly access tools to create, edit, convert, sign~~ and ~~compress~~mobile-first ~~PDFs~~design ~~through their web browser. As with our Creative Cloud strategy~~platforms, wean ~~utilize~~array aof ~~data~~easy-~~driven operating model~~ to ~~market our Document Cloud solutions and optimize our subscription~~-~~based~~use ~~pricing~~desktop, ~~for~~web ~~individuals as well as small~~ and ~~medium~~mobile ~~businesses,~~content ~~large~~creation ~~enterprises~~apps, ~~students~~AI-first ~~and~~creativity ~~education users,~~ and ~~government~~productivity institutions around the world. We utilize our corporate and volume licensing programs to increase our reach in our key markets and are continuing to focus on marketing and licensing Acrobat in targeted vertical markets such as educationtools, ~~financial~~presentation ~~services~~tools, ~~telecommunications~~ and ~~government,~~social ~~and~~media onplatforms ~~expanding~~that ~~into~~offer ~~emerging markets. We will continue to engage~~ built-in ~~strategic~~media ~~partnerships~~editing ~~to help expand our distribution reach and drive the enterprise business~~capabilities.

AsOur ~~our~~solutions ~~Document~~for ~~Cloud~~creators ~~customers~~and ~~increasingly~~creative ~~expect~~professionals ~~business~~face ~~processes~~broad tocompetition befrom ~~seamless~~both ~~across~~established ~~surfaces~~ and ~~the~~emerging ~~web,~~players weincluding ~~are~~professional ~~expanding~~tools ~~our~~and ~~Document~~suites ~~Cloud capabilities to meet this need. Adobe Acrobat is available on the web, delivering quick results~~ for ~~common PDF actions with a single click. Users can ask questions using voice commands with Acrobat AI Assistant on mobile devices. Adobe Scan powers mobile devices with scanning capabilities~~imaging, ~~transforming paper documents into full-featured PDFs. Adobe Acrobat Sign provides a green alternative to costly~~video, ~~paper-based solutions and offers a convenient solution for our customers to digitally manage their documents~~design, ~~automate processes and contract workflows~~3D, and isother ~~integrated~~creative ~~into~~tasks, ~~Acrobat~~purpose-built ~~across all surfaces. Acrobat Reader is available on~~ mobile ~~devices~~apps, ~~and features~~ AI-~~powered~~first ~~“Liquid~~creative ~~Mode”~~tools, ~~to automatically reformat PDFs for quick navigation and easier consumption on smaller screens. With features offered by AI Assistant and Adobe Firefly~~ as well as ~~new~~creative ~~capabilities~~tools tointegrated ~~Acrobat,~~into ~~Adobe~~broader ~~Scan~~desktop, ~~and Acrobat Sign~~web, ~~we help our customers~~ and ~~users~~mobile ~~continue to migrate away from paper-based processes and adopt our solutions for personalized, digital document experiences, growing our revenue with this business in the process~~applications.

~~Digital~~Our ~~Experience~~solutions for marketing professionals face broad competition from large, established enterprise software and cloud companies, point solutions from smaller, specialized companies, new companies constantly entering the digital experience space as well as business’ internally developed apps. Key competitive factors in this environment include proven performance, security, scalability, flexibility, and reliability of the platform; breadth of functionality & strategic integrations with third parties; cost-effective benefits; enterprise-level service & training; and ability to integrate across business workflows.

~~Opportunity~~Adobe continues to build on its strong foundation of research and development, transformative innovation, category and brand leadership and world-class financial discipline. We deliver Adobe magic to an expanding set of global customers and are executing on the opportunity ahead. We are a trusted partner to companies of all sizes who look to our integrated ecosystems and connected workflows across creativity, productivity, and marketing to stand out and grow their brands.

~~Consumers~~See today buy experiences, not just products, and they demand personalized digital experiences that are relevant, engaging, seamless and secure across an ever-expanding range of channels and surfaces. Businesses increasingly have the ~~same~~section ~~expectations,~~titled ~~driving business-to-business (~~“~~B2B”)~~Risk ~~companies to deliver equally engaging and seamless experiences as business-to-consumer (“B2C~~Factors”) ~~companies.~~contained ~~With~~in ~~AI-powered~~Part ~~automation and personalization~~I, ~~people~~Item ~~and~~1A ~~brands will increasingly stand out through unique creative expression, and the future~~ of ~~experiences~~this ~~across~~report ~~industries~~for ~~and~~additional ~~everyday~~information ~~life~~regarding ~~will~~risks ~~become~~related increasingly personalized. Delivering the best, personalized experience at a given moment requires the right combination of data, insights and content across multiple channels in real time and at scale. We have a strategic opportunity to provide solutions that enable real-time personalization at scale and accelerate our customers’ content supply chain, with a streamlined and coordinated process from content ideation through deployment, measurement and optimizationcompetition. Marketing is also increasingly evolving from a centralized discipline to a multi-practitioner, cross-functional, collaborative field, and marketing and IT teams are looking for a return on investment to demonstrate the business impact of their transformation initiatives.

~~Adobe~~PRINCIPAL Experience Cloud is powering businesses by helping them provide exceptional personalized experiences to their customers via a comprehensive suite of solutions. Addressing the challenges of customer experience management is a large and growing opportunity and we are in position to help businesses and enterprises invest in solutions that aid their goals to transform how they engage with their customers and constituents digitally.SOLUTIONS

~~Strategy~~Business Professionals & Consumers

~~Our~~Acrobat goal is to be a leading provider of cloud-based solutions for delivering digital experiences and enabling digital transformation. Adobe Experience Cloud Apps and services are designed to manage customer journeys, enable personalized experiences at scale and deliver intelligence for businesses of any size in any industry. Adobe Experience Platform further strengthens our differentiation by offering a way to connect our comprehensive set of solutions. Further descriptions of our Digital Experience products are included below under “Principal Products, Services and Solutions.”

~~Adobe~~Acrobat ~~Experience~~is ~~Cloud~~our ~~delivers~~family of productivity solutions that allows users to consume, edit, sign, and create documents across platforms and surfaces, and better understand the information within them. Our Adobe Acrobat solutions are available on desktop, mobile, and the web with Acrobat Studio, Acrobat Pro, Acrobat Standard tiered plans, and for free with Adobe Acrobat Reader. Acrobat AI Assistant, our ~~customers~~generative ~~across~~AI-powered conversational engine, gives users the ~~following~~power ~~strategic~~to ~~growth~~work ~~pillars:~~more productively with their PDFs by summarizing and answering questions about documents, providing intelligent citations and quickly generating and formatting content for sharing. Acrobat AI Assistant is available in Acrobat Studio and offered as an add-on to Acrobat Pro, Acrobat Standard and Acrobat Reader.

~~•Data~~Acrobat ~~insights and audiences. Our products deliver actionable data to our customers in real time to enable highly tailored and adaptive experiences across platforms.~~Studio

~~•Content~~Acrobat Studio is an all-in-one platform for productivity and creation that unites Adobe Acrobat, ~~commerce~~Adobe Express and ~~workflows.~~AI ~~Our~~agents ~~products~~to ~~help~~enable ~~our~~people ~~customers~~to ~~manage~~quickly, ~~deliver~~easily and intuitively work. Users can gain insights with specialized AI assistants, ~~personalize~~create interactive workspaces with PDF Spaces, and ~~optimize~~transform content ~~delivery;~~using ~~build~~Adobe ~~multi-channel~~Express—all ~~commerce~~in ~~experiences~~one place. Acrobat Studio integrates Acrobat’s AI capabilities with its PDF features. PDF Spaces turns collections of files and websites into sharable, conversational knowledge hubs with personalized AI Assistants, transforming PDFs from static files into a dynamic environment for ~~B2B~~uncovering insights, generating ideas, surfacing recommendations, and ~~B2C~~synthesizing ~~customers;~~information. ~~strategically~~Adobe ~~plan~~Express creation capabilities, trusted PDF tools and agentic AI make it easy to create, edit and share documents and visual content in the same place.

Adobe Acrobat

Adobe Acrobat is our comprehensive PDF solution with a full set of tools to convert, edit, share and sign PDFs across various surfaces and platforms. Acrobat enables automated, collaborative workflows with a rich set of commenting, editing and sharing tools and direct integration with Adobe Acrobat Sign. With the Acrobat Standard plan, subscribers can convert, edit, request signatures, and protect PDFs. The Acrobat Pro plan offers additional advanced PDF features.

Adobe Acrobat Reader

Adobe Acrobat Reader, our free software for reliable viewing, annotating and printing of PDF documents on a variety of surfaces and platforms, offers features to create, edit, export, combine, share and collaborate on PDF documents, including the “Liquid Mode” feature that automatically reformats PDFs for quick navigation and consumption on mobile devices.

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~~manage,~~Adobe ~~collaborate and execute on workflows for marketing campaigns and other projects at speed and scale; and leverage self-serve capabilities to deliver on-brand content.~~Express

~~•Customer~~Adobe ~~journeys~~Express is our all-in-one AI content creation app for users of any level, such as novice content creators and communicators, to easily create video, marketing, and social content. ~~Our~~Users ~~products~~can ~~help~~easily ~~businesses~~design ~~manage~~high-impact design elements, ~~test~~engaging videos and images, ~~target~~resumes, PDFs, animation and ~~personalize~~content ~~customer~~ready ~~journeys~~for ~~delivered~~social asmedia ~~campaigns~~channels ~~across~~and ~~B2B~~platforms. Adobe Express integrates with other Adobe solutions allowing customers to accelerate, streamline and ~~B2C~~scale ~~use~~on-brand ~~cases~~content creation.

~~Our~~Creative ~~goal~~& isMarketing to deploy our capabilities to help enterprises generate highly engaging experiences, enable content creators to enhance creativity and scale content production, and provide marketing strategists with recommendations to improve marketing strategy and enhance the delivery of personalized customer journeys. In our Adobe Experience Cloud, we believe our innovations, natively embedded AI services, and end-to-end content supply chain solutions enhance the delivery and personalization of digital experiences by allowing our customers to gain insights and understand their data, simulate outcomes, automate tasks, generate audiences, create content, optimize marketing campaigns and enable the delivery of more relevant and personalized customer journeys. Adobe Experience Cloud offers domain-specific AI services in areas such as attribution and automated insights, customer journey management, lead management, sentiment analysis, one-click personalization, enhanced anomaly detection and more that work with Adobe Experience Platform to augment our Experience Cloud product offerings. By building on these features and capabilities, we increase the value we provide our customers and create a competitive differentiation in the market.Professionals

Adobe ~~Experience~~Creative Cloud offers an open platform and ecosystem through Adobe Experience Platform. Adobe Experience Platform’s open system transforms businesses’ customer data from across their Adobe solutions and third-party software into robust customer profiles. These profiles are updated in real time and include AI-driven insights, allowing a brand to deliver the right customer experiences across channels and deliver true one-to-one personalization. This open architecture offers scalability with a wide variety of supporting products and services and empowers businesses to quickly develop innovative Apps to interact with their customers and enables a broad industry ecosystem.Pro

~~To drive growth of~~ Adobe ~~Experience~~Creative Cloud, wePro ~~focus~~is ona ~~delivering on~~cloud-~~brand,~~based ~~customer~~subscription ~~engagement,~~to ~~growth~~an ~~within~~ecosystem ~~existing~~of ~~customer~~apps ~~accounts,~~that ~~product~~enables ~~differentiation~~creative ~~and~~professionals ~~the best customer experience management solutions for B2B~~ and ~~B2C~~enthusiasts ~~buyers~~alike ~~across enterprise and mid-market segments. We intend~~ to ~~pursue~~express ~~growth~~themselves ~~through a scaled go-to-market approach focused on C-suite partnerships, transformational accounts, continued customer acquisition, customer value realization~~ and ~~solution~~collaborate ~~expansion.~~with Weapps ~~utilize a direct sales force to market~~ and ~~license~~services ~~our~~for ~~Experience~~photography, ~~Cloud solutions~~design, ~~as well as an extensive ecosystem of partners~~video, ~~including~~social ~~marketing agencies~~media, ~~systems integrators~~ and ~~independent~~more ~~software~~that ~~vendors~~connect ~~that~~across ~~help~~surfaces, ~~license~~platforms and ~~deploy our solutions to their customers~~geographies. WeSubscribers ~~also~~have ~~maintain~~access ~~several strategic partnerships with other technology companies that allow us~~ to ~~increase~~cloud ~~our~~storage ~~market reach. We have made significant investments~~ to ~~broaden~~easily ~~the~~sync, ~~scale~~access, ~~and~~collaborate ~~size of all these routes to market~~ and ~~believe~~share ~~these~~their ~~investments~~work, ~~will~~files ~~result in continued growth in revenue in our Digital Experience segment in fiscal 2025~~ and ~~beyond~~assets.

~~Publishing~~Creative Cloud Pro includes the Adobe Firefly web app, the premium version of Adobe Express, and ~~Advertising~~AI-powered features natively integrated throughout Adobe Photoshop, Adobe Illustrator and Adobe Premiere Pro. All apps listed below and many more are available through subscriptions to Creative Cloud Pro (except Substance 3D Apps, which are sold separately through the Adobe Substance 3D Collection plan), and many of our apps are also available as standalone subscriptions on Adobe.com.

Our Publishing and Advertising segment contains legacy products and services that address diverse market opportunities including eLearning solutions, technical document publishing, web conferencing, document and forms platform, web App development, high-end printing and our Adobe ~~Advertising~~Photoshop ~~offerings. Graphics professionals~~ and ~~professional~~Lightroom publishers continue to require quality, reliability and efficiency in production printing, and our Adobe PostScript and Adobe PDF printing technologies provide advanced functionality to meet the sophisticated requirements of this marketplace. As high-end printing systems evolve and transition to fully digital, composite workflows, we believe we are well positioned to be a supplier of software and technology based on the Adobe PostScript and Adobe PDF standards for this industry.

Adobe ~~Advertising~~Photoshop ~~delivers~~is anthe ~~end-~~world’s most advanced digital imaging and design app, with powerful editing and effects tools to transform photos. Adobe Lightroom is our cloud-~~end~~based photo app that allows subscribers to edit, ~~demand-side~~organize, ~~platform~~store ~~for~~and ~~managing~~share ~~advertising~~photos across ~~digital~~desktop, ~~formats~~tablet, ~~and~~mobile ~~simplifies~~devices and the ~~delivery~~web. ofIn ~~video~~addition to individual subscriptions to Photoshop and Lightroom, ~~display~~we offer a Photography Plan for photographers and ~~search~~photo ~~advertising~~enthusiasts ~~across~~and ~~channels~~includes Photoshop, Lightroom and ~~screens~~Lightroom Classic.

WeAdobe generate revenue in our legacy Publishing products and services by licensing our technology to original equipment manufacturers that manufacture workflow software, printers and other output devices, and we generally generate revenue in Advertising through usage-based offerings. Illustrator

~~COMPETITION~~Adobe Illustrator is our industry-standard vector graphics app used worldwide by designers of all types who want to create digital graphics and illustrations for all kinds of media—print, web, interactive, video and mobile—from web and mobile graphics to product packaging to book illustrations and billboards.

Overview

We participate in a rapidly evolving, highly competitive global environment, where our competitors vary by industry and range from large multinational enterprises to smaller entities with specialized and focused product offerings. Across our business, we recognize hundreds of competitors worldwide. The markets for our products and services are characterized by new industry standards, evolving distribution models, rapid technological innovation, frequent product introductions and short

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product life cycles. Our future success will depend on our ability to enhance our existing products, services and solutions and introduce new ones on a timely and cost-effective basis, accurately predict and meet changing customer needs, provide best-in-class information security to build customer confidence and combat cyber-attacks, extend our core technologies into new Apps and anticipate emerging standards, business models, software delivery methods and other technological changes.

A summary of the competitive environment for each of our business segments is included below. See the section titled “Risk Factors” contained in Part I, Item 1A of this report for additional information regarding risks related to competition.

Digital Media

Our Digital Media segment faces competition from large, established companies and smaller, more recent entrants. These companies offer a variety of products, including multi-product packages, point offerings, free products, websites, downloadable Apps and other products and offerings. We compete in a rapidly evolving and growing market and face significant direct or indirect competition from:

•software companies and AI companies;

•device, hardware, mobile device and camera manufacturers, including those that integrate software and AI capabilities for digital media, such as photo and video, collaboration tools and content creation;

•mobile-first Apps;

•web-native tools and platforms;

•social media platforms that provide digital media offerings, including editing capabilities;

•providers of stock content;

•digital document creation, storage, collaboration and signing providers;

•productivity and presentation tools;

•operating system developers that integrate digital media document viewers and markup features with their operating systems; and

•proprietary and open-source web-authoring tools.

We believe competitive factors in our markets include:

•brand, product features and functionalities;

•integration with related tools, third-party Apps and workflows;

•the intuitiveness and visual appeal of user interfaces;

•demonstrable cost-effective benefits to our customers;

•pricing;

•the flexibility of services to match our customers’ evolving demands;

•the availability, usability and accessibility of our products, services and solutions;

•success in educating our customers in how to utilize services effectively;

•the ability to create and use AI models and integrate AI capabilities for digital media creation, generation, collaboration and editing; and

•responsible and secure data handling and storage protocols.

We attract our customers and users in this segment through our broad and comprehensive array of high-quality products and services, which are powerful, standalone tools that also work well together and complement one another. With Creative Cloud, we believe we compete well with our features and functionality, AI models and capabilities, ease of use, product reliability, value and performance characteristics. For example, with Adobe Firefly, we believe we compete well by offering generative AI models designed to be safe for commercial use and AI capabilities that are natively integrated into our products,

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and with Adobe Express, we believe we compete well by making our creative technologies accessible to a wide audience and enabling easy-to-use, efficient content creation, collaboration and sharing for quick projects. With Adobe Document Cloud, we believe we compete well through our PDF offerings, features and functionalities that are critical tools for millions of business communicators, and our brand.

Digital Experience

Our Digital Experience segment competes in markets that are growing and evolving rapidly and characterized by intense competition. Our Adobe Experience Cloud solutions face competition from:

•large, established companies, including large enterprise software, AI, internet and database management companies;

•point product solutions and focused companies;

•new companies constantly entering the digital experience markets;

•companies that provide Software-as-a-Service (“SaaS”) solutions to our customers, generally through the web and software that is installed by our customers directly on their servers; and

•Our customers’ or potential customers’ internally-developed Apps.

We believe competitive factors in our markets include:

•the proven performance, security, scalability, flexibility and reliability of services;

•the strategic relationships and integration with third-party Apps;

•the intuitiveness and visual appeal of our interfaces;

•demonstrable cost-effective benefits to our customers;

•pricing;

•the flexibility of services to match changing business demands;

•enterprise-level customer service and training;

•brand;

•data governance features and functionality;

•product features and functionality and the usability of services;

•near real-time data and reporting;

•independence from portals and search engines;

•the ability to deploy the services globally;

•success in educating our customers in how to utilize services effectively; and

•the integration and customization of high-quality AI models and the ability to customize and use such AI models.

We believe we compete well with our enterprise and low-cost alternatives based on many of these competitive factors, including:

•our strong feature set;

•the breadth of our offerings, which work well together and complement one another as part of Adobe Experience Cloud;

•our focus on global, multi-brand companies;

•provision of AI through Adobe Sensei AI services;

•our intuitive user experience;

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•tools for building multi-screen;

•tools for managing data across Apps and geographies;

•cross-channel Apps;

•standards-based architecture;

•scalability;

•connecting content creation with digital experience delivery, personalization and optimization; and

•performance.

Publishing and Advertising

Our Publishing and Advertising segment faces competition from large-scale publishing systems and Extensible Markup Language-based publishing companies and smaller desktop-publishing products. Our eLearning solutions and web conferencing products face competition from a number of established products from other large software companies. Competition involves a number of factors, including product features, ease-of-use, the level of customization and integration supported, the number of hardware platforms supported, service and price. We believe we can successfully compete based upon the quality and features of our products, their complementarity with our Adobe Creative Cloud, Adobe Document Cloud and Digital Experience products and our strong brand among users.

PRINCIPAL PRODUCTS, SERVICES AND SOLUTIONS

Digital Media Offerings

Adobe Creative Cloud

Adobe Creative Cloud is a cloud-based subscription to a collection of Apps that enables creative professionals and enthusiasts alike to express themselves and collaborate with Apps and services for photography, design, video, social media, and more that connect across surfaces, platforms and geographies. Subscribers have access to cloud storage to easily sync, access, collaborate and share their work, files and assets.

Creative Cloud paid plans include the Adobe Firefly web App, the premium version of Adobe Express, and AI-powered features natively integrated throughout Adobe Photoshop, Adobe Illustrator and Adobe Premiere Pro. Creative Cloud, Adobe Firefly, and Adobe Express plans include a monthly allocation of Generative Credits, which are tokens that enable subscribers to use our generative AI features to generate content using text-based prompts. All Apps listed below and many more are available through subscriptions to Creative Cloud (except Substance 3D Apps, which are sold separately through the Adobe Substance 3D Collection plan), and many of our Apps are also available as standalone subscriptions on Adobe.com. Adobe Acrobat Pro is available as part of our Creative Cloud All Apps subscription and on a standalone basis and allows users to create, convert and edit PDFs, including text and images. Additionally, certain Creative Cloud Apps, such as Adobe Express, are available in Adobe GenStudio for Performance Marketing, allowing users to quickly use assets and Creative Cloud tools to create on-brand content.

Adobe Photoshop and Adobe Lightroom

Adobe Photoshop is the world’s most advanced digital imaging and design App, with powerful editing and effects tools to transform photos. It is available on desktop, iPad and through a web version. Features include Generative Fill, Generative Expand, Generate Similar and Generate Background, which allow our customers to use text prompts to quickly create, add to, remove, duplicate or replace images, or expand the borders of an existing image with AI-generated content without leaving Adobe Photoshop; the Adjustment Brush Tool, which combines the traditional workflow of selecting, masking, and applying an adjustment into one step, simplifying the way of making local adjustments; and Distraction Removal smart technology to help remove people, wires, poles and other distractions from images. Adobe Lightroom is our cloud-based photo App that allows subscribers to edit, organize, store and share photos across desktop, tablet, mobile devices and the web. Features include Lens Blur to blur the background or foreground by making a depth map of the photo using AI; the Denoise feature to remove noise in RAW photos; People Masking features to automatically select and edit facial hair and clothing; and Generative Remove, which uses Adobe Firefly to remove unwanted objects and distractions in a photo. In addition to individual subscriptions to Photoshop and Lightroom, we offer a Photography Plan, which is a more limited cloud-based offering than Creative Cloud, targeted at photographers and photo enthusiasts and includes Photoshop, Lightroom and Lightroom Classic.

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Adobe Illustrator and Adobe Fresco

Adobe Illustrator is our industry-standard vector graphics App for desktop and iPad used worldwide by designers of all types who want to create digital graphics and illustrations for all kinds of media—print, web, interactive, video and mobile—from web and mobile graphics to product packaging to book illustrations and billboards. Features include Adobe Firefly-powered Generative Recolor, which enables users to generate different color palettes using text prompts and apply them to their illustrations; Objects on Path to empower users to quickly attach, arrange and move an object along any path of their art board; and Enhanced Image Trace to make it easier and faster to convert images to vectors. Adobe Fresco is our free illustration App, available on various surfaces, that brings together the world’s largest collection of vector and raster brushes and AI-powered Live Brushes to deliver a natural painting and drawing experience.

Adobe Premiere Pro

Adobe Premiere Pro is a nonlinear video editing ~~App~~app used by filmmakers, TV editors, YouTubers and videographers. Our customers can import and combine various types of media, from video shot on a mobile device to 8K to virtual reality, and then edit in its native format without transcoding. Automated tools and workflows for color, graphics, audio and immersive 360/VR make the editing process more efficient. Premiere Pro offers Text-Based Editing, which allows our customers to review transcripts or search for keywords to find and edit the right content faster and AI-powered Enhance Speech to remove noise and improve the quality of dialogue clips.

Adobe After Effects

Adobe After Effects is our industry-standard motion graphics and visual effects ~~App~~app used by a wide variety of animators, designers and compositors to create cinematic movie titles, add effects and create animations. ~~With an AI-enhanced Roto Brush, users can cut out objects from footage faster and more accurately than ever.~~ After Effects works together seamlessly with other Adobe ~~Apps~~solutions ~~such~~ as ~~Adobe Premiere Pro, Adobe Photoshop, Adobe Illustrator and Adobe Audition, as~~ well as third party software and hardware partners.

Adobe InDesign

Adobe InDesign is a design and layout App for print and digital media. Our customers use it to create, preflight and publish a broad range of content including books, eBooks, digital magazines, posters and interactive PDFs for print, online and tablet App delivery. Integrations with other Adobe Apps such as Adobe Photoshop, Adobe Illustrator, Adobe Acrobat, Adobe Stock, Adobe Firefly, Adobe InCopy and Adobe Experience Manager expands InDesign’s capabilities and allows our customers to collaborate and share content, fonts and graphics across projects. Our customers can also access Adobe’s digital publishing capabilities from within InDesign to create and publish engaging Apps for a broad range of surfaces.

Adobe Express

Adobe Express is our all-in-one AI content creation App for users of any level, such as novice content creators and communicators, to easily create video, marketing, and social content. Users can easily design high-impact design elements, engaging videos and images, resumes, PDFs, animation and content ready for Instagram, TikTok and other social channels and platforms. The App features guided tools, one-click solutions for quick projects, simple drag and drop functions, collaboration tools, thousands of templates and access to more than 20,000 fonts and the entire Adobe Stock photo collection, and allows users to easily plan, schedule, preview, and publish content all from one place. Adobe Firefly integrated into Adobe Express makes it possible to quickly generate custom images and text effects from text prompts in over 100 languages and is designed to be commercially safe. Also available in Adobe GenStudio and Adobe GenStudio for Performance Marketing, Adobe Express allows marketers to quickly resize and reformat assets to create content variations for any channel. Adobe Express is available on mobile devices and the web. With Adobe Express, Creative Cloud subscribers can easily access, edit and work with creative assets from Adobe Photoshop and Adobe Illustrator directly, or add linked files into Adobe Express that always stay in sync across Apps.

Adobe Firefly, Adobe Firefly Services and Custom Models

Adobe Firefly is our family of creative generative AI models and standalone web App for exploring AI-assisted creative expression. Firefly’s foundation generative AI models allow users to generate images, text effects, design templates, and vector graphics using a text description. Firefly AI models include a version of the Firefly Image Model that generates high-quality images from text prompts, a Firefly Vector Model that generates fully editable vector graphics, a Firefly Design Model that generates fully editable design templates, and a Firefly Video Model (public beta) that generates video from text or image prompts. Firefly supports text prompts in more than 100 languages. In addition, with Adobe Firefly for Enterprise, certain businesses are eligible to obtain an intellectual property indemnification for AI-generated content generated by most Firefly-

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powered workflows. Firefly-powered generative AI features are also available in a number of our products including Adobe Photoshop, Adobe Illustrator, Adobe Express, Adobe Acrobat and Adobe Stock. Firefly is available for free with a limited number of Generative Credits per month. Once that limit is reached, users and subscribers can buy additional Generative Credits through a Firefly paid subscription plan.

Also available for enterprises are Adobe Firefly Services and Custom Models. Firefly Services provides enterprises with APIs, tools and services for content generation, editing and assembly, to automate the production of content while maintaining quality and control. Custom Models enable enterprises to train generative AI models based on their intellectual property, product and brand styles across a wide variety of use cases such as localization or merchandising for e-commerce, maintaining and propagating brand consistency at scale across their organizations.

Adobe Firefly-generated content is designed to be commercially safe. The Firefly generative AI model is trained on data Adobe has the rights to use. Every asset created using Firefly includes Content Credentials, a digital “nutrition label”, to indicate that generative AI was used, bringing more trust and transparency to digital content.

Adobe Stock

Adobe Stock provides designers and businesses with access to millions of high-quality, curated, royalty-free photos, vectors, illustrations, videos, templates, audio and 3D assets, for all their creative projects. Adobe Stock is built into our Creative Cloud Apps, including Adobe Photoshop, Adobe Illustrator, Adobe InDesign and Adobe Express, enabling users to search, browse and add assets to their Creative Cloud Libraries and instantly access them across all connected surfaces. Adobe Stock assets include free and paid collections and may be licensed directly within Adobe’s Apps, through stock.adobe.com or as a multi-asset subscription.

Frame.io

Frame.io is our cloud-native creative collaboration platform that streamlines the production of creative assets by enabling creative professionals and key project stakeholders to collaborate with real-time upload, review and approval, frame-accurate commenting, annotations and more. Frame.io includes support for video beyond post-production workflows including casting, location scouting, footage reviews, and marketing campaign management, as well as still images, design files and PDFs. Frame.io is directly integrated with Adobe Premiere Pro, Adobe After Effects, Adobe Photoshop, Adobe Lightroom and Adobe Workfront to allow video creators to request and receive streamlined frame-specific comments directly in those Apps. Frame.io’s Camera to Cloud functionality allows creators to automatically upload footage from cameras and other recording devices on set directly into Frame.io for review, with integrations for still image cameras that can connect natively to the platform. Frame.io, along with Adobe Express and Adobe Firefly Services, are available in Adobe GenStudio to enable content production at scale.

Adobe Substance 3D Collection

Adobe Substance 3D is an ecosystem of ~~desktop Apps~~apps, including Substance 3D Stager, Substance 3D Painter, Substance 3D Sampler, Substance 3D ~~Designer~~Assets and Substance 3D Modeler. Our customers can build and assemble 3D scenes with Stager, use tools in Painter to texture 3D assets, ~~from advanced brushes to Smart Materials that automatically adapt to your model~~ and use Sampler to digitize and enrich assets. Substance 3D Assets is a 3D materials library from which users can import professional quality 3D textures into their projects and generate infinite texture variations. Substance 3D Modeler, which is available on desktop and certain VR headsets, interprets spatial input from the physical world, allowing the user to sculpt a model as if in a real workshop, using natural, fluid gestures of the artistic flow, and switch between VR and desktop, at every project stage.

~~Behance~~Adobe Stock

~~Behance~~Adobe isStock aprovides ~~social~~designers ~~community~~and ~~for~~businesses ~~creators~~with access to ~~showcase~~millions ~~and~~of ~~discover~~high-quality, ~~creative~~curated, ~~work online and live~~royalty-~~stream~~free ~~their~~photos, ~~skills~~vectors, ~~and~~illustrations, ~~creations~~videos, ~~from~~templates, ~~Creative~~audio ~~Cloud~~and ~~Apps.~~3D ~~Adobe~~assets, ~~Portfolio~~for ~~allows~~all ~~users~~their tocreative ~~quickly~~projects. ~~and~~Adobe ~~simply~~Stock ~~build~~is abuilt ~~fully~~into ~~customizable~~our ~~and~~apps, ~~hosted website that seamlessly syncs with Behance.~~

~~Adobe Document Cloud~~7

Adobe Document Cloud is a cloud-based subscription offering that enables complete, reliable and automated digital document and signature workflows across desktop, mobile, web and third-party enterprise Apps to drive business productivity for individuals, teams, small businesses and enterprises. With Document Cloud, users can create, review, approve, sign and track documents and store them in the cloud for easy access and sharing across surfaces. Document Cloud includes Adobe Acrobat, Adobe Acrobat Sign, Adobe Scan and other Apps and API services that work standalone or integrate with users’ existing productivity Apps, processes and systems.

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~~All~~including ~~the Apps listed below are available through a subscription to~~ Adobe ~~Acrobat. With the Acrobat Standard plan~~Photoshop, ~~subscribers~~Adobe ~~can~~Illustrator ~~convert, edit, request signatures,~~ and ~~protect~~Adobe ~~PDFs. The Acrobat Pro plan~~Express, ~~available~~enabling ~~through both our Creative Cloud and Document Cloud businesses, offers additional advanced PDF features. Acrobat AI Assistant, our generative AI-powered conversational engine, gives our~~ users ~~the power~~ to ~~work more productively with their documents with its ability to summarize and answer questions about documents~~search, ~~provide~~browse ~~intelligent citations~~ and ~~quickly generate and format content for sharing. Acrobat AI Assistant is offered as an~~ add~~-on~~ assets to ~~Acrobat~~their ~~Pro,~~Creative ~~Acrobat~~Cloud ~~Standard~~Libraries and ~~Acrobat~~instantly ~~Reader.~~access Wethem ~~also~~across ~~offer~~all ~~Acrobat~~connected ~~subscription plans for teams and enterprises~~surfaces. Adobe ~~Acrobat~~Stock ~~Sign~~assets isinclude ~~included~~free inand ~~Adobe~~paid ~~Acrobat~~collections ~~subscriptions for individuals~~ and ~~teams.~~may ~~Document~~be ~~Cloud~~licensed ~~for~~directly ~~enterprise~~within ~~includes~~Adobe’s ~~Acrobat~~apps, ~~Acrobat~~through ~~Sign,~~stock.adobe.com ~~and~~or ~~APIs~~as ~~including~~a ~~third~~multi-~~party~~asset ~~partner integrations~~subscription. ~~Acrobat Reader and Adobe Scan are also separately available as free downloads.~~

Adobe ~~Acrobat~~Firefly Solutions

~~At the heart of~~ Adobe ~~Document~~Firefly ~~Cloud~~ is Adobe’s ~~Acrobat,~~family ~~our~~of ~~comprehensive~~creative ~~PDF~~generative ~~solution~~AI ~~with~~models athat ~~full~~span ~~set~~image, ofvideo, ~~tools to convert~~vector, ~~edit~~audio, ~~share~~ and ~~sign PDFs across various surfaces and platforms~~more. ~~Acrobat~~The ~~enables~~Firefly ~~automated,~~family ~~collaborative workflows with a rich set~~ of ~~commenting,~~models ~~editing~~are ~~and~~infused ~~sharing~~across ~~tools and direct integration with~~ Adobe ~~Acrobat Sign. Acrobat~~’s ~~unified~~solutions ~~Share~~and ~~button~~powering ~~combines~~new ~~sharing~~solutions athat ~~link,~~enhance ~~sending the file by email~~creativity, marketing and ~~sharing~~productivity aworkflows ~~file~~for ~~with~~our ~~others~~customers. ~~into~~Through ~~one~~natural ~~streamlined action~~language, ~~simplifying~~reference ~~the~~assets, ~~sharing~~ and ~~review~~intuitive ~~experience.~~interactions, ~~Our~~users ~~Acrobat~~can ~~Chrome~~create and ~~Edge~~edit ~~extensions~~images, ~~allow~~videos, ~~users~~text toeffects, ~~access~~design ~~our~~templates, ~~Acrobat~~vector ~~tools~~graphics, ~~without~~and ~~leaving the web browser~~audio.

Firefly models are commercially safe. They are trained on data Adobe ~~Acrobat~~has ~~Reader~~the rights to use. Every asset generated with Firefly includes Content Credentials, a digital “nutrition label”, to indicate that generative AI was used, bringing more trust and transparency to digital content. In addition, with certain of our enterprise and teams solutions, businesses are eligible to obtain an intellectual property indemnification for AI content generated by most Firefly-powered workflows. Adobe Firefly solutions are available in tiered subscription plans: Firefly Standard, Firefly Pro and Firefly Premium.

Adobe ~~Acrobat~~Firefly Reader, our free software for reliable viewing, annotating and printing of PDF documents on a variety of surfaces and platforms, offers features to create, edit, export, combine, share and collaborate on PDF documents, including the “Liquid Mode” feature that automatically reformats PDFs for quick navigation and consumption on mobile devices. Users of both Acrobat and Acrobat Reader can also access, edit and save changes to their PDF files stored in Adobe Document Cloud, or other third-party cloud storage services.App

Adobe’s ~~Scan~~Firefly app is an AI-powered creative space for content ideation, creation and production. The Firefly app includes access to an expansive partner model ecosystem as well as all of Adobe’s AI Firefly models to allow users to generate images, video, vectors, audio and more from a single place, iterate on their creations across Adobe’s creative apps and seamlessly deliver them into production.

Adobe ~~Scan~~Firefly ~~can~~Custom beModels used for free on mobile devices to provide scanning capabilities in the pocket of every person. It captures paper documents as images and transforms them into full-featured and versatile PDFs via Adobe Document Cloud services for instant sharing with others. Optical character recognition allows users to convert scanned documents into editable, searchable PDF files instantly.

~~Adobe~~Firefly ~~Acrobat~~Custom ~~Sign~~Models enable quick content creation that is on-brand or in an artists’ own aesthetic style through Firefly generative AI image models that are trained with an enterprise’s brand content or an artist’s own person assets.

~~Our cloud-based e-signature service,~~ Adobe ~~Acrobat~~Firefly ~~Sign,~~Foundry allows users securely to send any document electronically for signature across surfaces. Through web and mobile Apps, Acrobat Sign enables users to e-sign documents and forms, send them for signature, track responses in real time and obtain instant signatures with in-person signing. Acrobat Sign also integrates with users’ enterprise systems through a comprehensive set of APIs and Adobe Experience Manager Forms and Advanced Workflows for Acrobat Sign, to create forms and provide seamless experiences to our customers across web and mobile sites.

~~Digital~~Firefly ~~Experience~~Foundry ~~Offerings~~enables enterprises to create deeply-tuned, customized Firefly generative AI models based on their intellectual property, product and brand styles with the support of Adobe scientists and engineers, across a wide variety of use cases.

Adobe ~~Experience~~Firefly Cloud is a comprehensive collection of best-in-class products, services and solutions to manage the customer experience, all integrated into a cloud platform, along with service, support and an open ecosystem. Adobe Sensei uses AI and machine learning technology to analyze large amounts of data and make intelligent in-App recommendations, automate repetitive tasks, and drive real-time decisions within our products. Adobe Sensei GenAI allows customer experience and marketing teams to use natively embedded generative AI to deliver more accurate and personal customer journeys.Services

~~Experience~~Firefly ~~Cloud~~Services, isavailable ~~comprised~~for ofenterprises, ~~the~~provides ~~following~~enterprises ~~sets~~with ofAPIs, ~~solutions~~tools ~~for~~and ~~our~~services ~~customers:~~for ~~Adobe~~content ~~Experience~~generation, ~~Platform;~~editing ~~Data Insights~~ and ~~Audiences; Content~~assembly, ~~Commerce~~to ~~and~~automate ~~Workflows;~~the ~~and~~production ~~Customer~~of ~~Journeys,~~content ~~which~~while ~~are~~maintaining ~~each~~quality ~~described~~and ~~below~~control.

Adobe GenStudio

Adobe GenStudio is an end-to-end, content supply chain solution for ideation, creation, production, activation, delivery, asset management, analytics and insights. It seamlessly brings together Adobe solutions and has integrations with third-party platforms, making it a powerful, connected solution for enterprise content operations. Adobe solutions offered within Adobe GenStudio include Adobe Experience Manager Assets, Adobe Workfront, Firefly Services and Adobe GenStudio for Performance Marketing, a generative AI-first solution that enables marketing teams to use generative AI to quickly create, deliver and optimize on-brand digital experiences to their customers, while allowing brand and creative teams to retain oversight and strategic direction with brand guardrails.

Adobe Experience Platform

Adobe Experience Platform is a purpose-built platform for customer experience ~~management~~orchestration that helps businesses collect, connect and activate their known and unknown customer data from every interaction across sources and channels in real time to create unified customer profiles. Adobe Experience Platform standardizes data for intelligence and profile creation and provides an open and extensible cloud infrastructure, real-time updates, and AI-driven insights and scalability. ~~Federated~~Our ~~Audience~~customers ~~Composition~~can ~~allows~~leverage ~~our~~Adobe ~~customers~~Experience ofPlatform to activate AI-driven insights across apps such as Adobe Real-Time Customer Data Platform, Adobe Customer Journey Analytics and Adobe Journey Optimizer. Additionally, Adobe Experience Platform AI Assistant is a conversational experience that enables creative and marketing professionals to use ~~data~~generative ~~from~~AI ~~their~~and ~~data~~agentic ~~partners~~AI ~~directly~~capabilities to ~~enrich~~enhance ~~existing~~productivity, ~~high-value~~improve ~~audiences~~product mastery and ~~attributes~~accelerate ~~all~~their inworkflow ~~one system~~efficiency. ~~Adobe~~

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Experience Platform also offers Query Service and Data Science Workspace, which enable businesses to gain deeper insights from stored datasets and customer journey intelligence. These tools leverage predefined data-driven operational best practices, AI and business intelligence to enable and optimize real-time decisions, actions and business processes. Our customers can leverage Adobe ~~Experience~~Agent Platform to activate AI-driven insights across all Adobe Experience Cloud Apps in near real time. Adobe Experience Platform AI Assistant is a generative AI-powered conversational interface that answers technical questions, automates tasks, simulates outcomes and generates new audiences and journeys across applications such as Adobe Real-Time Customer Data Platform, Adobe Journey Optimizer and Adobe Customer Journey Analytics. Adobe Experience Platform AI Assistant uses a collection of experience models designed to address the context of each use case and allows for quick data navigation as needed.Orchestrator

~~Data~~Adobe ~~Insights~~Experience Platform Agent Orchestrator is the technology underpinning Adobe’s agentic framework, powering the ability to understand context, retrieve precise information, plan multi-step actions, drive intelligent automation, refine responses, and ~~Audiences~~automate key workflows. Agent Orchestrator is designed to leverage rich data, content, and knowledge from Adobe Experience Platform to power functional agents for customer experience orchestration that accelerate tasks, make decisions, and act as a talent multiplier for customers focused on driving business growth through personalization at scale.

~~Our~~Adobe ~~Data~~Brand Insights and Audiences solutions enable our customers to stitch together their data from across the consumer journey into a single view to provide insights based on every interaction in real time, easily share data and analyses across teams and organizations and use AI and machine learning to optimize personalization. The following is a brief description of our products for Data Insights and Audiences.Concierge

Adobe ~~Analytics~~Brand Concierge is an AI-powered solution that helps enterprises configure and manage AI agents and deliver personalized, immersive and conversational experiences for their customers.

Adobe Analytics ~~helps our customers create a holistic view of their business by turning their customer interactions into actionable insights. Driven by AI~~ and ~~machine learning,~~ Adobe ~~Analytics~~Customer ~~collects,~~Journey organizes and structures vast streams of data from virtually any channel, including streaming web data, to deliver real-time insights that are easy for our customers to process, analyze and share to quickly identify problems and opportunities and to drive conversion and relevant customer experiences. Our customers can use these analytics to continuously improve marketing activities and better direct their marketing spend. Our Analysis Workspace features a drag-and-drop interface that allows our customers to craft an analysis, add visualizations so they can bring data to life, curate a dataset and share and schedule projects across their organization, among other features.Analytics

Adobe ~~Customer~~Analytics ~~Journey~~helps our customers create a holistic view of their business by turning their customer interactions into actionable insights. Driven by AI and machine learning, Adobe Analytics collects, organizes and structures vast streams of data from virtually any channel, including streaming web data, to deliver real-time insights that are easy for our customers to process, analyze and share to quickly identify problems and opportunities and to drive conversion and relevant customer experiences.

Adobe Customer Journey Analytics brings a powerful set of analytics tools that allow our customers to interactively explore and visualize the end-to-end customer journey across multiple channels and utilize AI-powered insights, while making such analytics more accessible across their organization, to ensure that customer journeys flow seamlessly regardless of channel.

Adobe Product Analytics

Adobe Product Analytics enables product teams to self-serve data and insights about their product experience through guided analysis workflows built on cross-channel data from Adobe Customer Journey Analytics. This cross-functional analytics suite allows product teams to partner closely with their marketing and customer experience counterparts to coordinate and deliver more personalized customer experiences across all channels using a single source of data, audience, and metrics. Adobe Product Analytics has native integrations across Adobe Experience Platform, including integrations with Adobe Journey Optimizer and Adobe Real-Time Customer Data Platform that allow product owners to act immediately by publishing real-time audiences for activation.

Adobe Mix Modeler

Adobe Mix Modeler is aan ~~self-serve,~~ AI-powered ~~solution~~marketing ~~that~~measurement ~~helps~~and ~~organizations~~planning ~~measure,~~solution ~~optimize,~~that ~~and~~unifies ~~plan~~ marketing ~~investments.~~mix ~~Adobe~~modeling ~~Mix~~and ~~Modeler~~multi-touch ~~applies~~attribution ~~machine~~into ~~learning~~a ~~models~~single ~~that~~methodology. ~~provide~~It ~~insights~~helps ~~via~~organizations ~~cross-channel,~~quantify ~~summary datasets in Adobe Experience Platform on~~ the ~~historic~~incremental ~~and future~~ impact of ~~marketing~~paid, ~~investments~~earned, onand ~~key~~owned ~~business~~channels, ~~goals.~~optimize ~~This~~budget ~~holistic~~allocation, ~~understanding~~and ofsimulate ~~the~~future ~~top-to-bottom~~outcomes ~~impact~~using ofpredictive ~~campaigns~~analytics. ~~enables~~Mix ~~marketers~~Modeler todelivers ~~measure~~consistent, ~~plan,~~actionable ~~monitor,~~insights ~~and~~across ~~adjust~~ all ~~marketing~~touchpoints ~~campaigns~~ in a single ~~App~~app.

Adobe Real-Time Customer Data Platform

Adobe Real-Time Customer Data Platform is an ~~App~~app service that delivers real-time personalization at scale to enable our customers to bring together and securely collaborate on their first-party customer data to activate in real-time their customer and account profiles that allow for B2B and B2C marketers to deliver timely, relevant experiences across channels. Real-Time Customer Data Platform ~~does~~utilizes ~~this~~an byopen ~~activating~~and aextensible ~~business’~~architecture ~~unified~~that ~~customer~~allows ~~profiles~~integration onwith ~~Adobe~~a ~~Experience~~variety ~~Platform~~of ~~across~~data ~~channels~~sources ~~to leverage intelligent decision making throughout the customer journey~~ and ~~deliver~~activation ~~hyper-personalized~~touchpoints ~~experiences across all known channels~~ and ~~surfaces.~~provides ~~Real-Time~~continuous ~~Customer~~data ~~Data~~refreshes ~~Platform~~to ~~utilizes~~keep antheir ~~open~~customer ~~and~~profiles ~~extensible~~updated ~~architecture~~in ~~that~~near real time.

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allows integration with a variety of data sources and activation touchpoints and provides continuous data refreshes to keep their customer profiles updated in near real time.

Content, Commerce and Workflows

Our Content, Commerce and Workflows solutions help our customers manage, deliver, personalize and optimize on-brand content across web, mobile and App interfaces, as well as enable shopping experiences that scale from mid-market to enterprise businesses, across surfaces and channels. The following is a brief description of our products for Content, Commerce and Workflows.

Adobe Experience Manager

Adobe Experience Manager combines digital asset management with a content management system and an end-to-end digital document solution. Adobe Experience Manager Sites provides a ~~marketer and developer-friendly~~ content management and optimization system built on a scalable, cloud-native foundation to create and deploy personalized experiences across ~~every~~web, ~~channel~~mobile and apps. Adobe Experience Manager Assets offers cloud-native digital asset management to create, manage, deliver and optimize personalized experiences at scale. Adobe Experience Manager ~~is also available in GenStudio for Performance Marketing, allowing marketers to retrieve generated assets and associated metadata for generating campaign assets. Adobe Experience Manager~~ Forms provides a cloud-native and scalable solution for personalized end-to-end digital customer onboarding and enrollment, enabling our customers to create, manage, publish and approve forms and documents.

Adobe ~~Experience~~LLM Manager Screens allows our customers to connect online and in-venue experiences through digital signage. Adobe Developer App Builder provides a set of tools and services for our customers’ developers to extend Experience Manager to their existing infrastructure and apply unique parameters to make the UI look and feel unique for their businesses.Optimizer

Adobe LLM Optimizer is a generative engine optimization solution, helping enterprises improve brand visibility and discoverability across AI-powered search and discovery while providing actionable insights.

Adobe Commerce

Adobe Commerce offers a highly customizable, end-to-end e-commerce platform to manage, personalize and optimize the commerce experience for physical and digital goods across every touchpoint by bringing together digital commerce, order management and predictive intelligence to enable engaging shopping experiences across B2B, B2C and direct-to-consumer. Based on an open-source ecosystem with thousands of third-party extensions, Adobe Commerce extends beyond the online shopping cart to shoppable experiences, with actionable data analysis and automated back-end workflows, native integrations with other Adobe products, such as Adobe Analytics, Adobe Target and Adobe Experience Manager, and the capability to be scalable and extensible.

~~Adobe Workfront~~9

Adobe Workfront provides a unified work management App to enable teams to work more efficiently, with tools to strategize, plan, execute, review and deliver on complex workflows. Integrations with Adobe Creative Cloud and Adobe Experience Manager Assets allow our enterprise customers to scale content production with greater speed and efficiency. Adobe Workfront Planning, offered within Adobe Workfront, streamlines enterprise planning by delivering a comprehensive view of all marketing activities in an organization and enabling teams to be more strategic in planning and execution with full visibility into day-to-day marketing operations.

Adobe GenStudio for Performance Marketing

Adobe GenStudio for Performance Marketing is a generative AI-first product within Adobe GenStudio that enables marketing teams to use generative AI to quickly create on-brand advertisements and emails to deliver relevant and personalized experiences to their customers, while allowing brand and creative teams to retain oversight and strategic direction with brand guardrails. Businesses can import content performance data from third party platforms into Adobe GenStudio for Performance Marketing to understand campaign impact and optimize campaign performance. Adobe GenStudio for Performance Marketing natively integrates Digital Media and Digital Experience offerings, including Adobe Express and Adobe Experience Manager Assets, to optimize the process of planning, creating, managing, activating and measuring content for marketing campaigns and personalized customer experiences.

Customer Journeys

Our Customer Journeys solutions enable our customers to manage and orchestrate individual cross-channel campaigns that encourage meaningful customer experiences, personalize content and deliver optimized experiences at scale that are important to each of their customers and plan, orchestrate and measure engagement with their prospects and consumers at every stage of the customer journey. The following is a brief description of our products for Customer Journeys.

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shopping cart to shoppable experiences, with actionable data analysis and automated back-end workflows, native integrations with other Adobe ~~Marketo~~solutions, ~~Engage~~and the capability to be scalable and extensible.

Adobe Marketo Engage is a customer experience management solution optimized for B2B, cross-channel campaigns by bringing together planning, engagement and measurement capabilities into an integrated marketing platform. Capabilities include lead nurturing and management; predictive account profiling for creating account-based experiences; integrated sales App; and integrations with third-party marketing Apps and Adobe Experience Cloud. Adobe Marketo Engage simplifies how companies plan, orchestrate and measure engagement at each stage of the customer experience, and allows companies to better align marketing and sales to engage high priority accounts.

Adobe Campaign

Adobe Campaign is optimized for managing B2C cross-channel marketing campaigns. Adobe Campaign enables businesses to orchestrate the entire customer journey and use their customer data to create, coordinate and deliver dynamic, personalized experiences that are synchronized across channels, including email, mobile and offline, and determined by their consumers’ behaviors and preferences. Adobe Campaign’s features also include AI-powered email management, multidimensional targeting, in-App messaging and dynamic, customizable reports to analyze success.

Adobe Target

Adobe Target is an AI- and machine learning-driven personalization engine that lets our customers test, target and optimize content across channels. With Adobe Target, our customers have the tools they need to create omnichannel personalized experiences and create A/B and multivariate tests, done at scale through AI-powered automation so they can quickly discover the best experience for their customers and deliver that experience across all touchpoints.

Adobe Journey Optimizer

Adobe Journey Optimizer is a scalable ~~App~~app built on Adobe Experience Platform that allows businesses to orchestrate and deliver personalized, connected customer journeys across any ~~App~~app, surface, screen, or channel across B2B and B2C. With this solution, brands can manage inbound customer engagement with outbound omnichannel campaigns and offer personalized content based on real-time profiles, data-driven insights, cloud-native scalability and API extensibility, all within a single ~~App~~app, and, for our B2B customers, build buying groups aligned to their organization’s product portfolio. Businesses can trigger individual consumer journeys and use real-time insights to personalize that journey, as well as visually map individual journeys across systems in an intuitive, workflow-based interface. Adobe Journey Optimizer also allows our customers to track detailed performance of executed journeys and how individuals are progressing in real time, with data automatically sent to Adobe Experience Platform to allow full-funnel analysis.

~~Other~~Adobe ~~Products,~~Marketo ~~Services and Solutions~~ Engage

WeAdobe ~~also~~Marketo ~~offer~~Engage is a ~~broad~~customer ~~range~~experience ofmanagement ~~other~~solution ~~enterprise~~optimized ~~and~~for ~~digital~~B2B, ~~media~~cross-channel ~~products~~campaigns by bringing together planning, ~~services~~engagement and ~~solutions.~~measurement ~~Information~~capabilities ~~about~~into ~~other~~an ~~products,~~integrated ~~services~~marketing platform. Capabilities include lead nurturing and ~~solutions~~management; ~~not~~predictive ~~referenced~~account ~~here~~profiling ~~can~~for becreating ~~found~~account-based onexperiences; ~~our~~integrated ~~corporate~~sales ~~website,~~app; ~~adobe~~and integrations with third-party marketing apps and Adobe Experience Cloud.~~com.~~

Adobe Workfront

Adobe Workfront provides a unified work management app to enable teams to work more efficiently, with tools to strategize, plan, execute, review and deliver complex workflows. Adobe Workfront Planning, offered within Adobe Workfront, streamlines enterprise planning by delivering a comprehensive view of all marketing activities in an organization and enabling teams to be more strategic in planning and execution with full visibility into day-to-day marketing operations.

SEGMENTS

In fiscal 2025, our business consisted of three reportable segments: Digital Media, Digital Experience and Publishing and Advertising. Spanning both our Digital Media and Digital Experience segments, we drove business success through customer-focused innovation and go-to-market strategies.

Digital Media. To serve the productivity and creativity needs of business professionals, consumers, creators and creative professionals, our Digital Media solutions include our Adobe Acrobat solutions, Adobe Express and our Creative Cloud subscriptions and flagship apps, such as Adobe Photoshop, Adobe Illustrator, Adobe Lightroom, Adobe Premiere Pro and Adobe After Effects, as well as Adobe Firefly.

Digital Experience. To serve the end-to-end content supply chain needs of marketing professionals, our Digital Experience solutions include Adobe Experience Platform and native applications, including Real-Time Customer Data Platform, Customer Journey Analytics, Adobe Experience Manager Sites, Adobe Commerce, Adobe Journey Optimizer, Adobe Marketo Engage and solutions within Adobe GenStudio, such as Workfront, Adobe Experience Manager Assets and GenStudio for Performance Marketing.

Publishing and Advertising. Our Publishing and Advertising offerings contain legacy solutions including eLearning solutions, technical document publishing, web conferencing, document and forms platform, web App development, high-end printing through Adobe PostScript and Adobe PDF standards and our Adobe Advertising offerings.

Effective in the first quarter of fiscal 2026, we will combine our prior segments—Digital Media, Digital Experience and Publishing and Advertising—into a single operating and reportable segment due to changes in how management intends to evaluate results, allocate resources and execute the strategic opportunities outlined above. Accordingly, we will reflect this segment change in our Quarterly Report on Form 10-Q for the first quarter of fiscal 2026.

OPERATIONS

Marketing and Sales

We market our ~~products, services and~~ solutions directly to enterprise customers through our sales force and local field offices and directly to businesses and consumers. We license our products to end-user customers through ~~App~~app stores and our own website at adobe.com. We offer many of our products via a SaaS model or a managed services model (both of which are referred to as hosted or cloud-based) as well as through term subscription and pay-per-use models. Our ~~subscriptions~~Creative Cloud and ~~free~~Firefly ~~plans~~subscriptions include a monthly plan-specific number of ~~Generative~~generative ~~Credits~~credits for generative AI ~~creation~~tools, ~~with~~and ~~Adobe~~our ~~Firefly~~free plans include a limited number of generative credits. We market and distribute our products through sales channels, which include distributors, retailers, software developers, mobile App stores, systems integrators, independent software vendors and value-added resellers, as well as through original equipment manufacturers and hardware manufacturers.

Our local field offices include locations in Australia, Belgium, Brazil, Canada, China, Denmark, France, Germany, Hong Kong, India, Ireland, Italy, Japan, Mexico, the Netherlands, Poland, Romania, Kingdom of Saudi Arabia, Singapore, South Africa, Republic of Korea, Spain, Sweden, Switzerland, Taiwan, Thailand, the United Kingdom and the United States.10

We sell most of our products through a software subscription model where our customers purchase access to a product for a specific period during which they always have rights to use the most recent version of that product. We also license perpetual versions of certain products with maintenance and support, which includes rights to upgrades, when and if available, support, updates and enhancements.

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retailers, software developers, mobile app stores, systems integrators, independent software vendors and value-added resellers, as well as through original equipment manufacturers and hardware manufacturers.

Our local field offices include locations in Australia, Belgium, Brazil, Canada, China, Denmark, France, Germany, Hong Kong, India, Ireland, Italy, Japan, Mexico, the Netherlands, New Zealand, Poland, Romania, Kingdom of Saudi Arabia, Singapore, South Africa, Republic of Korea, Spain, Sweden, Switzerland, Taiwan, Thailand, the United Kingdom and the United States.

We license our software-as-a-service solutions to customers over multi-year service terms and license the majority of our software products through a subscription model where our customers purchase access to a product for a specific period during which they always have a license to use the most recent version of that product. We also license perpetual versions of certain products with maintenance and support, which includes rights to upgrades, when and if available, support, updates and enhancements.

Services and Support

We provide expert consulting, customer success management, technical support and learning services across ~~all~~a ~~our~~range ~~customer~~of ~~segments, which include enterprises, small and medium businesses, creative professionals and consumers~~audiences. With a focus on ensuring sustained customer success and realized value, this comprehensive portfolio of services is designed to help our customers and partners maximize the return on their investments in our cloud solutions and licensed products.

Consulting Services

We have a global professional services team dedicated to designing and implementing solutions for our largest customers. Our professional services team uses a comprehensive, customer-focused methodology that has been refined over years of capturing and analyzing best practices from numerous customer engagements across a diverse mix of solutions, industries and customer segments. Our customers continually seek to integrate across Adobe’s products and cloud solutions and engage our professional services teams for their expertise in leading our customers’ digital strategies, multi-solution integrations and in running our customers’ platforms. Using our methodology, our professional services teams can accelerate our customers’ time to value and maximize their return on investment in Adobe solutions.

Another key component of Adobe’s strategy is developing a large partner ecosystem to expand the availability of Adobe solutions in the global marketplace. To assist partners in building their respective digital practices, Adobe Global Services provides a comprehensive set of deliverables through Adobe’s Solution Partner Program. The breadth of services offered in the program provides systems integrators, agencies and regional partners the tools required to develop core capabilities for positioning and building with Adobe technology, as well as implementing and running our customers’ platforms. We believe that through these programmatic services and support, our joint customers benefit greatly from the combination of Adobe technology and the deep customer context that our partners represent.

Consulting services are made available to customers through subscription offerings, providing our customers with ongoing access to our trained service professionals over the contract term for the consulting subscription offering, or on a project basis through either time-and-materials or fixed-price services offerings.

Customer Success Account Management

Adobe Customer Solutions provides Customer Success Managers, who work with our enterprise and commercial customers on an ongoing basis to understand their current and future business needs, promote faster solution adoption and align product capabilities to our customers’ business objectives to maximize the return on their investment in Adobe’s offerings. We share innovative best practices, relevant industry and vertical knowledge and proven success strategies based on our extensive engagements with leading marketers and brands. The performance of these teams is directly associated with our customer-focused outcomes.

Technical Support

Adobe provides enterprise maintenance and support services to our subscription customers as part of the subscription entitlement and to our perpetual license customers via annual fee-based maintenance and support programs. These offerings provide our customers with:

•technical support on the products our customers have purchased from Adobe;

•“how to” help in using our products; and

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•product upgrades and enhancements during the term of the maintenance and support or subscription period, which is typically one to three years.

We provide product support through our support organization that includes several regional and global support centers, supplemented with outsourced vendors for specific services. Our customers can seek help through multiple channels including phone, chat, web, social media and email, allowing quick and easy access to the information they need. These teams are responsible for providing timely, high-quality technical expertise on all our products.

Certain consumers are eligible to receive Getting Started support, to assist with easy adoption of their products. Support for some products and in some countries may vary. For our enterprise customers with greater support needs, we offer personalized service options through premium support offerings, delivered by global support centers and technical account managers who can also provide proactive risk mitigation services and on-site support services for those with business-critical deployments.

We also offer delivery assurance, technical support and enablement services to partners and developer organizations. We provide developers with high-quality tools, software development kits, information and services.

17Digital Learning Solutions

~~Table~~Adobe Customer Solutions offers a comprehensive portfolio of ~~Contents~~learning and enablement services to assist our customer and partner teams in the use of our products. Our training portfolio includes a large number of free online self-service learning options on learning.adobe.com. Adobe Digital Learning Solutions also has an extensive portfolio of fee-based learning programs including a wide range of traditional classroom, virtual and on-demand training and certifications delivered by our team of training professionals and partners across the globe.

Digital Learning Services

Adobe Customer Solutions offers a comprehensive portfolio of learning and enablement services to assist our customer and partner teams in the use of our products, including those within Digital Experience, Digital Media and other legacy products, services and solutions. Our training portfolio includes a large number of free online self-service learning options on learning.adobe.com. Adobe Digital Learning Services also has an extensive portfolio of fee-based learning programs including a wide range of traditional classroom, virtual and on-demand training and certifications delivered by our team of training professionals and partners across the globe.

These core offerings are complemented by our custom learning services, which support our largest enterprise customers and their unique requirements. Solution-specific skills assessments help our enterprise customers objectively assess the knowledge and competencies within their marketing teams and tailor their learning priorities accordingly.

Investments

From time to time, we make direct investments in privately held companies. We enter these investments with the intent of securing financial returns as well as for strategic purposes, as they often increase our knowledge of technological developments in the industry and expand our opportunities to provide Adobe products, services, and solutions.

RESEARCH & DEVELOPMENT

~~With~~We ~~the~~have ~~speed~~made, ~~of innovation~~ and ~~technological~~will ~~change~~continue ~~that~~to ~~characterizes the software industry~~make, asignificant ~~continuous~~investments ~~high~~in ~~level~~research ofand ~~investment~~development isto ~~required~~advance ~~for~~ the ~~research~~value and ~~development~~impact of ~~the~~our ~~cutting-edge~~solutions, ~~technologies~~and ~~that lead~~ to ~~the~~continue ~~development~~integrating ofgenerative ~~new products, services~~ and ~~solutions~~agentic ~~and~~technologies ~~the~~across ~~continual~~our ~~enhancement~~tools ofto ~~existing~~solve ~~products,~~problems ~~services~~in ~~and~~areas ~~solutions.~~such ~~Our~~as ~~Adobe~~content ~~Research~~understanding ~~team~~and ~~of research scientists~~generation, ~~engineers~~recommendations, ~~artists~~personalization and ~~designers~~more. ~~help~~In ~~turn~~collaboration ~~ideas~~with ~~into~~universities ~~technologies~~around ~~that~~the ~~power~~world, the ~~future~~Adobe Research team of ~~our~~scientists, ~~products~~engineers, ~~services~~artists and ~~solutions.~~designers We are ~~investing,~~inventing ~~and~~the ~~intend~~future toof ~~continue to invest~~creativity, inproductivity ~~research~~ and ~~development~~customer toexperiences. ~~strengthen~~The ~~our~~Adobe ~~existing~~Research ~~products,~~team ~~services~~advances ~~and~~the ~~solutions,~~state ~~and~~of tothe ~~expand~~art ~~our offerings~~ across ~~our~~12 ~~clouds~~research ~~and~~areas ~~the~~spanning ~~next generation of~~ AI, ~~machine learning~~ and ~~deep~~machine learning~~-driven~~, ~~tools~~content and ~~features~~data tointelligence, ~~solve~~augmented ~~problems~~reality in(AR), ~~areas~~virtual ~~such~~reality ~~as content understanding and generation~~(VR), ~~recommendations,~~3D ~~personalization~~ and ~~more~~audio.

In addition to our own research and development, we acquire products or technology developed by others by purchasing the stock or assets of the business entity that owns the technology. In other instances, we have licensed or purchased the intellectual property ownership rights of programs developed by others with license or technology transfer agreements that may obligate us to pay a flat license fee or royalties, typically based on a dollar amount per unit or a percentage of the revenue generated by those programs.

PROTECTING AND LICENSING OUR ~~PRODUCTS~~SOLUTIONS

We protect our intellectual property through a combination of patents, copyrights, trademarks and trade secrets, foreign intellectual property laws, confidentiality procedures and contractual provisions. We have U.S. and international patents and pending applications that relate to various aspects of our products and technology. ~~Although our patents have value, no single patent is essential to any of our principal businesses.~~ We have ~~also~~ registered, and applied for the registration of, U.S. and international trademarks, service marks, domain names and copyrights. See the section titled “Risk Factors” contained in Part I, Item 1A of this report for additional information regarding risks related to our intellectual property.

We license our desktop software, web offerings and mobile ~~Apps~~apps to users and customers under ‘click through’ or signed license agreements containing restrictions on duplication, disclosure and transfer. Similarly, ~~cloud~~our ~~products~~solutions ~~and services~~ are provided to users and customers under ‘click through’ or signed agreements containing restrictions on access and use. Our enterprise customers license our hosted offerings as SaaS or Managed Services via agreements based on our enterprise licensing terms.

Despite our efforts to protect our proprietary technology and our intellectual property rights, unauthorized parties may attempt to copy or obtain and use our technology to develop Apps with the same functionality as our Apps. Policing unauthorized use of our technology and intellectual property rights is difficult. We believe that our subscription-based business model combined with the increased focus on cloud-based computing has and may continue to improve our efforts to combat the pirating of our products.12

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ACQUISITIONS AND INVESTMENTS

We evaluate acquisition opportunities to accelerate our strategy, further drive innovation and increase the value we offer to customers. Our acquisitions, which range in size and scope, allow us to accelerate product development, introduce new features and deliver new solutions to our customers.

Through our corporate venture capital program, Adobe Ventures, we invest in companies that are shaping the future of creativity, productivity, marketing and AI. We make strategic investments as opportunities arise that complement Adobe’s long-term vision and strategy.

GOVERNMENT REGULATION

We operate globally and are subject to a wide range of laws and regulations in the U.S. and other countries where we operate, covering a wide variety of subject matters, including, but not limited to, those related to antitrust and competition, consumer protection, data privacy and security, and AI. See the section titled “Risk Factors” contained in Part I, Item 1A of this report for additional information regarding risks related to government regulations applicable to our business.

HUMAN CAPITAL

~~Our~~Adobe ~~culture~~for All is ~~built~~our onbelief ~~the~~in ~~foundation~~creating a company culture where all employees are empowered to make an impact. Our founding principle is that ~~our~~great ideas come from anywhere and when people are respected and ~~the~~included, ~~way~~they weare ~~treat~~more ~~one~~creative, ~~another~~innovative ~~promote~~and ~~creativity~~successful. The wealth of unique perspectives and experiences that our employees bring is vital to our business growth, fueling the product innovation and ~~performance,~~value ~~which~~that ~~spur~~we ~~our~~deliver ~~success~~to billions of people around the world. We are continually investing in our global workforce to provide fair and market-competitive pay and benefits to support our employees’ wellbeing, and foster their growth and development~~, and to further drive diversity and inclusion~~. As of November 2928, ~~2024~~2025, we employed 3031,~~709~~360 people, of which 50% were in the United States and 50% were in our international locations. During fiscal ~~2024~~2025, our total attrition rate was 79.89%. We have not experienced work stoppages and believe our employee relations are good. Understanding employee sentiment and listening to employee feedback is important to Adobe. We utilize a variety of feedback mechanisms throughout an employee lifecycle to gather insights that help inform our decision-making regarding employee programs, talent risks, management opportunities, employee networks and more. In fiscal ~~2024~~2025, 8178% of our employees participated in our most recent engagement survey.

Digital transformation has fundamentally changed how people work, and we continue to lean into digital-first workflows, tools and resources to enable us to be productive, wherever we are. We also believe in the value of people being together—fostering trust, relationships and collaboration and innovation. We have evolved into a hybrid model, in which employees who are assigned to an office can divide their work between the office and home about half the time. We continue to pilot, test and iterate our approach to support new ways of working and evolving the employee experience.

We encourage you to visit our website for more detailed information regarding our Human Capital programs and initiatives.

Compensation, Benefits and Wellbeing

Adobe offers fair, competitive compensation and benefits that support our employees’ overall wellbeing. To ensure alignment with our short- and long-term objectives, our compensation programs for all employees include base pay, short-term incentives and opportunities for long-term incentives. We believe this alignment, whether through equity awards issued by Adobe or participation in our employee stock purchase plan, makes employee shareholders more deeply connected to Adobe and engaged in contributing to our long-term success.

Our benefit programs focus on four key wellbeing pillars: physical, emotional, financial and work and life. We offer a wide array of benefits including comprehensive health and welfare insurance, ergonomic support, employee assistance programs, wellbeing support programs, retirement, financial coaches and generous time-off and leave. In addition, we provide educational tools and resources, such as the global wellbeing speaker series, to help employees reach their personal wellbeing goals. We also strive to build community by bringing together our employees through onsite events, discussion groups, messaging forums and our Employee Networks as we believe that a sense of belonging contributes to our employees’ overall wellbeing.

Growth and Development

We provide employees with opportunities to build and develop a meaningful career. The Global Talent Development team creates programs to grow leaders and continually enhance the skills of our employee base. In addition to the content and experiences created in house, employees also have access to on-demand content via several ~~industry-leading~~ learning platforms. Through Adobe’s Learning Fund, employees are eligible to receive up to $11,000 per year toward university and short-term learning opportunities.

We are committed to enabling a culture that celebrates talent sharing, career development and agility across Adobe. We post all roles internally first before sharing them externally and provide resources to make the internal job search easier for employees. We also provide forums for managers and employees to have regular conversations about their career and contributions throughout the year. 13

Diversity and Inclusion

Adobe for All is our vision to advance diversity, equity and inclusion across Adobe. We recognize that when people feel respected and included, they can be more creative, innovative and successful. As of November 29, 2024, women represented 35.4% of our global employees, and underrepresented minorities (“URMs,” defined as those who identify as Black/African American, Hispanic/Latinx, Native American, Pacific Islander and/or two or more races) represented 11.6% of our U.S. employees.

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We ~~have~~are committed to enabling a ~~three-pillar~~culture ~~strategy~~that celebrates talent sharing, career development and agility across Adobe. We post all roles internally first before sharing them externally and provide resources to ~~grow~~make the ~~diversity~~internal ~~and~~job ~~inclusion~~search ofeasier ~~our~~for ~~workforce~~employees. ~~over~~We ~~time,~~also onprovide ~~which~~forums wefor ~~have~~managers ~~continued~~and employees to ~~drive~~have ~~progress~~regular ~~during~~conversations ~~fiscal~~about ~~2024:~~their career and contributions throughout the year.

•Workforce: We take action to improve the hiring, retention and promotion of a more diverse workforce that reflects Adobe’s global footprint. We invest in partnerships and events to grow our pipeline and engage candidates across underrepresented communities. We aim to give individuals from nontraditional backgrounds new skills and opportunities to enter technology and design careers through Adobe Digital Academy, in partnership with our educational partners.

•Workplace: We believe a sense of inclusion propels high performance resulting in creativity and innovation for Adobe. Consequently, we advance our vision of Adobe for All by building an inclusive environment that inspires a sense of belonging. Our annual Adobe for All event provides a unifying experience for employees to celebrate progress, be inspired by employee and guest speakers’ stories, and have a greater appreciation for how diversity, equity and inclusion positively impacts our people, purpose, and product efforts. We offer family-friendly benefits, support our employee resource groups to create community for employees from underrepresented groups and offer employees learning opportunities to strengthen their allyship.

•Ecosystem: Our employees, our customers and the communities we serve care deeply about diversity, equity, and inclusion. As result, we actively align our commitments to our products, partnerships and community engagement to amplify our reach and impact. We collaborate with industry peers to advance diversity across multiple dimensions, including through product equity and accessibility, as well as efforts to address harm and bias in our products. Through the Adobe Foundation, we continue to invest in our Equity and Advancement Initiative and in our partnerships with minority-serving institutions to support their students and faculties and the communities they serve.

Additional information on our diversity and inclusion programs can be found on our website at adobe.com/corporate-responsibility.

AVAILABLE INFORMATION

Our website address is adobe.com. Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, are available free of charge on our Investor Relations website at ~~www.~~adobe.com/adbe as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. The information posted to our website and contents of the websites referred to above are not incorporated into this Annual Report on Form 10-K.

Investors and others should note that we announce material financial information to our investors using our investor relations website (~~www.~~adobe.com/adbe), SEC filings, press releases, and public conference calls and webcasts. We use these channels, including our website and social media, to communicate with our investors and the general public ~~about us, our products, services~~ and ~~solutions and other issues, and~~ to comply with our disclosure obligations under Regulation FD. It is possible that the information ~~that~~ we make available on our website or social media could be deemed to be material information. Therefore, we encourage investors and others interested in Adobe to review the information we make available on our website and the social media channels listed on our website.

INFORMATION ABOUT OUR EXECUTIVE OFFICERS

Adobe’s executive officers as of January 1315, ~~2025~~2026 are as follows:

Name

Age

Positions

Shantanu Narayen

6162

Chair of the Board of Directors and Chief Executive OfficerMr. Narayen currently serves as our Chief Executive Officer and Chair of the Board. He joined Adobe in January 1998 as Vice President and General Manager of our engineering technology group. In January 1999, he was promoted to Senior Vice President, Worldwide Products, and in March 2001, he was promoted to Executive Vice President, Worldwide Product Marketing and Development. In January 2005, Mr. Narayen was promoted to President and Chief Operating Officer, and effective December 2007, he was appointed our Chief Executive Officer and joined our Board. In January 2017, he was named our Chair of the Board. Mr. Narayen currently serves on the board of directors of Pfizer Inc., a pharmaceutical company. Mr. Narayen holds a B.S. in Electronics Engineering from Osmania University in India, an M.S. in Computer Science from Bowling Green State University and an M.B.A. from the Haas School of Business, University of California, Berkeley.

Daniel Durn

Chief Financial Officer and Executive Vice President, Finance, Technology, Security and OperationsMr. Durn currently serves as our Chief Financial Officer and Executive Vice President, Finance, Technology, Security and Operations. Mr. Durn joined Adobe in October 2021 as our Executive Vice President and Chief Financial Officer. From August 2017 to October 2021, Mr. Durn served as a Senior Vice President and Chief Financial Officer of Applied Materials, Inc., a semiconductor equipment company. From December 2015 to August 2017, Mr. Durn served as Executive Vice President and Chief Financial Officer at NXP Semiconductors N.V., following its merger with Freescale Semiconductor Inc. ("Freescale"). From June 2014 to December 2015, Mr. Durn served as Senior Vice President of Finance and Chief Financial Officer at Freescale. Before Freescale, he served as Chief Financial Officer and Executive Vice President of Finance and Administration at GlobalFoundries, a multinational semiconductor company, and he served as Managing Director and Head of Mergers and Acquisitions and Strategy at Mubadala Technology Fund, a private equity fund. Prior to that, Mr. Durn was a Vice President of Mergers and Acquisitions in the technology practice at Goldman Sachs & Company, a global investment banking firm. Mr. Durn currently serves on the board of directors of Marvell Technology, Inc., a semiconductor equipment company. Mr. Durn received his MBA in Finance from Columbia Business School and graduated from the U.S. Naval Academy with a B.S. in Control Systems Engineering. He served in the Navy for six years, reaching the rank of lieutenant.

2014

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Name

Age

Positions

Daniel Durn

Anil Chakravarthy

President, Customer Experience Orchestration BusinessMr. Chakravarthy currently serves as our President, Customer Experience Orchestration Business. From December 2021 to January 2026, Mr. Chakravarthy served as our President, Digital Experience Business. Mr. Chakravarthy joined Adobe in January 2020 as Executive Vice President and General Manager, Digital Experience and was given responsibility over Worldwide Field Operations in July 2020, when he was appointed Executive Vice President and General Manager, Digital Experience Business and Worldwide Field Operations. Prior to joining Adobe, he served as Chief Executive Officer of Informatica LLC ("Informatica"), a software company, from August 2015 to January 2020 and Executive Vice President and Chief Product Officer from September 2013 to August 2015. Prior to joining Informatica, for over nine years, Mr. Chakravarthy held multiple leadership roles at Symantec Corporation ("Symantec"), a cybersecurity software and services company, most recently serving as its Executive Vice President, Information Security from February 2013 to September 2013. Prior to Symantec, he was a Director of Product Management for enterprise security services at VeriSign Inc., a network infrastructure company. Mr. Chakravarthy began his career as an engagement manager at McKinsey & Company, a global management consulting firm. Mr. Chakravarthy holds a Bachelor of Technology in Computer Science and Engineering from the Institute of Technology, Varanasi, India and M.S. and Ph.D. degrees from the Massachusetts Institute of Technology.

Anil Chakravarthy

President, Digital ExperienceMr. Chakravarthy currently serves as President of Adobe’s Digital Experience business. Mr. Chakravarthy joined Adobe in January 2020 as Executive Vice President and General Manager, Digital Experience and was given responsibility over Worldwide Field Operations in July 2020, when he was appointed Executive Vice President and General Manager, Digital Experience Business and Worldwide Field Operations. Prior to joining Adobe, he served as Chief Executive Officer of Informatica LLC ("Informatica"), a software company, from August 2015 to January 2020 and Executive Vice President and Chief Product Officer from September 2013 to August 2015. Prior to joining Informatica, for over nine years, Mr. Chakravarthy held multiple leadership roles at Symantec Corporation ("Symantec"), a cybersecurity software and services company, most recently serving as its Executive Vice President, Information Security from February 2013 to September 2013. Prior to Symantec, he was a Director of Product Management for enterprise security services at VeriSign Inc., a network infrastructure company. Mr. Chakravarthy began his career as an engagement manager at McKinsey & Company, a global management consulting firm. He currently serves on the board of Ansys, Inc. and also served on the board of the Silicon Valley Leadership Group until December 2021. Mr. Chakravarthy holds a Bachelor of Technology in Computer Science and Engineering from the Institute of Technology, Varanasi, India and M.S. and Ph.D. degrees from the Massachusetts Institute of Technology.

David Wadhwani

President, Creativity and Productivity BusinessMr. Wadhwani currently serves as our President, Creativity and Productivity Business. From December 2021 to January 2026, Mr. Wadhwani served as our President, Digital Media Business. Mr. Wadhwani rejoined Adobe in June 2021 to lead Adobe’s global Digital Media business across Adobe Creative Cloud and Adobe Document Cloud as Chief Business Officer and Executive Vice President, Digital Media. Prior to joining Adobe, he was a Venture Partner at Greylock Partners, a venture capital firm, since October 2019. From September 2015 to October 2019, he was President and CEO of AppDynamics, a software company. Before that, Mr. Wadhwani previously worked at Adobe as Senior Vice President and General Manager of Adobe’s Digital Media business, having joined Adobe in 2005 through the Company’s acquisition of Macromedia, Inc., a software company, where he had been Vice President of Developer Products. Mr. Wadhwani holds a bachelor’s degree in computer science from Brown University and serves on the Brown computer science department advisory board. Mr. Wadhwani also advises early stage and growth companies and is on the board of directors of Gem Software, Inc., an AI recruiting software company, and on the board of trustees of StoryCorps and the Fine Arts Museums of San Francisco.

David Wadhwani

President, Digital MediaMr. Wadhwani currently serves as President of Adobe’s Digital Media business. Mr. Wadhwani rejoined Adobe in June 2021 to lead Adobe’s global Digital Media business across Adobe Creative Cloud and Adobe Document Cloud as Chief Business Officer and Executive Vice President, Digital Media. Prior to joining Adobe, he was a Venture Partner at Greylock Partners, a venture capital firm, since October 2019. From September 2015 to October 2019, he was President and CEO of AppDynamics, a software company. Before that, Mr. Wadhwani previously worked at Adobe as Senior Vice President and General Manager of Adobe’s Digital Media business, having joined Adobe in 2005 through the Company’s acquisition of Macromedia, Inc., a software company, where he had been Vice President of Developer Products. Mr. Wadhwani holds a bachelor’s degree in computer science from Brown University and serves on the Brown computer science department advisory board. Mr. Wadhwani also advises early stage and growth companies and is on the board of directors of Gem Software, Inc. and on the board of trustees of StoryCorps and the Fine Arts Museums of San Francisco.

Lara Balazs

Chief Marketing Officer and Executive Vice President, Global MarketingMs. Balazs joined Adobe in December 2024 and currently serves as our Chief Marketing Officer and Executive Vice President, Global Marketing. From February 2021 to September 2024, Ms. Balazs served as Executive Vice President, General Manager, Strategic Partnership Group and Chief Marketing Officer of Intuit, Inc., a global financial technology platform (“Intuit”). From November 2018 to February 2021, Ms. Balazs served as Senior Vice President, Chief Marketing Officer of Intuit. From November 2017 to July 2018, Ms. Balazs served as Vice President, Worldwide Marketing, Prime, and North America, of Amazon.com, Inc., an online retailer and web service provider of consumer goods. From January 2006 to September 2017, Ms. Balazs held various leadership roles at Visa, Inc., a global payments technology company, including Senior Vice President, Head, North America Marketing; Head, Global Innovation Marketing; Head of Global Product Marketing Strategy and Planning; Head of Global and U.S. General Consumer Marketing; and Senior Director, U.S. Marketing. From 2001 to 2004, Ms. Balazs served in various marketing management roles at Nike, Inc., a global athletic footwear and apparel company, and Gap, Inc., a global apparel company. Ms. Balazs holds a bachelor’s degree in Society & Justice from the University of Washington, and an M.B.A. from Northwestern University.

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Name

Age

Positions

Lara Balazs

Chief Marketing Officer and Executive Vice President, Global MarketingMs. Balazs joined Adobe in December 2024 and currently serves as our Chief Marketing Officer and Executive Vice President, Global Marketing. From February 2021 to September 2024, Ms. Balazs served as Executive Vice President, General Manager, Strategic Partnership Group and Chief Marketing Officer of Intuit, Inc., a global financial technology platform (“Intuit”). From November 2018 to February 2021, Ms. Balazs served as Senior Vice President, Chief Marketing Officer of Intuit. From November 2017 to July 2018, Ms. Balazs served as Vice President, Worldwide Marketing, Prime, and North America, of Amazon.com, Inc., an online retailer and web service provider of consumer goods. From January 2006 to September 2017, Ms. Balazs held various leadership roles at Visa, Inc., a global payments technology company, including Senior Vice President, Head, North America Marketing; Head, Global Innovation Marketing; Head of Global Product Marketing Strategy and Planning; Head of Global and U.S. General Consumer Marketing; and Senior Director, U.S. Marketing. From 2001 to 2004, Ms. Balazs served in various marketing management roles at Nike, Inc., a global athletic footwear and apparel company, and Gap, Inc., a global apparel company. Ms. Balazs currently serves on the board of directors of Frontdoor, Inc., a home services company. Ms. Balazs holds a bachelor’s degree in Society & Justice from the University of Washington, and an M.B.A. from Northwestern University.

Gloria Chen

Chief People Officer and Executive Vice President, Employee ExperienceMs. Chen joined Adobe in 1997 and currently serves as our Chief People Officer and Executive Vice President, Employee Experience. In her more than 25 years at Adobe, she has held senior leadership positions in worldwide sales operations, customer service and support, and strategic planning. In October 2009, Ms. Chen was appointed Vice President and Chief of Staff to the Chief Executive Officer. In March 2018, she was promoted to Senior Vice President, Strategy and Growth, in November 2019, she was elevated to Executive Vice President, Strategy and Growth and in January 2020, she was promoted to Chief People Officer and Executive Vice President, Employee Experience. From October 2024 to May 2025, Ms. Chen served as our Chief People Officer and Interim Executive Vice President, Legal and Government Relations. Prior to joining Adobe, Ms. Chen was an engagement manager at McKinsey & Company, a global management consulting firm. Ms. Chen holds a BS in electrical engineering from the University of Washington, an M.S. in electrical and computer engineering from Carnegie Mellon University and an MBA from Harvard Business School.

Scott Belsky

Chief Strategy Officer and Executive Vice President, Design & Emerging ProductsMr. Belsky currently serves our Chief Strategy Officer and EVP, Design & Emerging Products. From December 2017 to March 2023, he served as our Chief Product Officer and Executive Vice President, Creative Cloud. Prior to joining Adobe in December 2017, Mr. Belsky was a venture investor at Benchmark, a venture capital firm, from February 2016 to December 2017. Prior to Benchmark, Mr. Belsky led Adobe's mobile strategy for Creative Cloud from December 2012 to January 2016, having joined the Company through the acquisition of Behance, a social media platform for creative work. Mr. Belsky co-founded Behance in 2006 and served as its Chief Executive Officer for over 6 years. He was an early advisor and investor to Pinterest, Inc., a software company, Uber Technologies, Inc., a multinational ride-sharing company, and Warby Parker Inc., an online retailer, and other early-stage companies. Mr. Belsky currently serves on the board of directors of Atlassian Corporation, an enterprise software company, on the advisory board of Cornell University's Entrepreneurship Program and on the board of trustees of the Museum of Modern Art. Mr. Belsky holds a bachelor’s degree from Cornell University and an MBA from Harvard Business School.

Louise Pentland

Chief Legal Officer and Executive Vice President, Legal and Government RelationsMs. Pentland joined Adobe in May 2025 and currently serves as our Chief Legal Officer and Executive Vice President, Legal and Government Relations. From July 2024 to May 2025, Ms. Pentland served as SVP and General Counsel at Roku, Inc., a manufacturer of media players for streaming entertainment. From September 2023 to July 2024, Ms. Pentland served as EVP and Chief Counsel for Disney Experiences and Products at The Walt Disney Company, a multinational media and entertainment company. From January 2022 to July 2022, Ms. Pentland served as EVP and Senior Advisor to the CEO at PayPal Holdings, Inc., a financial technology company, and as EVP, Chief Business Affairs and Legal Officer from April 2015 to December 2021. From May 1998 to July 2014, Ms. Pentland held various legal positions of increasing responsibility at Nokia Corporation, a communications, information technology and consumer electronics company, including the position of EVP and Chief Legal Officer. Ms. Pentland currently serves on the board of directors of Pacific Life Insurance Company, a financial services company specializing in life insurance. Ms. Pentland holds both an undergraduate degree in law and a postgraduate diploma in legal practice from Northumbria University, Newcastle upon Tyne.

Gloria Chen

Chief People Officer and Interim Executive Vice President, Legal and Government RelationsMs. Chen joined Adobe in 1997 and currently serves as our Chief People Officer and Interim EVP, Legal and Government Relations. From January 2020 to September 2024, Ms. Chen served as our Chief People Officer and Executive Vice President, Employee Experience. In her more than 25 years at Adobe, she has held senior leadership positions in worldwide sales operations, customer service and support, and strategic planning. In October 2009, Ms. Chen was appointed Vice President and Chief of Staff to the Chief Executive Officer. In March 2018, she was promoted to Senior Vice President, Strategy and Growth, in November 2019, she was elevated to Executive Vice President, Strategy and Growth and in January 2020, she was promoted to Chief People Officer and Executive Vice President, Employee Experience. Prior to joining Adobe, Ms. Chen was an engagement manager at McKinsey & Company, a global management consulting firm. Ms. Chen holds a BS in electrical engineering from the University of Washington, an M.S. in electrical and computer engineering from Carnegie Mellon University and an MBA from Harvard Business School.

Jillian Forusz

Senior Vice President, Chief Accounting Officer and Corporate ControllerMs. Forusz currently serves as our Senior Vice President, Chief Accounting Officer and Corporate Controller. Ms. Forusz served as our Vice President, Corporate Controller from February 2022 to August 2024, Vice President, Accounting & Operations from November 2019 to February 2022 and Senior Director from November 2015 to November 2019. Between November 2007 and November 2015, Ms. Forusz held various finance leadership positions of increasing responsibility at Adobe. Prior to joining Adobe, Ms. Forusz worked in the Audit practice at Deloitte. Ms. Forusz holds a bachelor’s degree from Penn State University.

Jillian Forusz

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ITEM 1A. RISK FACTORS

As previously discussed, our actual results could differ materially from our forward-looking statements. Below we discuss some of the factors that could cause these differences. The occurrence of these and many other factors described in this report, and factors that we do not presently know or that we currently believe to be immaterial, could materially and adversely affect our operations, performance and financial condition. Many factors affect more than one category and the factors are not in order of significance or probability of occurrence because they have been grouped by categories.

Risks Related to Our Ability to Grow Our Business

We may be unsuccessful at innovating in response to rapid technological or industry changes to meet customer needs, which could cause our ~~operating~~business and financial results to suffer materially.

We operate in rapidly evolving industries and expect the pace of innovation to continue to accelerate. We must continually introduce new, and enhance existing, ~~products, services and~~ solutions to retain customers and attract new customers. Developing new ~~products, services and~~ solutions is complex, requires significant investment and operational costs and may not be profitable, and our investments in new technologies are speculative and may not yield the expected business or financial benefits. The commercial success of new or enhanced ~~products, services and~~ solutions depends on a number of factors, including timely and successful development; effective distribution and marketing; market acceptance; compatibility with existing and emerging standards, platforms, software delivery methods and technologies; accurately predicting and anticipating customer needs and expectations and the direction of technological change; identifying and innovating in the right technologies; and differentiation from other ~~products, services and~~ solutions. If we fail to anticipate or identify technological, creative, productivity or marketing trends or fail to devote appropriate resources to adapt to such trends, our business could be harmed. For example, ~~generative~~ artificial intelligence ~~technologies~~(“AI”), ~~enable~~including generative and agentic, enables users of all skill levels to create and provide new ways of marketing, creating and editing content and interacting with documents,. ~~which~~While ~~could significantly disrupt industries in which~~ we ~~operate~~continue ~~and~~to ~~our~~release ~~existing~~new ~~products,~~AI ~~services and~~ solutions and ~~our business may be harmed if we fail~~ to ~~invest~~focus ~~or adapt. While we have released new generative artificial intelligence products, such as Adobe Firefly, and are focused~~ on enhancing the ~~artificial intelligence (“~~AI”) capabilities of our ~~products~~solutions and incorporating AI across existing ~~products, services and~~ solutions, there can be no assurance that our new or enhanced ~~products~~solutions and AI innovations will be successful, adopted or monetizable or that we will innovate effectively to keep pace with the rapid evolution of AI across our ~~offerings~~solutions. If we do not successfully innovate, adapt to rapid technological or industry changes and meet customer needs, our business and our financial results may be materially harmed.

~~Issues~~We ~~relating~~participate toin ~~the~~rapidly ~~development~~evolving and ~~use~~intensely ofcompetitive AImarkets, ~~including generative AI~~and, inif ~~our~~we ~~offerings~~do ~~may~~not ~~result~~compete ~~in reputational harm~~effectively, ~~liability~~our business and ~~adverse~~ financial results could materially suffer.

~~Social,~~The ~~ethical~~markets for our solutions are rapidly evolving and ~~operational~~intensely ~~issues~~competitive. ~~relating~~We expect competition to ~~the~~continue ~~use~~to intensify. Our numerous competitors include companies of AIvarious sizes and both public and private companies, including ~~generative~~large, global companies and smaller companies with more specialized focuses, new entrants, and AI or cloud-native companies. Our competitors include companies with significant sales and research and development resources, inbroad ~~our~~brand ~~offerings~~awareness, ~~may~~long ~~result~~operating inhistories ~~reputational~~or ~~harm~~access to large customer bases. Our competitors may deploy technical, ~~liability~~marketing and ~~additional~~financial ~~costs~~resources more easily and effectively. WeOur competitors may develop or acquire additional products, services or solutions that are ~~increasingly~~similar ~~incorporating~~to AIours ~~technologies~~or that achieve greater or faster acceptance. Our competitors may undertake faster and more far-reaching and successful development efforts or marketing campaigns, ~~developed~~may byadopt usmore aggressive pricing policies or may more effectively appeal to customers. As a result, current and bypotential ~~third~~customers ~~parties~~may select the products, ~~into~~services ~~many~~or solutions of our ~~offerings~~competitors. IfNew ~~our~~industry AIstandards, ~~development~~evolving distribution and sales models, ~~deployment~~limited barriers to entry, ~~content~~short ~~labeling~~product orlife ~~governance~~cycles, iscustomer ~~ineffective~~price sensitivity, global economic conditions and the frequent entry of new solutions or ~~inadequate~~competitors may increase downward pressure on pricing and gross margins and adversely affect our renewal, itupsell ~~may~~and ~~result~~cross-sell rates as well as our ability to attract new customers. In addition, we expect to face more competition as AI continues to advance and be integrated into the markets in ~~incidents~~which ~~that~~we ~~impair~~compete and to change the ~~public~~software ~~acceptance~~industry. ofOur competitors or other third parties may develop AI solutions more rapidly or ~~cause~~successfully, ~~harm~~including but not limited to ~~individuals,~~different ~~customers~~data training strategies or ~~society~~proprietary access to data and, oras a result, other AI solutions may achieve greater and faster adoption. For example, we face increasing competition from companies offering generative and agentic AI solutions, including but not limited to prompt-based and multi-modal creation and editing, document productivity and understanding, ad distribution and creation, and purpose-built AI agents. Other companies have in the past, and may in the future prevent, limit or interfere with our ~~offerings~~ability to use third-party models in our solutions. If we are not ~~working~~able asto ~~intended~~provide orsolutions ~~producing~~that ~~unexpected~~compete ~~outcomes~~effectively, we could experience reduced sales, which could materially and adversely impact our business and financial results. For additional information regarding our competition and the risks arising out of the competitive environment in which we operate, see the section titled “Competition” contained in Part I, Item 1 of this report.

Jurisdictions around the world are developing and passing new regulations that apply specifically to the use of AI. For example, the EU AI Act was adopted in 2024 and will be implemented in phases through 2030, and other jurisdictions are considering similarly focused legislation. These regulations and the evolving AI regulatory environment may, among other impacts, result in inconsistencies among AI regulations and frameworks across jurisdictions, increase our compliance, governance and research and development costs, increase our exposure to claims related to our AI models and increase liability related to the use of AI by our customers or users that are beyond our control. While we have taken a responsible approach to the development and use of AI, such as in our Adobe Firefly offerings, there can be no guarantee that future AI regulations will not adversely impact us or conflict with our approach to AI, including affecting our ability to make our AI offerings available without costly changes, delaying or halting development of AI offerings, requiring us to change our AI development practices, monetization strategies and/or indemnity protections and subjecting us to additional compliance requirements, regulatory action, competitive harm, reputational harm and/or legal liability. To the extent we rely on third-party AI models in our products, services and solutions, we will face risks inherent in how those models have been developed and deployed, including situations in which the third party may lack a proper license or consent for the training data used for their model. In addition, new competition regulations on AI development and deployment could impose new requirements on our markets that could impact our business and financial results.17

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~~involved~~Issues inrelating ~~such systems. These costs could adversely impact our margins as we continue~~ to ~~make~~the ~~significant investments in AI~~ development, ~~add AI capabilities to our offerings~~ and ~~scale~~use ~~our~~of AI ~~offerings~~in ~~without assurance that~~ our ~~customers~~solutions ~~and~~may ~~users~~result ~~will~~in ~~adopt~~reputational ~~them. Further~~harm, asliability ~~with any new offerings based on new technologies, consumer reception~~ and ~~monetization~~adverse ~~pathways are uncertain, our strategies may not be successful and our~~ business and financial results ~~could be adversely impacted~~. New AI offerings and technologies could modify workforce needs, result in negative publicity about AI and decrease demand for our existing products, services and solutions, all of which could adversely impact our business.

WeSocial, ~~participate~~ethical and operational issues relating to the use of AI, including generative AI and agentic AI, in ~~rapidly~~our ~~evolving~~solutions may result in reputational harm, liability and ~~intensely~~additional ~~competitive~~costs. ~~markets~~We are increasingly incorporating AI technologies, developed by us and by third parties, ifinto wemany doof ~~not~~our ~~compete~~solutions. ~~effectively~~If our AI development, deployment, content labeling or governance is ineffective or inadequate, it may result in incidents that impair the public acceptance of AI solutions or cause harm to individuals, customers or society, or result in our ~~operating~~solutions ~~results~~not ~~could~~working ~~suffer~~as intended or producing unexpected outcomes.

~~The~~Jurisdictions ~~markets~~around ~~for~~the ~~our~~world ~~products,~~are ~~services~~developing and ~~solutions~~passing ~~are~~new ~~rapidly~~regulations ~~evolving~~that ~~and~~apply ~~intensely~~specifically ~~competitive.~~to Wethe ~~expect~~use ~~competition~~of toAI. ~~continue~~For toexample, ~~intensify~~the U.S. ~~Our~~AI ~~numerous~~regulatory ~~competitors~~framework ~~range~~remains in ~~size~~development ~~from~~and ~~diversified~~has ~~global~~been ~~companies~~introduced ~~with~~at ~~significant~~the ~~sales~~federal ~~and~~level ~~research~~through executive orders and ~~development~~legislation ~~resources,~~has ~~broad~~been ~~brand~~introduced ~~awareness,~~and ~~long~~enacted ~~operating~~at ~~histories~~the orstate ~~access~~level. toAdditionally, ~~large~~obligations ~~customer~~under ~~bases~~the toEU ~~small~~AI ~~companies~~Act ~~whose~~have ~~specialized~~gone ~~focuses~~into ~~may~~effect ~~allow~~and ~~them~~will continue to ~~more~~be ~~easily~~implemented ~~and~~in ~~effectively~~phases ~~deploy~~through ~~technical~~2030, ~~marketing~~ and ~~financial~~other ~~resources.~~jurisdictions ~~Our~~have ~~competitors~~passed ~~may~~or ~~develop~~are orconsidering ~~acquire~~similarly ~~products,~~focused ~~services~~legislation. orSome ~~solutions~~of ~~that~~our operations are ~~similar~~subject to ~~ours~~the orEU ~~that~~AI ~~achieve~~Act ~~greater~~and ordepending ~~faster~~on ~~acceptance,~~how ~~may~~the ~~undertake~~EU ~~more~~AI ~~far-reaching~~Act is implemented and ~~successful~~interpreted, ~~product~~we ~~development~~may ~~efforts~~have orto ~~marketing~~adapt ~~campaigns~~our orbusiness ~~may~~practices, ~~adopt~~contractual ~~more~~arrangements ~~aggressive~~and ~~pricing~~services ~~policies~~to comply with such obligations. AsNon-compliant acompanies ~~result,~~under ~~current~~the ~~and~~EU ~~potential~~AI ~~customers~~Act may ~~select~~be ~~the~~subject ~~products,~~to ~~services~~administrative orfines. ~~solutions~~These ofregulations ~~our~~and ~~competitors.~~the ~~Further,~~evolving ~~our~~AI ~~future~~regulatory ~~success~~environment ~~depends~~may, onamong ~~our~~other ~~continued~~impacts, ~~ability~~result toin ~~effectively~~inconsistencies ~~appeal~~among toAI ~~businesses~~regulations and ~~consumers.~~frameworks ~~New~~across ~~industry standards~~jurisdictions, ~~evolving~~increase ~~distribution~~our ~~models~~compliance, ~~limited~~governance ~~barriers~~and toresearch ~~entry,~~and ~~short~~development ~~product~~costs, ~~life~~increase ~~cycles,~~our ~~customer~~exposure ~~price~~to ~~sensitivity~~investigations, ~~global~~proceedings ~~market~~and ~~conditions~~claims ~~and~~related ~~the~~to ~~frequent~~our ~~entry~~AI ofmodels ~~new~~and ~~products~~increase orliability ~~competitors~~related ~~may~~to ~~increase~~the ~~downward~~use ~~pressure~~of onAI ~~pricing~~by ~~and~~our ~~gross~~customers ~~margins~~or ~~and~~users ~~adversely~~that ~~affect~~are beyond our ~~renewal,~~control. ~~upsell~~There ~~and~~can ~~cross-sell~~be ~~rates~~no asguarantee ~~well~~that asfuture ~~our~~AI ~~ability~~regulations toor ~~attract~~standards ~~new~~will ~~customers.~~not Inadversely ~~addition,~~impact weus ~~expect~~or toconflict ~~face~~with ~~more~~our ~~competition~~approach asto AI ~~continues~~development toand ~~advance~~use, ~~and~~including beaffecting ~~integrated~~our ~~into~~ability ~~the~~to ~~markets~~make inour ~~which~~AI wesolutions ~~compete.~~available ~~Our~~without ~~competitors~~costly orchanges, ~~other~~delaying ~~third~~or ~~parties~~halting ~~may~~development ~~incorporate~~of AI ~~into~~solutions, ~~their~~requiring ~~offerings~~us ~~more~~to ~~successfully~~change ~~and~~our ~~efficiently~~AI ~~than~~development wepractices, domonetization strategies and/or ~~achieve~~indemnity ~~greater~~protections and ~~faster~~subjecting ~~adoption,~~us ~~which~~to ~~could~~additional ~~impair~~compliance ~~our~~requirements, ~~ability~~regulatory toaction, ~~compete~~competitive ~~effectively~~harm, ~~and~~reputational ~~adversely~~harm ~~affect our business~~ and/or ~~financial~~legal ~~results~~liability. ~~Other companies have~~Additionally, oras inwe ~~the~~offer ~~future~~more ~~may~~third-party ~~obtain,~~AI ~~proprietary~~models ~~rights~~in ~~that~~our ~~would prevent~~solutions, ~~limit~~we orface ~~interfere~~risks ~~with~~inherent ~~our~~in ~~ability~~how tothird-party ~~make,~~AI ~~use~~models orused ~~sell~~in our AIsolutions ~~offerings.~~have ~~Further,~~been wedeveloped ~~expect~~and AIdeployed, ~~offerings~~including tosituations bein ~~highly~~which ~~competitive~~the ~~and~~third ~~rapidly~~party ~~evolving.~~may ~~For~~lack ~~example,~~a weproper ~~face~~license ~~increasing~~or ~~competition~~consent ~~from~~for ~~companies~~the ~~offering~~training ~~generative~~data AIused ~~capabilities,~~for ~~including~~their ~~text-to-image,~~model. ~~text-to-video~~The use and ~~multi-modal~~availability ~~offerings~~of ~~that~~third-party ~~compete~~AI ~~directly~~models ~~with~~in our ~~creative~~solutions ~~offerings.~~could Ifresult wein ~~are~~scrutiny ~~not~~and ~~able~~legal toliability, ~~provide~~including ~~products,~~intellectual ~~services~~property ~~and~~infringement ~~solutions~~claims. ~~that~~Such ~~compete~~claims ~~effectively,~~or wescrutiny could ~~experience~~cause ~~reduced~~reputational ~~sales~~harm and ~~our~~loss ~~business~~of ~~could~~customers, beand adversely ~~affected.~~impact ~~For additional information regarding~~ our ~~competition~~business and ~~the~~financial ~~risks~~results. ~~arising~~In ~~out~~addition, ofnew ~~the~~competition ~~competitive~~regulations ~~environment~~on inAI ~~which~~development weand ~~operate,~~deployment ~~see~~could ~~the~~impose ~~section~~new ~~titled~~requirements ~~“Competition”~~on ~~contained~~our inmarkets ~~Part~~that I,could ~~Item~~impact 1our ofbusiness ~~this~~and ~~report~~financial results.

Uncertainty around new and evolving AI uses may require significant, additional investment to develop models and proprietary datasets, responsible-use frameworks and new approaches and processes to attribute or compensate content creators. We have experienced, and may in the future experience, challenges accessing AI models, datasets or hardware. Developing, testing and deploying AI systems and third-party AI models may continue to increase the cost of our solutions, including due to the nature of the computing costs involved in such systems. These costs could adversely impact our margins as we continue to make significant investments in AI development, add AI capabilities and third-party AI models to our solutions and scale our AI solutions without assurance that our customers and users will adopt them. Further, as with any new solutions based on new and rapidly evolving technologies, consumer reception and monetization pathways are uncertain, our strategies may not be successful and our business and financial results could be adversely impacted. AI solutions may continue to modify workforce needs, result in negative publicity, reputational harm, liability and decreased demand for our solutions, all of which could adversely impact our business.

If our reputation or our brands are damaged, our business and financial results may be adversely affected.

We believe our reputation and brands have been, and we expect them to continue to be, important to our business and financial results. Maintaining and enhancing our brands may require us to make substantial investments and these investments may not be successful. We have experienced, and may in the future experience, reputational harm, reduced customer demand and customer attrition from, among other things, the introduction of new products, features, services, or terms that do not meet customer expectations; our position on or approach to new and evolving technologies, including AI; backlash from customers, the creative community, government entities or other stakeholders that disagree with our product offering decisions or public policy, social, ethical or political positions; significant litigation or regulatory or government actions that negatively reflect on our business practices; data security breaches or compliance failures; and public scrutiny or negative publicity, including being the target of media and social media campaigns, criticizing our actual or perceived actions or inactions, policies, terms, agreements, dispute resolution requirements, handling of user privacy, data practices or content. ~~Further,~~Our ~~our~~ brands may be negatively affected by ~~uses~~the ofactual or perceived failure to meet our ~~products,~~sustainability ~~services~~commitments or appropriately respond to climate concerns; and uses of our solutions, particularly our AI ~~offerings~~solutions, in ways that are out of our control, such as to create or disseminate content that is deemed to be misleading, deceptive or intended to manipulate public opinion, or for illicit, objectionable or illegal ends, or by our failure to respond appropriately and in a timely manner to such uses. ~~Such~~Further, such uses of our solutions may result in controversy or claims related to defamation, rights of publicity, illegal content, intellectual property infringement, harmful content, misinformation and disinformation, harmful bias, misappropriation, data privacy, derivative uses of third-party AI and personal injury torts. If we fail to appropriately respond to objectionable content created using our products, services or solutions or shared on our platforms, our users may lose confidence in our brands. Entry into markets with weaker protection of brands or changes in the legal systems in countries in which we operate may also impact our ability to protect our brands. If we fail to maintain, enhance or protect our brands, or if we incur excessive expenses in our efforts to do so, our users’ trust in us and purchasing decisions and our business and financial results may be adversely affected.

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Weharmful content, misinformation and disinformation, harmful bias, misappropriation, data privacy, derivative uses of third-party AI and personal injury torts. If we fail to appropriately respond to objectionable content created using our solutions or shared on our platforms, our users may ~~not~~lose ~~realize~~confidence ~~the~~in ~~anticipated~~our ~~benefits~~brands. Entry into markets with weaker protection of ~~investments~~brands or ~~acquisitions~~changes in the legal systems in countries in which we operate may also impact our ability to protect our brands. If we fail to maintain, enhance or protect our brands, or if we incur excessive expenses in our efforts to do so, our users’ trust in us and ~~they~~purchasing ~~may~~decisions ~~disrupt~~and our business and ~~divert~~financial ~~management’s~~results ~~attention~~may be adversely affected.

~~Investments~~We ~~and~~may ~~acquisitions~~not ~~involve~~realize ~~numerous~~the ~~risks~~anticipated ~~and~~benefits ~~uncertainties~~of acquisitions, ~~the~~investments ~~occurrence~~or ofother ~~which~~strategic ~~may~~transactions, ~~have~~and anthey ~~adverse~~may ~~effect~~disrupt on our business. ~~These~~and ~~risks~~adversely affect our business and ~~uncertainties~~financial ~~include:~~results.

~~•inability~~We have acquired and may continue to ~~achieve~~acquire ~~the~~businesses, ~~financial~~products, talent and ~~strategic~~technologies ~~goals~~as part of our business strategy. Acquisitions, investments and other strategic transactions involve numerous risks and uncertainties, the ~~investment~~occurrence orof ~~acquisition;~~which may have an adverse effect on our business. These risks and uncertainties include:

•~~difficulty~~inability into ~~effectively~~achieve ~~integrating~~ the ~~operations,~~expected ~~technologies,~~financial ~~products,~~and ~~services,~~strategic ~~solutions,~~benefits ~~culture~~on ora ~~personnel~~timely ofbasis ~~the~~or ~~acquired~~at ~~business~~all;

•difficulty in effectively integrating operations, technologies, products, services, solutions, culture or personnel;

•disruption of our ongoing business and distraction of our management and other personnel;

•challenges to completing or failure to complete an announced ~~investment~~transaction ~~or acquisition~~ related to the failure to obtain regulatory approval, or the need to satisfy certain conditions precedent to closing such transaction (such as divestitures, ownership or operational restrictions or other structural or behavioral remedies) that could limit the anticipated benefits of the transaction;

•entry into markets in which we have minimal prior experience and where competitors in such markets have stronger market positions;

•inability to retain personnel, key customers, distributors, vendors and other business partners of the acquired business;

•delay in customer and distributor purchasing decisions due to uncertainty about the direction of our ~~product and service offerings~~solutions;

•incurring higher than anticipated costs to effectively integrate an acquired business, to bring an acquired company into compliance with applicable laws and regulations, additional compensation issued or assumed in connection with an acquisition, to divest products, services or solutions acquired in unsuccessful ~~investments or~~ acquisitions, to amortize costs for acquired intangible assets or because of our inability to take advantage of anticipated tax benefits;

•increased collection times, elevated delinquency or bad debt write-offs related to receivables of an acquired business we assume;

•difficulty in maintaining controls, procedures and policies during the transition and integration of an acquired business and inability to conclude that our internal controls over financial reporting are effective;

•potential identified or unknown security vulnerabilities in acquired or integrated entities’ systems, technologies, or products that expose us to additional security risks or delay our ability to integrate the ~~product~~acquired products into our ~~offerings~~existing solutions;

•exposure to litigation or other claims in connection with, or inheritance of claims or litigation risk as a result of, ana ~~acquisition~~transaction;

•incurrence of additional debt to finance ana ~~acquisition~~transaction, which will increase our interest expense and leverage, and/or issuance of equity securities to finance ~~acquisitions~~transactions, which will dilute current shareholders’ percentage ownership and earnings per share; ~~and~~

•in the case of foreign transactions, the impact of particular economic, tax, currency, political, legal and regulatory risks associated with specific countries;

•brand or reputational harm associated with our acquisitions, investments or other strategic transactions; and

•failure to identify significant problems, liabilities or other challenges during due diligence.

Our ability to acquire other businesses or technologies, make strategic investments or integrate acquired businesses effectively may also be impaired by adverse economic and political events, including trade tensions, and increased global scrutiny and evolving regulatory expectations relating to acquisitions and strategic investments. We may not be able to complete acquisitions or other strategic transactions to realize the anticipated benefits of such acquisitions or transactions on favorable terms, or at all, including as a result of challenges in obtaining regulatory approvals, and may incur additional costs. For example, we have experienced difficulties in obtaining regulatory approvals, resulting in the termination of a previously announced acquisition and the incurrence of additional costs. Any of these factors may adversely affect our financial condition or results of operations.19

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Our ability to acquire other businesses or technologies, make strategic investments or integrate acquired businesses effectively may also be impaired by adverse economic and political events, including trade tensions, and increased global scrutiny and evolving regulatory expectations relating to acquisitions and other strategic transactions. We may not be able to complete acquisitions or other strategic transactions to realize the anticipated benefits of such acquisitions or transactions on favorable terms, or at all, including as a result of challenges in obtaining regulatory approvals, and may incur additional costs. For example, we have experienced difficulties in obtaining regulatory approvals, resulting in the termination of a previously announced acquisition and the incurrence of additional costs. Any of these factors may adversely affect our business and financial results.

Risks Related to the Operation of Our Business

~~Service~~If ~~interruptions~~we orare ~~failures~~unable ofto ~~our~~recruit orand ~~third-party~~retain ~~information~~key ~~technology~~personnel, ~~systems~~our business may ~~impair~~be ~~the~~harmed, ~~availability~~and of our ~~products,~~hybrid ~~services~~work ~~and~~model ~~solutions, which~~ may ~~expose~~present ~~us to liability~~challenges, ~~damage~~which ~~our~~could ~~reputation~~adversely ~~and~~impact ~~harm~~ our ~~future financial results~~business.

Much of our ~~business,~~future ~~including~~success ~~our~~depends ~~online~~on ~~store~~the atcontinued ~~adobe.com and our cloud solutions~~service, ~~relies~~availability ~~on hardware~~ and ~~services~~performance ~~that~~of ~~are~~our ~~hosted,~~senior ~~managed~~management and ~~controlled~~highly ~~directly~~skilled bypersonnel usacross orall ~~third-party~~levels ~~service~~of ~~providers to be available to~~ our ~~customers~~organization. ~~and~~Our ~~users~~senior ~~without~~management ~~disruption.~~has Weacquired dospecialized ~~not~~knowledge ~~have~~and ~~redundancy~~skills ~~for~~with ~~all~~respect to our ~~systems~~business, ~~many~~and ofthe ~~our~~loss ~~critical~~of ~~applications~~any ~~(“Apps”)~~of ~~reside~~these inindividuals ~~only~~could ~~one~~harm of our ~~data centers~~business, ~~and~~especially ~~our~~if ~~disaster~~we ~~recovery~~are ~~planning~~not ~~may~~successful ~~not~~in ~~account~~developing ~~for~~adequate ~~all~~succession ~~eventualities~~plans. IfOur ~~any~~efforts ~~critical~~to ~~third-party~~attract, ~~service~~develop, ~~provider~~integrate ofand ~~hosting~~retain orhighly ~~content~~skilled ~~delivery~~employees ~~services is negatively affected or becomes unavailable to us for any reason, we~~ may ~~not~~ be ~~able~~compounded toby ~~deliver~~intensified ~~the~~restrictions ~~corresponding~~on ~~products,~~immigration ~~services~~ or ~~solutions~~the toavailability ~~our~~of ~~customers~~work ~~and users~~visas. ~~Failure~~The oftechnology ~~our~~industry ~~systems~~has orbeen ~~those of our third-party service providers could cause large, system-wide failures, disrupt our business operations~~ and ~~those~~may ofcontinue ~~our~~to ~~customers,~~be subject us to ~~reputational~~substantial ~~harm,~~and ~~require~~continuous ~~costly~~competition ~~and~~for ~~time-intensive notifications~~talent, ~~and~~particularly ~~cause~~with usAI toand ~~lose~~cybersecurity ~~customers~~backgrounds, ~~users~~ and ~~future~~demand ~~business.~~for ~~Occasionally,~~cutting-edge weor ~~migrate~~unique ~~data~~skill ~~among~~sets ~~data~~may ~~centers~~continue ~~and~~ to ~~third-party~~be ~~hosted~~highly ~~environments.~~competitive, Ifboth aof ~~transition~~which ~~among~~are ~~data~~heightened ~~centers~~with orhybrid ~~to third-party service providers encounters unexpected interruptions, unforeseen complexity~~ or ~~unplanned~~remote ~~disruptions~~working ~~despite~~arrangements. ~~precautions~~Our ~~undertaken~~hybrid ~~during~~work ~~the~~environment ~~process, this~~ may ~~impair~~also ~~our~~present ~~delivery of products~~operational, ~~services~~security and ~~solutions~~workplace toculture ~~customers~~challenges, ~~and~~which ~~result~~could innegatively ~~increased~~affect ~~costs~~our ~~and~~ability ~~liabilities,~~to ~~which~~execute ~~may~~against ~~harm~~ our ~~operating~~business ~~results,~~objectives ~~reputation~~and retain and ~~our~~recruit ~~business~~personnel.

ItWe ishave ~~also possible that hardware or software failures or errors in our systems (or those of our third-party service providers) could result in data loss or corruption~~experienced, ~~cause~~and ~~the~~may ~~information~~continue ~~that we collect or maintain~~ to ~~be incomplete or contain inaccuracies that our customers regard as significant~~experience, orhigher ~~cause~~compensation uscosts to ~~fail~~retain toand ~~meet~~recruit ~~committed~~senior ~~service~~management ~~levels~~ or ~~comply~~highly ~~with~~skilled ~~applicable~~personnel ~~notification~~that ~~requirements or other relevant contractual obligations to our customers. Furthermore, our ability to collect and report data~~ may not be ~~delayed~~offset ~~or interrupted~~ by ~~a number of factors~~innovation, ~~including~~improved ~~access~~productivity ~~to the internet, the failure of our network~~ or ~~software~~increased ~~systems, security breaches or significant variability in visitor traffic on customer websites~~sales. We ~~may~~continue ~~also find, on occasion, that we cannot deliver data and reports~~ to ~~our~~hire ~~customers~~personnel in ~~near~~countries ~~real-time~~where ~~due~~exceptional totechnical ~~factors~~knowledge ~~such~~and asother ~~significant~~expertise ~~spikes~~are inoffered ~~customer~~at ~~activity~~lower oncosts, ~~their~~which ~~websites~~increases orthe ~~failures~~efficiency of our ~~network~~global orworkforce ~~software~~structure ~~(or~~and ~~that~~reduces ofour ~~a third~~personnel-~~party~~related ~~service provider)~~expenditures. IfNonetheless, weas ~~fail~~globalization ~~to plan infrastructure capacity appropriately and expand it proportionally with the needs of our customer and user base~~continues, ~~and~~competition wefor ~~experience~~talent ain ~~rapid and significant demand on the capacity of our data centers or~~ those ofcountries ~~third~~has ~~parties~~increased, ~~service outages or performance issues could occur,~~ which may impact our ~~customers.~~ability ~~Such a strain on our infrastructure capacity may subject us~~ to ~~regulatory~~retain ~~and~~these ~~customer~~employees ~~notification requirements, violations of service level agreement commitments or financial liabilities~~ and ~~result~~increase ~~in customer dissatisfaction or harm~~ our ~~business.~~compensation-related If we supply materially inaccurate information or experience significant interruptions in our systems, our reputation could be harmed, we could lose customers and we could be found liable for damages or incur other lossesexpenses.

Service interruptions or failures of our information technology systems or those of third parties may impair the availability of our solutions, which may expose us to liability, damage our reputation and harm our future financial results.

Much of our business, including our online store at adobe.com, our cloud solutions and various business processes such as our enterprise resource planning system and customer and sales support, relies on hardware and services that are hosted, managed and controlled directly by us or third-party service providers to be available to our customers and users without disruption. We do not have redundancy for all our systems, many of our critical applications (“apps”) reside in only one of our data centers, and our disaster recovery planning may not account for all eventualities. If any critical third-party service provider of hosting or content delivery services is negatively affected or becomes unavailable to us for any reason, we may not be able to deliver the corresponding solutions to our customers and users. Failure of our systems or those of our third-party service providers could cause large, system-wide failures, disrupt our business operations and those of our customers, subject us to reputational harm, require costly and time-intensive notifications, and cause us to lose customers, users and future business. Occasionally, we migrate data among data centers and to third-party hosted environments. If a transition among data centers or to third-party service providers encounters unexpected interruptions, unforeseen complexity or unplanned disruptions despite precautions undertaken during the process, this may impair our delivery of solutions to customers and result in increased costs and liabilities, which may harm our financial results, reputation and business.

It is also possible that hardware or software failures or errors in our systems (or those of our third-party service providers) could result in data loss or corruption, cause the information that we collect or maintain to be incomplete or contain inaccuracies that our customers regard as significant, or cause us to fail to meet committed service levels or comply with applicable notification requirements or other relevant contractual obligations to our customers. Furthermore, our ability to collect and report data may be delayed or interrupted by a number of factors, including access to the internet, the failure of our network or software systems, security breaches or significant variability in visitor traffic on customer websites. We may also find, on occasion, that we cannot deliver data and reports to our customers in near real-time due to factors such as significant spikes in customer activity on their websites or failures of our network or software (or that of a third-party service provider). If we fail to plan infrastructure capacity appropriately and expand it proportionally with the needs of our customer and user base, and we experience a rapid and significant demand on the capacity of our data centers or those of third parties, service outages or performance issues could occur, which may impact our customers. Such a strain on our infrastructure capacity may subject us

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to regulatory and customer notification requirements, violations of service level agreement commitments or financial liabilities and result in customer dissatisfaction or harm our business. If we supply materially inaccurate information or experience significant interruptions in our systems, our reputation could be harmed, we could lose customers and we could be found liable for damages or incur other losses.

Security incidents, improper access to or disclosure of our customers’ data or other cybersecurity incidents may harm our reputation and materially and adversely affect our business.

Our ~~products, services and~~ solutions collect, store, manage and otherwise process third-party data, including our customers’ data and our own data. Such ~~products, services and~~ solutions as well as our technologies, systems and networks have been subject to, and may in the future be subject to, cyberattacks, computer viruses, ransomware or other malware, fraud, worms, social engineering, denial-of-service attacks, malicious software programs, insider threats and other cybersecurity incidents that have in the past, and may in the future, result in the unauthorized access, disclosure, acquisition, use, loss or destruction of sensitive personal or business data belonging to us, our employees and our customers. Some of our solutions include third-party open-source software, which may contain security vulnerabilities that may be exploited, potentially compromising our solutions. Increasing use of AI in our internal systems and solutions may create new attack methods.

Cybersecurity incidents can be caused by human error from our workforce or that of our third-party service providers, by malicious third parties, acting alone or in groups, or by more sophisticated organizations, including nation-states and state-sponsored organizations. Such risks may be elevated in connection with geopolitical tensions, including the Russia-Ukraine war and the conflict in the Middle East, as well as malicious third parties utilizing emerging technologies, such as AI and machine learning. Certain unauthorized parties have in the past managed, and may in the future manage, to overcome our security measures and those of our third-party service providers to access and misuse systems and software by exploiting defects in design, configuration or manufacture, including bugs, vulnerabilities, change management errors and other problems that unexpectedly compromise the security or operation of a product or system. Further, unauthorized parties or authorized parties that exceed their authorized access may also gain physical access to our facilities and infiltrate our information systems or attempt to gain logical access to our ~~products,~~solutions ~~services~~ or information systems to access content and data and may result in computer viruses, worms, ransomware or other malware. Malicious third parties have in the past, and may in the future, fraudulently induce our employees or users of our ~~products, services or~~ solutions to disclose sensitive, personal or confidential information via illegal electronic spamming, phishing, social engineering or other tactics, and this risk is heightened in our current hybrid model working environment. Malicious actors may also engage in fraudulent or abusive activities through our products, services and solutions, including unauthorized use of accounts through stolen credentials, use of stolen credit cards or other payment vehicles, failure to pay for services accessed, or other activities that

26Our solutions are incorporated into the supply chain of a large number of companies worldwide and, as a result, if our solutions experience a compromise, a large portion or, in some instances, all of our customers and their data for a given solution could be simultaneously affected. The potential liability and associated consequences we could suffer as a result of such a large scale event could be significant, and materially and adversely impact our business. Malicious actors may also engage in fraudulent or abusive activities through our solutions, including unauthorized use of accounts through stolen credentials, use of stolen credit cards or other payment vehicles, failure to pay for services accessed, or other activities that violate our terms of service. While we actively combat such fraudulent activities, we have experienced, and may in the future experience, impacts to our revenue and reputation from such activities.

Maintaining the security of our solutions is a critical issue for us and our customers. We devote significant resources to address security vulnerabilities through various methods, including, but not limited to, engineering more secure products, enhancing security and reliability features in our products and systems, regularly reviewing our service providers’ security controls, and continually assessing and improving, as appropriate, our incident response process. However, it is impossible to accurately predict the extent, frequency or impact cybersecurity issues may have on us, and our security measures do not provide full effective protection from all such events. There can be no assurance that we have the capability to detect all vulnerabilities or new attack methods and our internal security controls may not keep pace with quickly evolving threats. The costs to prevent, eliminate, mitigate or remediate cybersecurity or other security problems and vulnerabilities are significant and may reduce our margins. Breaches of our security measures and the accidental loss, inadvertent disclosure or unauthorized dissemination of proprietary information or sensitive, personal or confidential data about us, our employees, our customers or their end users, including the potential loss or disclosure of such information or data have in the past, and could in the future, expose us, our employees, our customers or other individuals affected to a risk of loss or misuse of this information. Further, our efforts to address these problems, including notifying affected third parties when appropriate, have in the past been, and may in the future be, unsuccessful or delayed, which could result in business interruptions, cessation of service, loss of existing or potential customers and reputational harm. Actual or perceived security vulnerabilities or incidents have resulted in, and may result in additional, claims or litigation and liability or fines, costly and time-intensive notice requirements, governmental inquiry or oversight or a loss of customer confidence, any of which have in the past and may in the future harm our business and damage our brand and reputation. Our customers may also adopt security measures to protect their computer systems and their instances of our software from attack and may suffer a cybersecurity breach on their own systems, unrelated to our

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~~violate~~systems. ~~our~~Even ~~terms~~if ofsuch ~~service.~~breach ~~While~~is weunrelated ~~actively~~to ~~combat~~our ~~such~~security ~~fraudulent activities~~systems, wesolutions ~~have~~or ~~experienced~~programs, such breach could cause us reputational harm and ~~may~~require inus ~~the~~to ~~future~~incur ~~experience~~significant economic and operational consequences to adequately assess and respond to their breach, ~~impacts~~and to ~~our~~implement ~~revenue~~additional ~~from~~safeguards ~~such~~designed ~~activities~~to protect against future breaches.

~~Maintaining~~While ~~the~~we ~~security~~maintain ofinsurance ~~our products, services and solutions is a critical issue for us and our customers. We devote significant resources~~ to ~~address~~cover ~~security~~operational ~~vulnerabilities through various methods~~risks, ~~including,~~such ~~but~~as ~~not~~cybersecurity ~~limited~~risk ~~to, engineering more secure products, enhancing security~~ and ~~reliability~~technology ~~features in our products and systems~~outages, ~~regularly reviewing~~ our ~~service~~insurance providers’ security controls, and continually assessing and improving, as appropriate, our incident response process. However, it is impossible to accurately predict the extent, frequency or impact cybersecurity issues may ~~have on us, and our security measures do~~ not ~~provide~~be ~~full~~sufficient ~~effective~~to ~~protection~~cover ~~from~~ all ~~such~~liability ~~events~~described herein. ~~The~~These ~~costs~~risks towill ~~prevent,~~likely ~~eliminate,~~increase ~~mitigate~~as orwe ~~remediate~~expand ~~cybersecurity or other security problems and vulnerabilities are significant and may reduce~~ our ~~margins.~~hosted ~~Breaches~~solutions, ofintegrate our ~~security~~solutions ~~measures~~ and ~~the~~store ~~accidental~~and ~~loss,~~process ~~inadvertent~~more ~~disclosure or unauthorized dissemination of proprietary information or sensitive, personal or confidential~~ data. ~~about us~~Moreover, ~~our~~delayed ~~employees~~sales, ~~our~~lower ~~customers~~margins or ~~their~~lost ~~end~~customers ~~users,~~resulting ~~including~~from ~~the~~disruptions ~~potential~~caused ~~loss~~by orcyberattacks, ~~disclosure of such information or~~ data ~~have in the past~~breaches, ~~and~~overly ~~could~~burdensome inpreventive ~~the~~security ~~future,~~measures ~~expose us, our employees, our customers~~ or ~~other~~failure ~~individuals affected~~ to afully ~~risk~~meet ~~of loss or misuse of this~~ information. Further, our efforts to address these problems, including notifying affected third parties when appropriate, have in the past been, and may in the future be, unsuccessful or delayed, which could result in business interruptions, cessation of service, loss of existing or potential customers and reputational harm. Actual or perceived security ~~vulnerabilities~~control orcertification ~~incidents have resulted in, and may result in additional, claims or litigation and liability or fines, costly and time-intensive notice~~ requirements, ~~governmental inquiry or oversight or a loss of customer confidence, any of which~~ could ~~harm~~materially ~~our business~~ and ~~damage~~adversely ~~our~~affect ~~brand and reputation. Our customers may also adopt security measures to protect their computer systems and their instances of~~ our ~~software~~financial ~~from attack and may suffer a cybersecurity breach on their own systems~~results, ~~unrelated~~stock toprice ~~our systems. Even if such breach is unrelated to our security systems, solutions or programs, such breach could cause us reputational harm~~ and require us to incur significant economic and operational consequences to adequately assess and respond to their breach, and to implement additional safeguards designed to protect against future breachesreputation.

~~While~~If we ~~maintain~~are ~~insurance~~unable to ~~cover operational risks~~develop, ~~such~~manage ~~as cybersecurity risk~~ and ~~technology~~maintain ~~outages,~~ our ~~insurance~~sales ~~may~~channels, ~~not~~including ~~be sufficient to cover all liability described herein. These risks will likely increase as we expand~~ our ~~hosted~~direct ~~offerings~~sales force, ~~integrate~~third-party ~~our products~~distributors, ~~services~~ and ~~solutions and store and process more data. Moreover, delayed~~ sales, ~~lower margins or lost customers resulting from disruptions caused by cyberattacks~~partners, ~~overly burdensome preventative security measures~~ or ~~failure~~third-party torelationships ~~fully~~upon ~~meet~~which ~~information~~we ~~security~~rely ~~control~~for ~~certification~~critical ~~requirements~~business ~~could~~operations, ~~materially and adversely affect~~ our ~~financial~~revenue ~~results,~~and ~~stock~~business ~~price~~may ~~and~~be ~~reputation~~adversely affected.

IfWe werely ~~are~~on ~~unable~~our todirect ~~develop,~~sales ~~manage~~channel and ~~maintain~~a ~~critical~~number of third-party distributors and sales partners to distribute our solutions. The successful management of these relationships is a complex, ~~such~~global asprocess. We sell many solutions through our direct sales force. Risks associated with this sales channel include challenges related to hiring, ~~partner~~retaining and ~~distribution~~motivating ~~channels~~our direct sales force, ~~suppliers~~and substantial amounts of ongoing training for sales representatives. Our business could be harmed if our direct sales expansion efforts do not generate the corresponding efficiencies and ~~service~~revenue ~~providers~~we anticipated from such investment. In addition, the loss of key sales employees could impact our ~~revenue~~customer relationships and ~~business~~future ~~may~~ability beto ~~adversely~~sell ~~affected~~to certain accounts covered by such employees.

WeMoreover, ~~rely~~if onour apartner ~~number~~and ofdistribution ~~third-party~~channels ~~distributors~~are ~~and~~not ~~sales~~effective ~~partners~~or toif ~~distribute~~we stop or change our ~~products~~partner or distribution channels, ~~services~~we ~~and~~may ~~solutions.~~lose ~~The~~sales ~~successful~~opportunities, ~~management~~customers ofand ~~such~~revenue. We rely on third-party ~~relationships~~distribution isplatforms aand ~~complex,~~are ~~global~~subject ~~process.~~to Ifchanges anin ~~agreement~~pricing ~~with~~structure, ~~one~~terms of ~~our~~service, ~~distributors~~privacy orpractices ~~partners~~and ~~was~~other ~~terminated,~~policies ~~any~~at ~~prolonged~~the ~~delay~~discretion inof ~~securing~~the aplatform ~~replacement~~provider. ~~distributor~~Any oradverse ~~partner~~changes ~~could~~to ~~have~~the aterms ~~negative~~with ~~impact~~such onthird-party ~~our~~distribution ~~results~~platforms ofwhich ~~operations.~~we Werely ~~also~~on ~~face~~to ~~legal~~distribute ~~risk~~our ~~and~~solutions ~~potential~~may ~~reputational~~adversely ~~harm~~affect ~~from~~our ~~the~~financial ~~activities~~results. ofAdditionally, ~~these~~our ~~independent~~distribution ~~third~~channels ~~parties~~may ~~including, but~~ not ~~limited~~continue to, ~~export~~market ~~control~~or ~~violations,~~sell ~~workplace~~our ~~conditions,~~solutions ~~corruption~~effectively and ~~anti-competitive~~may ~~behavior~~favor solutions of other companies.

If ~~our~~an ~~partner~~agreement ~~and~~with ~~distribution~~one ~~channels~~of ~~are not effective or if we stop or change~~ our ~~partner~~distributors or ~~distribution~~partners ~~channels,~~was ~~we may lose sales opportunities~~terminated, ~~customers~~any ~~and~~prolonged ~~revenue.~~delay Wein ~~rely~~securing ona ~~third-party~~replacement ~~distribution~~distributor ~~platforms~~or ~~and~~partner ~~are~~could ~~subject~~have toa ~~changes~~negative inimpact ~~pricing~~on ~~structure,~~our ~~terms~~results of ~~service,~~operations. ~~privacy~~We ~~practices~~also ~~and~~face ~~other~~legal ~~policies~~risk atand ~~the~~potential ~~discretion~~reputational ofharm ~~the~~from ~~platform provider. Any adverse changes to~~ the ~~terms~~activities ~~with~~of ~~such~~these independent third~~-party~~ ~~distribution~~parties ~~platforms which we rely on to distribute our products~~including, ~~services~~but ~~and solutions may adversely affect our financial results. Additionally, our distribution channels may~~ not ~~continue~~limited to, ~~market~~export orcontrol ~~sell our products~~violations, ~~services~~workplace ~~and solutions effectively and may favor products~~conditions, ~~services~~corruption and ~~solutions~~anti-competitive ~~of other companies~~behavior.

We ~~sell~~also ~~many~~rely ~~products,~~on ~~services~~third-party service providers and ~~solutions~~technologies ~~through~~to deliver our ~~direct~~solutions ~~sales~~and ~~force.~~business ~~Risks~~operations ~~associated~~and ~~with~~to ~~this~~operate ~~sales~~critical ~~channel~~business ~~include~~systems, ~~challenges~~such ~~related~~as tocloud-based ~~hiring~~infrastructure, ~~retaining~~data ~~and~~center ~~motivating~~facilities, ~~our~~generative ~~direct~~AI, ~~sales~~large ~~force~~language models, encryption and ~~substantial~~authentication ~~amounts~~technology, ofcompany ~~ongoing~~email ~~training~~and ~~for~~other ~~sales~~communication ~~representatives~~channels, and communications with customers. ~~Our~~If ~~business~~such ~~could~~third beparties ~~harmed~~are negatively affected, if we fail to effectively develop, manage and maintain our ~~direct~~relationships ~~sales~~with ~~expansion~~such ~~efforts~~third doparties, ~~not~~or ~~generate~~if ~~the~~we ~~corresponding~~are ~~efficiencies~~unable ~~and~~to ~~revenue~~renew our agreements with them on favorable terms or at all, our expenses could significantly increase, and we ~~anticipated~~and ~~from~~our ~~such~~customers ~~investment~~may experience service interruptions. InAny ~~addition~~disruption or damage to, or failure of our systems generally, including the ~~loss~~systems of ~~key~~our ~~sales~~third-party ~~employees~~platform providers, could ~~impact~~result in interruptions in our ~~customer~~services ~~relationships~~and harm our business. Further, interruptions in our services caused by us or our third-party service providers may cause us to issue credits or pay penalties, cause customers to make warranty or other claims against us or to terminate their subscriptions or contracts, and ~~future~~adversely affect our attrition rates and our ability to ~~sell~~attract tonew ~~certain~~customers, ~~accounts~~all ~~covered~~of bywhich ~~such~~may ~~employees~~adversely affect our financial results. Our business and reputation would also be harmed if our customers and potential customers believe our services are unreliable.

We ~~rely~~face onvarious ~~third-party~~risks ~~service~~associated ~~providers~~with ~~and~~operating ~~technologies to deliver our products, services and business operations and to operate critical business systems, such~~ as ~~cloud-based~~a ~~infrastructure,~~multinational ~~data center facilities~~corporation, ~~generative AI, encryption~~ and ~~authentication~~global ~~technology,~~adverse ~~company~~economic ~~email~~ and ~~communications~~geopolitical ~~with~~conditions ~~customers.~~may Ifharm ~~such third parties are negatively affected, if we fail to effectively develop, manage and maintain~~ our ~~relationships~~business ~~with such third parties, or if we are unable to renew our agreements with them on favorable terms or at all, our expenses could significantly increase,~~ and wefinancial ~~and~~condition. ~~our customers may~~

27We derive a large portion of our total revenue from, and have significant operations, outside of the United States. As a multinational corporation, we are subject to a number of risks, including from global adverse economic and geopolitical conditions, that are uncertain and beyond our control and that make forecasting financial results and decisions about future investments difficult, such as:

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experience service interruptions. Any disruption or damage to, or failure of our systems generally, including the systems of our third-party platform providers, could result in interruptions in our services and harm our business. Further, interruptions in our services caused by us or our third-party service providers may cause us to issue credits or pay penalties, cause customers to make warranty or other claims against us or to terminate their subscriptions or contracts, and adversely affect our attrition rates and our ability to attract new customers, all of which may adversely affect our financial results. Our business and reputation would also be harmed if our customers and potential customers believe our services are unreliable.

We face various risks associated with our operating as a multinational corporation, and global adverse economic conditions may harm our business and financial condition.

We derive a large portion of our total revenue from, and have significant operations, outside of the United States. As a multinational corporation, we are subject to a number of risks, including from global adverse economic conditions, that are uncertain and beyond our control and that make forecasting operating results and decisions about future investments difficult, such as:

•inflation and actions taken by central banks to counter inflation, including increasing interest rates;

•international and regional economic, political and labor conditions, including any instability or security concerns abroad, such as uncertainty caused by economic sanctions, downturns and recessions, trade disputes, tariffs, armed conflicts and wars, and epidemics and pandemics like COVID-19;

~~•tax laws (including U.S. taxes on foreign subsidiaries);~~ 22

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•tax laws in the United States as well as other countries and jurisdictions;

•increased financial accounting and reporting burdens and complexities;

•changes in, or impositions of, legislative or regulatory requirements in the United States and other countries, including antitrust and competition regulations, consumer protection laws, or other government actions;

•changes in laws governing the ~~free~~ flow of data across ~~international~~ borders including into the United States;

•inadequate local infrastructure and difficulties in managing and staffing international operations;

•costs, potential liability, delays or loss of sales resulting from trade restrictions imposed by the United States and other countries, as well as trade laws, including but not limited to economic sanctions, tariffs and export controls;

•costs and delays associated with developing products in multiple languages; and

•operating in locations with a higher rate of corruption and fraudulent business practices.

Additionally, third parties we do business with and our customers have international operations and are also subject to the above risks. Adverse changes in global economic conditions, including, but not limited to recessions or slow economic growth have in the past resulted and may in the future result in our customers’ and business partners’ insolvency, inability to obtain credit to finance or purchase our ~~products, services and~~ solutions, or a delay in paying or an inability to pay their obligations to us. Other third parties, such as our service providers, suppliers and distributors, may be unable to deliver or be delayed in delivering critical services, products or technologies that we rely on, and our business and reputation may be harmed. Our customers’ spending rate, ability to pay and demand for our ~~products, services and~~ solutions may also be adversely affected by the above risks. If our global sales are reduced, delayed or canceled because of any of the above risks, our revenue may decline.

Further, a disruption in global financial markets could impair our banking partners, on which we rely for operating cash management, capital market transactions and derivative programs. Such disruption could also negatively impact our customers’ ability to pay us due to delays or inability to access their existing cash.

As of November 2928, ~~2024~~2025, our investment portfolio consisted of money market funds, corporate debt securities, U.S. Treasury securities, time deposits, ~~U.S. agency securities~~ and ~~asset-backed~~other ~~securities~~investments. These investments are subject to credit, liquidity, market, and interest rate risks as well as economic downturns or events that affect global or regional financial markets that may cause the value of our investments to decline, requiring impairment charges, which could adversely affect our financial condition.

Some of our enterprise ~~offerings~~solutions have extended and complex sales cycles, which may increase our costs and make our sales cycles unpredictable.

As we continue to target enterprise customers for certain of our ~~offerings~~solutions, ~~including~~we ~~Adobe~~may ~~Experience~~face ~~Cloud~~increased costs, longer sales cycles, greater competition and less predictability in completing our ~~Digital~~sales. ~~Experience~~For ~~business~~our enterprise customers, the evaluation process may be longer and ~~our~~more ~~Enterprise~~involved, ~~Term~~and ~~License~~require ~~Agreements~~us to invest more in educating our ~~Digital~~customers ~~Media~~about ~~business~~our solutions, weparticularly because the decision to use our solutions is often an enterprise-wide decision. We are increasingly offering end-to-end solutions that include generative and agentic AI capabilities, which have in the past, and may ~~face~~in ~~increased~~the ~~costs~~future, ~~longer~~increase the complexity of technical or contractual assurances or requirements that we or our customers require, whether pursuant to regulations or internal policies, as part of the contracting process, leading to extended sales cycles. We may be required to submit more robust proposals, ~~greater~~participate ~~competition~~in ~~and~~extended ~~less~~proof-of-concept ~~predictability~~evaluation cycles and engage in ~~completing~~more extensive contract negotiations. In addition, our enterprise customers often demand more complex configurations and additional integration services and product features. Adverse macroeconomic and geopolitical events such as trade disputes and tariffs have caused, and may continue to cause, additional spend scrutiny and delays in our enterprise customers’ purchasing decisions, particularly for larger and more complex deals. Due to these factors, we often must devote greater sales support to certain enterprise customers, which increases our costs and time required to complete a sale, without assurance that potential customers will ultimately purchase our solutions. ~~For~~We also may be required to devote more services resources to implementation, which increases our costs, without assurance that customers receiving these services will renew or renew at the same level. Our revenue from enterprise customers may be affected by longer-than-expected sales, contract negotiation and implementation cycles, extended collection cycles, potential deferral of revenue and alternative licensing arrangements. Additionally, our enterprise sales pattern has historically been, and is expected to remain, uneven, where a higher percentage of a quarter’s total sales occur during the final weeks of each quarter, which is common in our industry.

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evaluation process may be longer and more involved, and require us to invest more in educating our customers about our products, services and solutions, particularly because the decision to use our products, services and solutions is often an enterprise-wide decision. We are increasingly offering end-to-end solutions that include cross-cloud and generative AI capabilities, which have in the past, and may in the future, increase the complexity of technical or contractual assurances or requirements that we or our customers require as part of the contracting process, leading to extended sales cycles. We may be required to submit more robust proposals, participate in extended proof-of-concept evaluation cycles and engage in more extensive contract negotiations. In addition, our enterprise customers often demand more complex configurations and additional integration services and product features. Adverse macroeconomic conditions have caused, and may continue to cause, additional spend scrutiny and delays in our enterprise customers’ purchasing decisions. Due to these factors, we often must devote greater sales support to certain enterprise customers, which increases our costs and time required to complete a sale, without assurance that potential customers will ultimately purchase our solutions. We also may be required to devote more services resources to implementation, which increases our costs, without assurance that customers receiving these services will renew or renew at the same level. Since the sales cycles for our enterprise offerings are multi-phased and complex, it is often unpredictable when a given sales cycle will close. Our revenue from enterprise customers may be affected by longer-than-expected sales, contract negotiation and implementation cycles, extended collection cycles, potential deferral of revenue and alternative licensing arrangements. Additionally, our enterprise sales pattern has historically been, and is expected to remain, uneven, where a higher percentage of a quarter’s total sales occur during the final weeks of each quarter, which is common in our industry.

If we are unable to recruit and retain key personnel, our business may be harmed, and our hybrid work model may present challenges, which could adversely impact our business.

Much of our future success depends on the continued service, availability and performance of our senior management and highly skilled personnel across all levels of our organization. Our senior management has acquired specialized knowledge and skills with respect to our business, and the loss of any of these individuals could harm our business, especially if we are not successful in developing adequate succession plans. Our efforts to attract, develop, integrate and retain highly skilled employees may be compounded by intensified restrictions on immigration or the availability of work visas. The technology industry has been and may continue to be subject to substantial and continuous competition for talent, particularly with AI and cybersecurity backgrounds, and demand for cutting-edge or unique skill sets may continue to be highly competitive, both of which are heightened with hybrid or remote working arrangements. Our hybrid work environment may also present operational, security and workplace culture challenges, which could negatively affect our ability to execute against our business objectives and retain and recruit personnel. We have experienced, and may continue to experience, higher compensation costs to retain and recruit senior management or highly skilled personnel that may not be offset by innovation, improved productivity or increased sales. We continue to hire personnel in countries where exceptional technical knowledge and other expertise are offered at lower costs, which increases the efficiency of our global workforce structure and reduces our personnel-related expenditures. Nonetheless, as globalization continues, competition for talent in those countries has increased, which may impact our ability to retain these employees and increase our compensation-related expenses.

Risks Related to Laws and Regulations

We are, and may in the future become, subject to litigation, regulatory inquiries, investigations and other ~~claims~~actions, which could result in an unfavorable outcome and have an adverse effect on our business, financial condition, results of ~~operation~~operations and cash flows.

We are, and may in the future become, subject to various legal proceedings (including class action lawsuits), claims, negotiations, ~~and~~ regulatory inquiries, ~~and additional claims~~investigations, enforcement actions and ~~inquiries~~other ~~may arise in the future~~actions, ~~such~~including ~~as those~~ relating to antitrust, consumer protection, data privacy and security, ~~consumer~~employment ~~protection~~practices, product liability and the validity or alleged infringement of third-party intellectual property rights, including patent rights, among others. Such activity has increased over time with evolving global regulatory and enforcement landscapes and as our ~~products, services and~~ solutions have become more available to, and used by, more enterprises and consumers worldwide. For example, there is an increase in ~~enforcement~~regulatory activity in connection with federal and state consumer protection laws, including some suits which seek civil penalties. Any proceedings, actions, claims or inquiries initiated by or against us, whether successful or not, may be highly time consuming; result in costly litigation, damage awards, consent decrees, injunctive relief or increased costs of business; require us to change our business practices or products; result in negative publicity; require significant amounts of management time; result in the diversion of significant operational resources; or otherwise harm our business and financial results.

Disputes and litigation can be complex and are typically costly and can be disruptive to our business operations by diverting the attention of management and key personnel. For example, third-party intellectual property disputes, including those initiated by patent assertion entities or competitors, could subject us to significant liabilities, require us to enter into royalty and licensing arrangements on unfavorable terms, prevent us from offering certain ~~products, services or~~ solutions, subject us to injunctions restricting our sales, cause severe disruptions to our operations or the markets in which we compete, or require us to satisfy indemnification commitments with our customers, including contractual provisions under various license arrangements and service agreements. In addition, we have incurred, and may in the future incur, significant costs in acquiring the necessary third-party intellectual property rights for use in our products, in some cases to fulfill contractual obligations with our customers. Any of these occurrences could significantly harm our business.

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indemnification commitments with our customers, including contractual provisions under various license arrangements and service agreements. In addition, we have incurred, and may in the future incur, significant costs in acquiring the necessary third-party intellectual property rights for use in our products, in some cases to fulfill contractual obligations with our customers. Any of these occurrences could significantly harm our business.

We have not prevailed, and may not in the future prevail, in every lawsuit or dispute. For further information about specific litigation and proceedings, see the section titled “Legal Proceedings” contained in Part II, Item 8, Note 16 of our Notes to Consolidated Financial Statements of this report.

We are subject to risks associated with compliance with laws and regulations globally, which may harm our business.

We are a global company subject to varied and complex laws, regulations, government actions and customs, both domestically and internationally. These local, state, federal and international laws and regulations relate to a number of aspects of our business, including trade laws such as import and export controls, anti-boycott, economic sanctions and embargoes, data and transaction processing security, payment card industry data security standards, antitrust and competition, consumer protection, records management, user-generated content hosted on websites we operate, privacy practices, data residency and transfer, AI ~~regulations~~, corporate governance, ~~antitrust~~employment ~~and~~practices, ~~competition~~immigration, employee and third-party complaints, anti-corruption, conflicts of interest, securities regulations, sustainability and other regulatory requirements affecting trade and investment. The application of these laws and regulations to our business is often unclear and evolving, and may at times conflict. Further, we are subject to the U.S. Foreign Corrupt Practices Act and other anti-corruption and anti-bribery laws, which may conflict with local customs and practices in other foreign countries, particularly those with developing economies where it is common to engage in practices that would be prohibited under such laws. We cannot provide assurance that our employees, contractors, agents, business partners and vendors will not take actions in violation of our internal policies, U.S. laws or other applicable international laws. Compliance with the above laws and regulations may involve significant costs or require additional changes to our business practices that result in reduced revenue and profitability. Non-compliance could also result in fines, damages, criminal sanctions against us, our officers or our employees, prohibitions on the conduct of our business and damage to our reputation.

In addition, approximately 50% of our employees are located outside the United States. Accordingly, we are exposed to changes in laws governing our employee relationships in various U.S. and foreign jurisdictions, including laws and regulations regarding wage and hour requirements, fair labor standards, employee data privacy, unemployment tax rates, workers’ compensation rates, citizenship requirements, immigration and payroll and other taxes, which likely would have a direct impact on our operating costs.

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Increasing regulatory focus on privacy and security issues and expanding laws and regulatory requirements could impact our business models and expose us to increased liability.

We are subject to global data protection, privacy and security laws, regulations and codes of conduct that relate to our various business units and data processing activities, which may include sensitive, confidential, and personal information. These laws, regulations and codes are increasing in number, expanding in scope, inconsistent across jurisdictions and ~~are~~ subject to evolving and differing (sometimes conflicting) interpretations. Government officials and regulators, privacy advocates and class action attorneys are increasingly scrutinizing how companies collect, process, use, store, share and transmit personal data, including the transferring of personal information across international borders. This scrutiny can result in new and shifting interpretations of existing laws, thereby further impacting our business. For example, European data transfers outside the European Economic Area are highly regulated and litigated. The mechanisms that we and many other companies rely upon for European data transfers (for example, Standard Contractual Clauses and the EU - US Data Privacy Framework) are the subject of legal challenge, regulatory interpretation and judicial decisions by the Court of Justice of the European Union. ~~Several~~Certain other countries, ~~including~~in ~~but~~which ~~not~~we ~~limited~~do tobusiness ~~the United States, China, Australia, New Zealand, Brazil, Kingdom of Saudi Arabia, Hong Kong and Japan,~~ have also established specific legal requirements for cross-border transfers of personal information and ~~certain countries have also established specific legal requirements for~~ data localization ~~(such as where personal data must remain stored in the country)~~. If these or other countries implement more restrictive regulations for cross-border data transfers or do not permit data to leave the country of origin, such developments could adversely impact our business and our enterprise customers’ business, our financial condition and our results of operations in those jurisdictions. Additionally, the General Data Protection Regulation in the European Economic Area and the United Kingdom continues to be interpreted by European and UK courts in novel ways leading to shifting requirements, country-specific differences in application and uncertain enforcement priorities. Laws in Asia, such as the Personal Information Protection Law in China and developing laws in India, as well as state laws in the United States on privacy, data and related technologies, such as the California Consumer Privacy Act, the California Privacy Rights Act, the Colorado Privacy Act and the Virginia Consumer Data Protection Act, as well as industry self-regulatory codes and regulatory requirements, create additional privacy and security compliance obligations and expand the scope of potential liability, either jointly or severally with our customers and suppliers. Further, the U.S. Securities and Exchange Commission’s Rules on Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure requires us to make certain disclosures related

30We may be subject to certain aspects of the EU’s Digital Services Act, which imposes additional legal requirements on certain types of digital service providers, including online platforms and content sharing sites. Moreover, some of our customers are subject to the EU’s Digital Operational Resilience Act and similar UK regulatory requirements on operational resilience. There may be certain aspects of the EU’s Data Act that could apply to certain types of cloud services providers and require them to facilitate data portability (e.g., switching between services), as well as certain requirements concerning cross border international transfers of, and governmental access to, non-personal information outside of the European Economic Area. Further, the U.S. Department of Justice issued a rule entitled Preventing Access to U.S. Sensitive Personal Data and Government-Related Data by Countries of Concern or Covered Persons, which placed additional restriction on certain data transactions involving countries of concern and covered individuals that may impact certain business activities, and has impacted the transfer of data in connection with certain transactions.

Additionally, the General Data Protection Regulation in the European Economic Area and the United Kingdom continues to be interpreted by European and UK courts in novel ways leading to shifting requirements, country-specific differences in application and uncertain enforcement priorities. Laws in Asia, such as the Personal Information Protection Law in China, Personal Information Protection Act in Korea and developing privacy laws in India, as well as state laws in the United States on privacy, data and related technologies, such as the California Consumer Privacy Act, the California Privacy Rights Act, the Colorado Privacy Act and the Virginia Consumer Data Protection Act, as well as industry self-regulatory codes and regulatory requirements, create additional privacy and security compliance obligations and expand the scope of potential liability, either jointly or severally with our customers and suppliers. Further, the U.S. Securities and Exchange Commission’s Rules on Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure and other expanding global laws require us to make certain disclosures related to material cybersecurity incidents and the reasonably likely impact of such an incident. Determining whether a cybersecurity incident is notifiable or reportable may not be straightforward and any such mandatory disclosures could be costly and lead to negative publicity, loss of customer confidence in the effectiveness of our security measures, diversion of management’s attention and governmental investigations. While we have invested in readiness to comply with applicable requirements, the dynamic and evolving nature of these laws, regulations and codes, as well as their interpretation by regulators, courts and customers, may affect our ability (and our enterprise customers’ ability) to reach current and prospective customers, to respond to both enterprise and individual customer requests under the laws (such as individual rights of access, correction and deletion of their personal information), to implement our business models effectively and to adequately address disclosure requirements.

The laws, regulations and codes above may impact our innovation and business drivers in developing new and emerging technologies (for example, AI and machine learning) and may impact demand for our solutions and has resulted in more onerous obligations in our contracts and changes to our business practices, and may require us to bear additional burdensome contractual obligations and make additional changes to our business practices in the future. These changes may impact the duration of customer relationships and result in additional compliance and operational costs, which may adversely impact our business. Perception of our practices or solutions, even if unfounded, as a violation of individual privacy, data protection rights, cybersecurity or related contractual requirements, subjects us to public criticism, lawsuits, investigations, audits, claims and other proceedings by regulators, industry groups, customers or other third parties, all of which could disrupt or adversely impact our business and reputation and expose us to increased liability, fines, lost revenue and other punitive measures including prohibition on sales of our solutions, restrictive judicial orders, disgorgement of data or other adverse consequences. Additionally, we collect and store information on behalf of our business customers and if our customers fail to comply with contractual obligations or applicable laws, it could result in litigation or reputational harm to us.

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to material cybersecurity incidents and the reasonably likely impact of such an incident on Form 8-K. Determining whether a cybersecurity incident is notifiable or reportable may not be straightforward and any such mandatory disclosures could be costly and lead to negative publicity, loss of customer confidence in the effectiveness of our security measures, diversion of management’s attention and governmental investigations.

While we have invested in readiness to comply with applicable requirements, the dynamic and evolving nature of these laws, regulations and codes, as well as their interpretation by regulators and courts, may affect our ability (and our enterprise customers’ ability) to reach current and prospective customers, to respond to both enterprise and individual customer requests under the laws (such as individual rights of access, correction and deletion of their personal information), to implement our business models effectively and to adequately address disclosure requirements. These laws, regulations and codes may also impact our innovation and business drivers in developing new and emerging technologies (for example, AI and machine learning) and may impact demand for our offerings and force us to bear the burden of more onerous obligations in our contracts. Perception of our practices, products, services or solutions, even if unfounded, as a violation of individual privacy, data protection rights or cybersecurity requirements, subjects us to public criticism, lawsuits, investigations, claims and other proceedings by regulators, industry groups or other third parties, all of which could disrupt or adversely impact our business and reputation and expose us to increased liability, fines and other punitive measures including prohibition on sales of our products, services or solutions, restrictive judicial orders and disgorgement of data. Additionally, we collect and store information on behalf of our business customers and if our customers fail to comply with contractual obligations or applicable laws, it could result in litigation or reputational harm to us.

Our intellectual property portfolio is a valuable asset and we may not be able to protect our intellectual property rights, including our source code, from infringement or unauthorized copying, use or disclosure.

Our patents, trademarks, trade secrets, copyrights and other intellectual property are valuable assets to us. Infringement or misappropriation of such intellectual property could result in lost revenues and ultimately reduce their value. We protect our intellectual property by relying on federal, state and common law rights in the United States and internationally, as well as a variety of administrative procedures and contractual restrictions. Despite our efforts, protecting our intellectual property rights and preventing unauthorized use of our intellectual property are inherently difficult. For instance, we actively combat software piracy, but we continue to lose revenue due to illegal use of our software. Third parties may illegally copy and sell counterfeit versions of our products. To the extent counterfeit installations and sales replace otherwise legitimate ones, our ~~operating~~financial results could be adversely affected. We apply for patents and other intellectual property rights in the United States and in foreign countries, but we are not always successful in obtaining patent or other intellectual property protection or in obtaining such protection timely to meet our business needs. Our patents may be invalidated or circumvented. Moreover, due to challenges in detecting patent infringement pertaining to generative AI technologies, it may be more difficult to protect our generative AI and related innovations with patents. Additionally, if we use generative AI in the creation of our source code or other materials or inventions, we may not be able to rely on ~~copyright~~copyrights or patents to protect such intellectual property. Further, the laws of some foreign countries do not provide the same level of intellectual property protection as U.S. laws and courts and could fail to adequately protect our intellectual property rights. If unauthorized disclosure of our source code occurs through security breach, cyber-attack, contributions to open-source projects or otherwise, we could lose future trade secret protection for that source code. Such loss could make it easier for third parties to compete with our products by copying functionality, which could cause us to lose customers and could adversely affect our revenue and operating margins. If we cannot protect our intellectual property against unauthorized copying, use, or other misappropriation, our business could be harmed.

Changes in tax rules and regulations or interpretations thereof may adversely affect our effective tax rates.

We are a U.S.-based multinational company subject to tax in multiple domestic and foreign tax jurisdictions. Significant judgment is required in determining our current provision for income taxes and deferred tax assets or liabilities. Tax laws in the United States as well as other countries and jurisdictions in which we conduct business are subject to change as new laws are passed and/or new interpretations are made available, which have in the past and may in the future have a material impact on our business. These countries, governmental bodies, such as the European Commission of the European Union, and intergovernmental economic organizations, such as the Organization for Economic Cooperation and Development, have made and/or could make other unprecedented assertions about how taxation is determined and, in some cases, have proposed or enacted new laws that are contrary to the way in which rules and regulations have historically been interpreted and applied.

Changes in our operating landscape, such as changes in laws or interpretations of tax rules, ~~could~~have in the past and may in the future adversely affect our effective tax rates and/or cause us to respond by making changes to our business structure, which could adversely affect our operations and financial results. Our future effective tax rates ~~are~~may ~~likely to~~ be unfavorably affected by changes in the tax rates in jurisdictions where our income is earned, changes in jurisdictions in which our profits are determined to be earned and taxed, changes in the valuation of our deferred tax assets and liabilities, changes in or interpretation of tax rules and regulations in the jurisdictions in which we do business, or unexpected negative changes in business and market conditions that could reduce certain tax benefits. An increase in our effective tax rate would reduce our profitability.

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Moreover, we are subject to the examination of our income tax returns by domestic and foreign tax authorities. We regularly assess the likelihood of outcomes resulting from these examinations to determine the adequacy of our provision for income taxes and have reserved for potential adjustments that may result from these examinations. While we believe our tax estimates are reasonable, we cannot provide assurance that the final determination of any of these examinations will not have an adverse effect on our financial position and results of operations.

Contracting with government entities exposes us to additional risks inherent in the government procurement process.

We provide ~~products, services and~~ solutions, directly and indirectly, to a variety of domestic and foreign government entities, which introduces certain risks and challenges not present in private commercial agreements, including varying governmental budgeting processes,; changes in governmental administrations and policies; fluctuations due to government spending cuts and shutdowns,; and highly competitive and lengthy bidding process that may be subject to political influence. ~~and~~Additionally, ~~adherence~~we are subject to complex regulatory requirements and executive orders, including those related to procurement; ~~regulations~~export controls; employment; security; and other evolving government-specific contractual requirements. We incur significant up-front time and costs without any assurance that we will win a contract. Operating within a highly regulated industry, we have been and may in the future be subject to audits and investigations relating to our government contracts and any violations could result in termination of contracts and various civil and criminal penalties and administrative sanctions, including payment of fines and suspension or debarment from future government business, as well as harm to our reputation and financial results. We have made, and may continue to make, significant investments to support future sales opportunities in various government sectors, including to obtain various security authorizations and certifications. Such processes are complex, lengthy and can often be delayed. Furthermore, requirements may change, or we may be unable to achieve or sustain one or more government authorizations or certifications, which could affect our ability to sell to government entities until we meet any new or revised requirements.

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continue to make, significant investments to support future sales opportunities in various government sectors, including to obtain various security authorizations and certifications. Such processes are complex, lengthy and can often be delayed. Furthermore, requirements may change, or we may be unable to achieve or sustain one or more government authorizations or certifications, which could affect our ability to sell to government entities until we meet any new or revised requirements.

Risks Related to Financial Performance

If there is a change in subscriptions or renewals in a reporting period, this could cause our financial results to suffer and may not be immediately reflected in our revenue and financial results for that period because we recognize revenue over the subscription term.

Our ~~offerings~~solutions are typically subscription-based, pursuant to product and service agreements. We generally recognize revenue from our subscription ~~offerings~~solutions ratably over the terms of their subscription agreements, which typically range from 1 to 36 months. As a result, most of the subscription revenue we report each quarter is the result of subscription agreements entered into during previous quarters. Lower sales and subscriptions, reduced demand for our ~~products, services and~~ solutions, and increases in our attrition rate in any given period may not be fully reflected in our results of operations until future periods. Our subscription model could also make it difficult for us to rapidly increase our revenue from subscription-based or hosted services through additional sales in any period, as revenue from new customers will be recognized over the applicable subscription term. Our renewal rates may decline or fluctuate as a result of a number of factors, including our customers’ level of satisfaction, our ability to continue enhancing features and functionality, reliability of our ~~offerings~~solutions, prices of ours and competitors’ ~~offerings~~solutions, the actual or perceived information security of our systems and services, decreases in the size of our customer base, changes as a result of regulatory or legal requirements, changes in the composition of our customer base and reductions in our customers’ spending levels or declines in customer activity. If our customers do not renew their subscriptions or if they renew on terms less favorable to us, our revenue may decline. Further, such impact on our revenue may not be immediately reflected in our financial results in the period in which our renewal rates changed and may adversely affect our financial results in future periods. If any of our assumptions about revenue from our subscription-based ~~offerings~~solutions prove incorrect, our actual results may suffer and vary from those anticipated.

We are subject to fluctuations in foreign currency exchange rates and may not be able to effectively hedge our exposure.

Our ~~operating~~financial results and performance metrics are subject to fluctuations in foreign currency exchange rates due to the global scope of our business. Geopolitical and economic events, including war, trade disputes, tariffs, economic sanctions and emerging market volatility, and associated uncertainty have caused, and may in the future cause, currencies to fluctuate. Accordingly, amounts reported as annualized recurring revenue, a performance metric which we measure at currency rates that are set at the beginning of each fiscal year and held constant throughout the year, may vary from actual revenue recognized in accordance with generally accepted accounting principles in the United States.

We attempt to mitigate a portion of these foreign currency exchange risks to our ~~operating~~financial results through foreign currency hedging based on our judgment of the appropriate trade-offs among risk, opportunity and expense. We regularly review our hedging program and make adjustments that we believe are appropriate. Our hedging activities have not, and may not in the future, offset more than a portion of the adverse financial impact, including on our actual revenue recognized, resulting from unfavorable movement in foreign currency exchange rates, which could adversely affect our financial condition, business performance or results of operations.

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If our goodwill or intangible assets become impaired, then we could be required to record a significant charge to earnings.

We test goodwill for impairment at least annually. We review our goodwill and intangible assets for impairment when events or changes in circumstances indicate the carrying value may not be recoverable, including declines in stock price, market capitalization or reduced future cash flow estimates and slower growth rates in our industry. Depending on the results of our review, we may be required to record a significant charge to earnings in our consolidated financial statements during the period in which any impairment of our goodwill or intangible assets was determined, negatively impacting our results of operations.

Our existing and future debt obligations may adversely affect our financial condition and future financial results.

As of November 2928, ~~2024~~2025, we had $56.6515 billion in senior unsecured notes outstanding and a $3 billion commercial paper program with no amounts outstanding. We also had a $1.5 billion senior unsecured revolving credit agreement, which was undrawn. This debt or future additional indebtedness may adversely affect our financial condition and future financial results by, among other things:

•requiring the dedication of a portion of our expected cash flows from operations to service our debt, thereby reducing the amount of expected cash flows available for other purposes, including capital expenditures and acquisitions;

•increasing our vulnerability to adverse changes in our business and general economic and industry conditions; and

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•limiting our ability to obtain future financing for working capital, capital expenditures, future acquisitions, general corporate or other purposes, which may also impact our ability to service and repay outstanding indebtedness as it becomes due.

Our senior unsecured notes, commercial paper program and revolving credit agreement impose restrictions on us and require us to maintain compliance with specified covenants. Our ability to comply with these covenants may be affected by events beyond our control. If we breach any of the covenants and do not obtain a waiver from the noteholders or lenders, then, subject to applicable cure periods, any outstanding debt may be declared immediately due and payable.

In addition, changes by any rating agency to our credit rating may negatively impact the value and liquidity of both our debt and equity securities, as well as the potential costs associated with a refinancing of our debt. Under certain circumstances, if our credit ratings are downgraded or other negative action is taken, the interest rate payable by us under our revolving credit agreement could increase. Downgrades in our credit ratings could also restrict our ability to obtain additional financing in the future and affect the terms of any such financing.

General Risk Factors

Catastrophic events, including events associated with climate change, may disrupt our business and adversely affect our financial condition and results of operations.

Our business relies on our network infrastructure and enterprise ~~Apps~~apps, internal technology systems and websites. A disruption, infiltration or failure of our systems, data centers or operations, or those of our third-party service providers due to a major earthquake, other natural disasters, including climate-related events (such as ~~drought~~flooding, water ~~security~~stress, heat waves, ~~cold~~cyclones ~~waves, wildfires~~ and ~~poor air quality~~wildfires), power shutoff or loss, telecommunications failure, cloud service provider outages, epidemic, pandemic, war, terrorist attack or other catastrophic event, could cause interruptions to our systems, solutions and business operations, damage to critical infrastructure, loss of intellectual property, data security breaches and data loss. Our corporate headquarters, significant research and development activity, certain of our data centers and other critical business operations are in the San Francisco Bay Area and the Salt Lake Valley Area, both of which are near major earthquake faults. ~~Climate~~Exposure to climate-related ~~catastrophic~~ events that may harm our business ~~are~~may ~~also~~continue ~~increasing~~to increase in ~~frequency and severity~~intensity. A catastrophic event, particularly one that may disrupt our data centers or our critical activities, could prevent us from conducting normal business operations and providing our ~~products, services and~~ solutions, which could adversely affect our business. A catastrophic event could negatively impact a country or region in which we sell and, in turn, decrease demand for our ~~products, services and~~ solutions, which could negatively impact our business.

~~Laws,~~Our ~~regulations~~stock ~~and~~price ~~policies~~has ~~relating~~been tovolatile ~~environmental, social,~~ and ~~governance~~your ~~are~~investment ~~expanding~~could ~~globally.~~lose We may be subject to additional climate-related regulations and reporting requirements in the future, as well as changing market dynamics and stakeholder expectations regarding climate change and our environmental impactsvalue. Compliance with such regulations, investments in our environmental, social and governance commitments, may involve significant costs and negatively impact our business, financial condition and results of operations. Additionally, we may experience reputational harm from our actual or perceived failure to meet our environmental, social and governance commitments.

33Our stock price has been, and may continue to be, volatile and subject to fluctuations. All factors described in this Part I, Item 1A of this report, some of which are beyond our control, may affect our stock price, including:

~~Table~~•shortfalls ofor ~~Contents~~declines in our results or shortfalls, changes to estimates, recommendations or expectations in guidance we provide or provided by financial analysts about our revenue, margins, earnings, annualized recurring revenue, growth rates or other key performance metrics;

~~The~~•changes ~~occurrence of an epidemic or a pandemic, such as the COVID-19 pandemic, has had, and may in the future, have an adverse effect on our operating results. The extent~~ to ~~which epidemics and pandemics impact~~ our ~~financial~~key ~~condition~~performance or results of operations will depend on many factors outside of our control and whether there is a material impact on the businesses or productivity of our customers, employees, suppliers and other partners. A global pandemic may also intensify the other risks described in this Part I, Item 1A of this report.metrics;

Our stock price may be volatile and your investment could lose value.

Our stock price has been and may continue to be volatile and subject to fluctuations. All factors described in this Part I, Item 1A of this report, some of which are beyond our control, may affect our stock price, including:

•shortfalls in our results or shortfalls, changes to estimates, recommendations or expectations in guidance we provide or provided by financial analysts about our revenue, margins, earnings, annualized recurring revenue, growth rates or other key performance metrics;

•changes in investor and analyst valuation models for our stock;

•changes in annualized recurring revenue, unearned revenue, remaining performance obligations and revenue recognized at a point in time, all of which may impact actual or implied growth rates;

•developments related to products or services, technological advancements, strategic alliances, acquisitions or significant transactions by us or our competitors;

•changes in the amounts or frequency of stock repurchases;

•the loss of large customers or our inability to retain or increase sales to existing customers or attract new customers;

•changes to our management team, including recruitment or departure of key personnel;

•variations in our or our competitors’ ~~results~~financial ofand ~~operations~~business performance, changes in the competitive landscape generally and developments in our industry;

•~~general~~adverse economic, political or market conditions; and

~~•other events, such as significant litigation and regulatory actions and media and social media scrutiny.~~28

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•other events, such as significant litigation, regulatory investigations or actions, and negative media or social media coverage.

In addition, the market for technology stocks or the stock market in general has experienced, and may in the future experience, extreme fluctuations, which has caused, and may in the future cause, our stock price to decline for reasons unrelated to our financial performance. Volatility in our stock price has increased, and may continue to increase, our susceptibility to securities class action litigation, which could result in substantial costs and divert management’s attention and resources, which may adversely affect our business.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

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ITEM 1C. CYBERSECURITY

Risk Management and Strategy

Adobe has certain security processes, infrastructure, systems, policies and practices for assessing, identifying and managing risks from cybersecurity threats. We maintain an information security risk management framework for managing cybersecurity risks, priorities and projects for our products, services, infrastructure and corporate resources. As part of our framework, a cybersecurity risk steering committee meets regularly to review newly identified risks and progress on remediating existing risks.

We conduct regular security reviews, simulations and testing, including internal and external penetration testing, vulnerability assessments and regular scans on our hosts and network devices. We review available threat intelligence, including information from industry groups and our security vendor. We consult with third parties, including cybersecurity consultants, as part of our cybersecurity threat and risk management strategy.

Depending on the environment, our risk mitigation strategies include a variety of technical, physical and operational measures designed to manage and mitigate material risks from cybersecurity threats to our systems and data. We require employees annually to complete a general security awareness training, and additional engineering and security specific training may also be required for certain positions. Further, we maintain a vendor security review program, which is designed to provide an assessment of the security practices of those third-party vendors that process Adobe non-public data or connect to our networks. We maintain an information security incident response plan designed to monitor, analyze, address, escalate and report cybersecurity incidents, and escalate certain cybersecurity incidents to members of management depending on the circumstances, including our Chief Security Officer (“CSO”), Chief Cybersecurity Legal and Privacy Officer (“CCPO”), Chief Financial Officer, Chief People Officer, President of Digital Media, President of Digital Experience, General Counsel and Chief Executive Officer.

For a description of the risks from cybersecurity threats that may materially affect us, see the risks described in the section titled “Risk Factors” contained in Part I, Item IA of this report, including under the headings “Security incidents, improper access to or disclosure of our customers’ data or other cybersecurity incidents may harm our reputation and materially and adversely affect our business.”

Governance

Our Board of Directors (the “Board”) addresses cybersecurity ~~risk~~risks ~~management~~ as part of its general oversight function. ~~The~~Our Audit Committee of the Board (the “Audit Committee”) ~~has~~oversees ~~oversight of~~ enterprise risks, including ~~risks related to~~ cybersecurity. ~~In this regard~~risks, ~~the Audit Committee reviews~~ and ~~discusses with management~~ the adequacy and effectiveness of our information security, technology and ~~privacy~~ policies and ~~the~~our internal controls regarding these areas. ~~Our~~The Audit Committee receives regular cybersecurity updates ~~about~~from ~~general~~our ~~cybersecurity~~Chief ~~risks~~Security ~~from~~Officer ~~our~~ (“CSO”), ~~and~~in ~~updates~~conjunction ~~about~~with ~~the~~senior ~~prevention,~~cyber ~~detection,~~legal ~~mitigation~~ and ~~remediation~~other ofprofessionals, ~~cybersecurity~~and ~~incidents~~reports ~~from~~those ~~our~~updates ~~CSO~~to ~~and~~the ~~CCPO~~Board. ~~Cybersecurity~~The updates ~~presented~~address totopics ~~the~~such ~~Audit~~as ~~Committee~~cybersecurity ~~are~~risks ~~reported~~and to the ~~Board~~prevention, bydetection, ~~the~~mitigation ~~Audit~~and ~~Committee~~remediation ~~Chair~~of cybersecurity incidents. We ~~also~~ have a Cyber Disclosure Committee, comprised of our CSO, cyber legal professionals and other cross-functional leaders ~~including finance~~, ~~risk,~~that ~~operations~~meets ~~and~~regularly ~~investor~~to ~~relations~~assess and ~~led~~make bydeterminations ~~the~~regarding ~~CSO~~certain ~~and~~cybersecurity ~~CCPO~~incidents, ~~that~~and ~~meets~~have toan ~~assess~~escalation ~~certain~~process ~~incidents~~to inform management and ~~makes~~the ~~determinations~~Audit ~~regarding~~Committee ~~materiality~~when appropriate. Additionally, our CSO ~~and~~identifies ~~CCPO identify~~ certain cybersecurity risks that are reviewed as part of the enterprise risk management framework and periodically presented to the Board and the Audit Committee ~~on an annual basis~~.

Our cybersecurity risk assessment and management processes are implemented and maintained by ~~certain~~ management ~~members~~, including our CSO and ~~CCPO~~our cyber legal professionals, whom each has extensive cybersecurity experience in their respective areas of responsibility and expertise. Our CSO, who reports to the Chief Financial Officer, has primary responsibility for ~~hiring~~the ~~appropriate~~strategy, ~~information~~engineering ~~security personnel~~ and ~~managing~~operations ~~workloads~~ of ~~information security personnel, engaging and overseeing third-party~~ cybersecurity ~~consultants,~~across approving budgets and cybersecurity processes, preparing for incident response, reviewing security assessments and other security-related reports, communicating key priorities to relevant personnel, including the security incident response team, assessing and managing Adobe’s ~~overall cybersecurity strategy, standards, risk management (~~in ~~consultation~~partnership with ~~the~~our ~~cybersecurity~~executive-level ~~risk~~product ~~steering~~leaders ~~committee)~~ and ~~processes.~~our ~~Our~~cyber ~~CCPO~~legal professionals, who ~~reports~~report to the ~~General~~Chief ~~Counsel~~Legal Officer, ~~has~~and have primary responsibility for the legal aspects of ~~the~~ cybersecurity ~~program,~~across ~~including assessing and providing advice on our cybersecurity strategy, standards, risk management, policies, processes and legal obligations~~Adobe. Our CSO ~~and~~is ~~CCPO are~~ supported by a ~~cybersecurity~~ team ~~comprised~~ of cybersecurity, information security, information technology, operations and legal executives and professionals.

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ITEM 2. PROPERTIES

Our corporate headquarters is located in San Jose, California where we occupy approximately 1.7 million square feet of office space. We own all of our San Jose, California properties which we use for research, product development, sales, marketing and administrative purposes. We own and lease properties in various locations throughout the United States which we also use for research, product development, sales, marketing and administrative purposes, and data centers.

Outside of the United States, we own and lease properties throughout Europe, Middle East and Africa (“EMEA”) and Asia-Pacific (“APAC”) for research, product development, sales, marketing and administrative purposes. The largest properties we occupy outside of the United States are our Bangalore, India and Noida, India offices which are approximately 0.7 million and 0.57 million square feet, respectively. We own and lease these properties in India.

We operate under a hybrid work model and believe our existing facilities, both owned and leased, are in good operating condition and suitable for the conduct of our business.

See Note 187 of our Notes to Consolidated Financial Statements for further information regarding our lease obligations.

ITEM 3. LEGAL PROCEEDINGS

The material set forth in the section titled “Legal Proceedings” in Note 16 of our Notes to Consolidated Financial Statements is incorporated herein by reference.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information for Common Stock

Our common stock is traded on the Nasdaq Global Select Market under the symbol “ADBE.”

Stockholders

According to the records of our transfer agent, there were ~~856~~801 holders of record of our common stock on January 39, ~~2025~~2026. Because many of such shares are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of stockholders represented by these record holders.

Dividends

We do not anticipate paying any cash dividends in the foreseeable future.

Issuer Purchases of Equity Securities

Below is a summary of stock repurchases for the three months ended November 2928, ~~2024~~2025. See Note 14 of our Notes to Consolidated Financial Statements for information regarding our stock repurchase programs.

Period	Total Number of Shares Repurchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans	Approximate Dollar Value that May Yet be Purchased Under the Plans (1)
	(in millions, except average price per share)
Beginning repurchase authority					$	20,150
August 30—September 26, 2025	2.1	$	353.68	2.1	$	8,088
August 31—September 27, 2024
September 27—October 24, 2025	2.3	$	345.96	2.3	$	7,307
Accelerated share repurchases (2),(3)	4.6	$	—	4.6	$	(2,500)	(3)
October 25—November 28, 2025	2.8	$	332.31	2.8	$	6,369
September 28—October 25, 2024
Total	7.2			7.2
Shares repurchased	—	$	—	—	$	—
October 26—November 29, 2024
Shares repurchased	—	$	—	—	$	—
Total	4.6			4.6	$	17,650

_________________________________________

(1)In March 2024, our Board of Directors granted authority to repurchase up to $25 billion in our common stock through March 14, 2028.

(2)In June 2024, we entered into an accelerated share repurchase agreement (“ASR”) with a large financial institution whereupon we provided them with a prepayment of $2.5 billion and received an initial delivery of shares at contract inception representing a portion of the prepayment. Upon final settlement of this ASR in September 2024, we received an incremental delivery of 1.0 million shares of our common stock. Under this ASR, we repurchased a total of 4.6 million shares at an average price of $546.30.

(3)In September 2024, we entered into an ASR with a large financial institution whereupon we provided them with a prepayment of $2.5 billion and received an initial delivery of 3.6 million shares of our common stock at contract inception, representing a portion of the prepayment. Subsequent to November 29, 2024, this ASR was settled which resulted in total repurchases of 5.0 million shares at an average price of $501.37.

ITEM 6. [RESERVED]

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our Consolidated Financial Statements and Notes thereto. Discussion regarding our financial condition and results of operations for fiscal ~~2023~~2024 as compared to fiscal ~~2022~~2023 is included in Item 7 of our Annual Report on Form 10-K for the fiscal year ended ~~December~~November 129, ~~2023~~2024, filed with the SEC on January 1713, ~~2024~~2025.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

In preparing our Consolidated Financial Statements in accordance with generally accepted accounting principles in the United States (“GAAP”) and pursuant to the rules and regulations of the SEC, we make assumptions, judgments and estimates that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosures of contingent assets and liabilities. We base our assumptions, judgments and estimates on historical experience and various other factors that we believe to be reasonable under the circumstances. Actual results could differ materially from these estimates under different assumptions or conditions. We evaluate our assumptions, judgments and estimates on a regular basis. We also discuss our critical accounting policies and estimates with the Audit Committee of the Board of Directors.

We believe that the assumptions, judgments and estimates involved in the accounting for revenue recognition and income taxes have the greatest potential impact on our Consolidated Financial Statements. These areas are key components of our results of operations and are based on complex rules requiring us to make judgments and estimates, and consequently, we consider these to be our critical accounting policies. Historically, our assumptions, judgments and estimates relative to our critical accounting policies have not differed materially from actual results.

Revenue Recognition

Our contracts with customers may include ~~multiple~~promises ~~goods~~to ~~and~~transfer ~~services.~~multiple ~~For~~products ~~example, some of our offerings include both on-premise~~ and~~/or~~ ~~on-device software licenses and cloud~~ services. Determining whether ~~the~~products ~~software licenses~~ and ~~the cloud~~ services are distinct ~~from each other, and therefore~~ performance obligations to be accounted for separately, or ~~not~~combined ~~distinct~~as ~~from each other, and therefore~~ part of a single performance obligation, may require significant judgment., Weprimarily ~~have~~for ~~concluded~~our solutions that ~~the~~include both on-premise and/or on-device software licenses and cloud services. ~~provided~~We inhave ~~our~~concluded ~~Creative~~that ~~Cloud~~certain ~~and Document Cloud~~ subscription offerings, ~~are~~which ~~not~~include ~~distinct~~both ~~from~~on-premise/on-device ~~each~~software ~~other~~licenses ~~such~~and ~~that~~cloud ~~revenue~~services, ~~from~~represent ~~each~~a ~~offering~~single, ~~should~~highly beintegrated ~~recognized~~performance ~~ratably~~obligation. ~~over~~This conclusion reflects the ~~subscription~~high ~~period~~degree ~~for~~of ~~which~~integration, interdependency and interrelation between the software and the cloud services, ~~are~~such ~~provided.~~that Incustomers ~~reaching~~receive ~~this~~the ~~conclusion,~~intended webenefit ~~considered~~only ~~the~~when these components operate together. The nature of our promise to ~~Creative Cloud and Document Cloud~~ customers, ~~which~~ is to ~~provide~~deliver a complete end-to-end ~~creative design or document workflow~~ solution, ~~that~~and ~~operates~~the ~~seamlessly~~intended ~~across~~functionality ~~multiple devices~~ and ~~teams.~~workflow Weefficiencies ~~fulfill~~cannot ~~this~~be ~~promise~~obtained byfrom ~~providing~~either ~~access~~the tosoftware aor ~~solution~~the ~~that integrates~~ cloud~~-based~~ ~~and~~services on~~-premise/on-device~~ ~~features~~a ~~that,~~standalone ~~together~~basis. ~~through their integration~~Accordingly, ~~provide~~revenue ~~functionalities,~~for ~~utility~~these ~~and~~offerings ~~workflow~~is ~~efficiencies~~recognized ~~that~~ratably ~~could~~over ~~not~~the besubscription ~~obtained~~period ~~from~~during ~~either~~which the ~~on-premise/on-device software or~~ cloud services onare ~~their own~~provided.

Cloud-based features that are integral to our Creative Cloud and Document Cloud offerings and that work together with the on-premise/on-device software include, but are not limited to: Creative Cloud Libraries, which enable customers to access their work, settings, preferences and other assets seamlessly across desktop and mobile devices and collaborate across teams in real time; shared reviews which enable simultaneous editing and commenting of digital assets across desktop, mobile and web; automatic cloud rendering of a design which enables it to be worked on in multiple mediums; and Sensei, Adobe’s cloud-hosted artificial intelligence and machine learning framework, which enables features such as automated photo-editing, photograph content-awareness, natural language processing, optical character recognition and automated document tagging.

Accounting for Income Taxes

We use the asset and liability method of accounting for income taxes. Under this method, income tax expense is recognized for the amount of taxes payable or refundable for the current year. In addition, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for tax loss and credit carryforwards. Significant judgment is required in determining our current provision for income taxes and deferred tax assets or liabilities. We record a valuation allowance to reduce deferred tax assets to an amount for which realization is more likely than not.

Our assumptions, judgments and estimates relative to the current provision for income taxes take into account our interpretation and application of current tax laws and possible outcomes of current and future examinations conducted by domestic and foreign tax authorities. We have established reserves for income taxes to address potential exposures involving tax positions that could be challenged by tax authorities. We regularly assess the likelihood of outcomes resulting from these examinations to determine the adequacy of our provision for income taxes and associated reserves. To the extent that the final determination of any of these examinations is different from the amounts recorded, such differences will affect the provision for income taxes and the effective tax rate in the period in which such determination is made.

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determination of any of these examinations is different from the amounts recorded, such differences will affect the provision for income taxes and the effective tax rate in the period in which such determination is made.

Recent Accounting Pronouncements

See Note 1 of our Notes to Consolidated Financial Statements for information regarding recent accounting pronouncements that are of significance or potential significance to us.

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RESULTS OF OPERATIONS

Overview of ~~2024~~Fiscal 2025

For our fiscal ~~2024~~2025, we experienced strong demand across our Digital Media and Digital Experience offerings, driven by ~~our~~transformative ~~innovative~~and customer-focused product ~~roadmap~~innovation. As we execute on our long-term growth initiatives, with ~~focus~~emphasis on delivering ~~product~~value ~~innovation~~through AI-powered and ~~driving~~highly ~~adoption~~differentiated ~~and~~solutions ~~usage~~to meet the needs of our ~~AI-powered~~diverse ~~solutions~~and expanding customer base, we have continued to experience growth in software-based subscription revenue across our portfolio of offerings.

Digital Media

InOur ~~our~~ Digital Media ~~segment~~products, weservices ~~are~~and asolutions ~~market~~help ~~leader~~users ~~with~~create, ~~Creative~~design ~~Cloud~~and publish rich content and 3D experiences, ~~our~~and ~~subscription-based~~improve ~~offering~~productivity ~~which~~by ~~provides~~transforming ~~desktop~~how ~~tools~~they view, ~~mobile~~share and collaborate on documents and content. These offerings include our Creative Cloud flagship applications (“apps”) ~~and~~such ~~cloud-based~~as ~~services~~Adobe ~~for~~Photoshop, ~~designing~~Adobe Illustrator, ~~creating~~Adobe ~~and~~Lightroom, ~~publishing~~Adobe ~~rich~~Premiere ~~content~~Pro and ~~immersive~~Adobe 3DAfter ~~experiences.~~Effects; ~~Creative~~as ~~Cloud~~well ~~offers~~as Adobe Acrobat ~~Pro~~, ~~our~~Adobe ~~comprehensive PDF solution~~Express, ~~integral~~Adobe toFirefly ~~creative workflows~~ and ~~used~~many bymore ~~creators~~products, ~~worldwide~~which asare ~~part~~available ofacross ~~our~~surfaces ~~Creative~~and ~~Cloud~~platforms ~~All~~as ~~Apps~~desktop ~~subscription~~tools, web and onmobile aapps ~~standalone~~and ~~basis~~cloud-based services. ~~In addition,~~ Adobe Express is our web and mobile app designed to enable a broad spectrum of users, including novice content creators, ~~communicators~~ and ~~creative professionals~~communicators, to create, edit and customize content quickly and easily with content- first, task-based solutions. ~~Creative~~Our ~~Cloud~~Adobe ~~also~~Acrobat ~~includes~~offerings ~~Adobe~~fuel ~~Firefly~~document productivity, aenabling ~~group~~users ofto ~~creative~~create, ~~generative~~collaborate, AIreview, ~~models~~approve, ~~designed~~sign toand ~~generate~~track ~~high~~documents ~~quality~~at ~~images~~home, in the office and ~~text~~across ~~effects~~devices. AI innovation is deeply infused into our Digital Media solutions, including through Adobe Firefly-powered generative AI features ~~are also~~ available across our Creative Cloud flagship apps, ~~including Adobe Photoshop~~ and ~~Adobe~~through ~~Express.~~Acrobat ~~Creative~~AI ~~Cloud~~Assistant, ~~delivers~~a ~~value~~generative ~~with deep, cross~~AI-~~product~~powered ~~integration,~~conversational ~~frequent~~interface ~~product~~designed ~~updates~~to ~~and~~enhance ~~feature~~document ~~enhancements,~~experiences. ~~cloud-enabled~~In ~~services~~August ~~including~~2025, ~~storage~~we ~~and~~released ~~syncing~~Acrobat ofStudio, ~~files~~which ~~across~~brings ~~users’~~together ~~devices~~Adobe Acrobat, ~~machine~~Adobe ~~learning~~Express and ~~artificial~~AI ~~intelligence,~~agents ~~access~~ to ~~marketplace,~~further ~~social~~unite productivity and ~~community-based~~creativity, ~~features~~empowering ~~with~~users ~~our~~to ~~Adobe~~quickly ~~Stock~~derive ~~and~~insights ~~Behance~~from ~~services,~~their ~~app~~documents ~~creation~~and ~~capabilities,~~create ~~tools~~visually ~~which~~compelling ~~assist~~content. ~~with~~Our ~~enterprise~~Digital ~~deployments~~Media ~~and~~customers ~~team~~include ~~collaboration~~business professionals, ~~and~~consumers, ~~affordable~~creative ~~pricing~~professionals, ~~for~~creators ~~cost-sensitive~~and ~~customers~~marketing professionals.

WeDuring ~~offer~~fiscal ~~Creative Cloud for individuals~~2025, ~~students,~~Annualized ~~teams~~Recurring ~~and~~Revenue ~~enterprises.~~(“ARR”) Wewas ~~expect~~the ~~Creative~~key ~~Cloud~~performance ~~will~~metric ~~drive sustained long-term revenue growth through a continued expansion of~~ our ~~customer~~management ~~base~~used ~~by attracting new users with new features and products like Adobe Express and Adobe Firefly that make creative tools accessible~~ to ~~first-time~~assess ~~creators~~the ~~and~~health ~~communicators,~~ and ~~delivering~~trajectory ~~new~~of ~~features and technologies to existing customers with~~ our ~~latest~~overall ~~releases~~Digital ~~such~~Media ~~as generative AI capabilities~~segment. WeDigital ~~have~~Media ~~also~~ARR ~~built~~was ~~out~~calculated aas ~~marketplace~~the ~~for~~sum ~~Creative~~of ~~Cloud subscribers to enable~~ the ~~delivery~~annual ~~and~~value ~~purchase~~ of ~~stock~~Digital ~~content~~Media insubscriptions ~~our~~and ~~Adobe~~services ~~Stock service. Overall, our strategy with Creative Cloud is designed to enable us to increase our revenue with existing users, continue to attract new customers,~~ and ~~grow~~the ~~our~~annual ~~recurring~~value ~~and~~of ~~predictable~~Digital ~~revenue~~Media ~~stream~~Enterprise ~~that~~Term isLicense ~~recognized ratably~~Agreements.

WeDigital ~~continue~~Media toARR ~~implement~~grew ~~strategies that are designed~~ to ~~accelerate awareness, consideration and purchase of subscriptions to our Creative Cloud offerings~~$19.20 ~~These~~billion ~~strategies~~at ~~include increasing~~ the ~~value~~end ~~Creative~~of ~~Cloud~~fiscal ~~users receive~~2025, ~~such~~representing as11.5% ~~offering~~year-over-year ~~new~~growth. ~~and~~Our ~~enhanced~~success ~~desktop,~~in ~~web~~driving ~~and~~growth ~~mobile~~in ~~apps,~~ARR ashas ~~well~~positively asaffected ~~targeted~~our ~~promotions~~revenue ~~and~~growth. ~~offers~~Digital ~~that~~Media ~~attract~~segment ~~past~~revenue ~~customers~~grew ~~and potential users~~ to ~~experience and ultimately subscribe to Creative Cloud~~$17.65 ~~Because~~billion ofin ~~the~~fiscal ~~shift towards Creative Cloud subscriptions and Enterprise Term License Agreements (“ETLAs”)~~2025, ~~revenue~~up from ~~perpetual~~$15.86 ~~licensing~~billion ofin ~~our~~fiscal ~~Creative~~2024, ~~products~~representing ~~has~~11% ~~been~~year-over-year ~~immaterial to our business~~growth.

We are also a market leader with our Document Cloud offerings built around our Adobe Acrobat family of products, with a set of integrated mobile apps and cloud-based document services which enable users to create, collaborate, review, approve, sign and track documents regardless of platform or application source type. Document Cloud, which enhances the way people manage critical documents at home, in the office and across devices, includes subscriptions to Adobe Acrobat Pro and Standard, Adobe Acrobat Sign and Adobe Scan. Certain Adobe Acrobat products are also offered as perpetual licenses which are immaterial to our business. In April 2024, we introduced Acrobat AI Assistant, a generative AI-powered product designed to deliver insights and enhance productivity through interactive document experiences, which is available as an add-on subscription to our Adobe Acrobat Pro and Standard and Adobe Acrobat Reader products.

As part of our Creative Cloud and Document Cloud strategies, we utilize a data-driven operating model (“DDOM”) and our Adobe Experience Cloud solutions to raise awareness of our products, drive new customer acquisition, engagement and retention, and optimize customer journeys, which continue to contribute strong product-led growth in the business.

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Annualized Recurring Revenue (“ARR”) is currently the key performance metric our management uses to assess the health and trajectory of our overall Digital Media segment. ARR should be viewed independently of revenue, deferred revenue and remaining performance obligations as ARR is a performance metric and is not intended to be combined with any of these items. We adjust our reported ARR on an annual basis to reflect any exchange rate changes. Our reported ARR results in the current fiscal year are based on currency rates set at the beginning of the year and held constant throughout the year for measurement purposes. We calculate ARR as follows:

Creative ARR Annual Value of Creative Cloud Subscriptions and Services+ Annual Creative ETLA Contract Value Document Cloud ARR Annual Value of Document Cloud Subscriptions and Services +Annual Document Cloud ETLA Contract Value Digital Media ARR Creative ARR+ Document Cloud ARR

Creative ARR exiting fiscal 2024 was $13.85 billion, up from $12.49 billion at the end of fiscal 2023. Document Cloud ARR exiting fiscal 2024 was $3.48 billion, up from $2.84 billion at the end of fiscal 2023. Total Digital Media ARR grew to $17.33 billion at the end of fiscal 2024, up from $15.33 billion at the end of fiscal 2023. Revaluing our ending ARR for fiscal 2024 using currency rates determined at the beginning of fiscal 2025, our Digital Media ARR at the end of fiscal 2024 would be $17.22 billion or approximately $117 million lower than the ARR reported above.

Our success in driving growth in ARR has positively affected our revenue growth. Creative revenue in fiscal 2024 was $12.68 billion, up from $11.52 billion in fiscal 2023, representing 10% year-over-year growth. Document Cloud revenue in fiscal 2024 was $3.18 billion, up from $2.70 billion in fiscal 2023, representing 18% year-over-year growth. Total Digital Media segment revenue grew to $15.86 billion in fiscal 2024, up from $14.22 billion in fiscal 2023, representing 12% year-over-year growth.

Digital Experience

WeOur Digital Experience apps and services are adesigned ~~market~~to ~~leader~~accelerate incustomer ~~the~~experience ~~fast-growing~~orchestration ~~category~~at ~~addressed~~scale byand ~~our~~supply intelligence for businesses of any size in any industry. Digital Experience ~~segment.~~is ~~The~~comprised ~~Adobe~~of ~~Experience~~solutions ~~Cloud~~to ~~apps~~deliver actionable data, with products such as Adobe Analytics and ~~services~~Adobe ~~are~~Real-Time ~~designed~~Customer toData ~~manage~~Platform; ~~customer~~optimize ~~journeys~~personalized content delivery, ~~enable~~with ~~personalized~~products ~~experiences~~such atas ~~scale~~Adobe Experience Manager, Adobe Commerce and ~~deliver~~Adobe ~~intelligence~~GenStudio for ~~businesses~~Performance ofMarketing; ~~any~~and ~~size~~manage incustomer ~~any~~journeys, ~~industry~~with products such as Adobe Marketo Engage and Adobe Campaign. Our differentiation and competitive advantage are strengthened by our ability to use the Adobe Experience Platform to integrate our comprehensive set of solutions and our ability to embed AI into our product portfolio, such as with our ~~new~~ Adobe Experience Platform AI Assistant, a generative AI-powered conversational interface designed to help customers automate workflows and generate new audiences and journeys. Our Digital Experience customers include marketing professionals such as brand managers, channel marketers and campaign strategists.

~~Adobe~~Digital Experience ~~Cloud~~revenue ~~delivers~~was ~~solutions~~$5.86 ~~for~~billion ~~our~~in ~~customers~~fiscal ~~across~~2025, ~~the~~up ~~following~~from ~~strategic~~$5.37 billion in fiscal 2024, representing 9% year-over-year growth. ~~pillars:~~Subscription revenue grew to $5.41 billion in fiscal 2025, up from $4.86 billion in fiscal 2024, representing 11% year-over-year growth.

~~•Data insights and audiences. Our products deliver actionable data to our customers in real time to enable highly tailored and adaptive experiences across platforms through Adobe Analytics, Adobe~~ Customer ~~Journey Analytics, Adobe Product Analytics, Adobe Mix Modeler, and Adobe Real~~-~~time~~Focused ~~Customer Data Platform.~~Strategy

~~•Content, commerce and workflows.~~ Our ~~products help our~~ customers ~~manage,~~often ~~deliver,~~are ~~personalize,~~involved ~~and~~in ~~optimize~~workflows ~~content~~that ~~delivery~~integrate ~~through~~multiple Adobe ~~Experience~~products ~~Manager;~~across ~~build~~both ~~multi-channel~~segments. ~~commerce~~By ~~experiences~~combining ~~for~~the ~~B2B~~creativity ~~and~~of ~~B2C~~our ~~customers~~Digital ~~with~~Media ~~Adobe~~business ~~Commerce;~~with ~~strategically~~the ~~plan,~~science ~~manage,~~of ~~collaborate~~our ~~and~~Digital ~~execute~~Experience onbusiness, ~~workflows~~such ~~for~~as ~~marketing~~with ~~campaigns~~our ~~and~~Adobe ~~other~~GenStudio ~~projects~~solutions, atwe ~~speed~~help ~~and~~our ~~scale~~customers ~~with~~to ~~our~~more ~~enterprise~~efficiently ~~work~~and ~~management~~effectively ~~App~~make, ~~Adobe~~manage, ~~Workfront;~~measure and ~~leverage~~monetize ~~self-serve~~their ~~capabilities to deliver on-brand~~ content ~~powered~~across byevery ~~generative~~channel AIwith inan ~~Adobe~~end-to-end ~~GenStudio for Performance Marketing~~workflow.

•Customer journeys. Our products help businesses manage, test, target and personalize customer journeys delivered as campaigns across B2B and B2C use cases, including through Adobe Marketo Engage, Adobe Campaign, Adobe Target and Adobe Journey Optimizer.33

In addition to chief marketing officers, chief revenue officers and digital marketers, users of our Digital Experience solutions include advertisers, campaign managers, publishers, data analysts, content managers, social marketers, marketing executives and information management and technology executives. These customers often are involved in workflows that integrate other Adobe products, such as our Digital Media offerings. By combining the creativity of our Digital Media business

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~~with~~Spanning ~~the~~both ~~science of~~ our Digital ~~Experience~~Media ~~business,~~and ~~such~~Digital asExperience ~~with our Adobe GenStudio solution~~segments, we ~~help~~drove ~~our~~continued ~~customers~~business tosuccess ~~more~~through ~~efficiently~~audience-specific ~~and~~product ~~effectively~~innovation ~~make, manage, measure~~ and ~~monetize~~go-to-market ~~their~~strategy ~~content~~focused ~~across~~on ~~every~~the ~~channel~~following ~~with~~two ancustomer ~~end-to-end~~groups: ~~workflow and feedback loop.~~

We•Business ~~utilize~~Professionals a& ~~direct~~Consumers ~~sales~~desire ~~force~~web ~~to market~~ and ~~license~~mobile ~~our~~apps ~~Digital~~with ~~Experience~~easy-to-use ~~solutions,~~AI ~~as well as an extensive ecosystem of partners~~capabilities, ~~including marketing agencies, systems integrators~~ and ~~independent~~are ~~software~~increasingly ~~vendors~~benefiting ~~that~~from ~~help~~using ~~license~~Adobe Acrobat and ~~deploy~~Adobe ~~our solutions to their customers~~Express. WeRevenue ~~have~~associated ~~made~~with ~~significant~~the ~~investments~~Business toProfessionals ~~broaden~~& ~~the~~Consumers ~~scale~~customer ~~and~~group ~~size~~consists of ~~all~~Adobe ofAcrobat ~~these~~offerings ~~routes~~and toAdobe ~~market~~Express, ~~and~~all ~~our~~of ~~recent~~which ~~financial~~are ~~results~~part ~~reflect the success~~ of ~~these~~Digital ~~investments and our experience-led growth strategy~~Media.

~~Digital~~•Creative ~~Experience~~& ~~revenue~~Marketing ~~was~~Professionals ~~$5.37~~require ~~billion~~agile inand ~~fiscal~~comprehensive ~~2024,~~solutions upto ~~from~~create ~~$4.89~~high ~~billion~~volumes inof ~~fiscal~~compelling ~~2023~~content, ~~representing~~infused ~~10%~~with ~~year-over-year~~commercially ~~growth.~~safe ~~Subscription~~AI ~~revenue~~capabilities; ~~grew~~and ~~to $4.86~~are ~~billion~~ benefiting from investments in ~~fiscal 2024~~powerful, ~~up from $4~~integrated workflows through offerings such as Adobe Firefly and Adobe GenStudio.33 ~~billion in~~Revenue ~~fiscal 2023~~associated with the Creative & Marketing Professionals customer group consists of Digital Experience offerings as well as Creative Cloud flagship apps such as Photoshop, ~~representing 12% year-over-year~~Lightroom ~~growth~~and Illustrator within Digital Media.

Due to the nature of certain offerings which contain cross-product integrations or benefits, revenue attributable to certain product entitlements may be recognized in either customer group.

By viewing the business through this lens, we can more effectively execute our long-term growth strategies. Our success will be achieved through continued acquisition and retention of our customer base by delivering valuable new features and technologies to customers with our latest releases, including generative AI capabilities to enhance creativity, productivity and marketing, and expanding availability of our offerings across an increasing number of surfaces.

As part of our customer-focused strategy, we utilize a data-driven operating model and tailored go-to-market motion to raise awareness of our products and drive customer acquisition, engagement and retention. Overall, our strategy is designed to increase our revenue with existing users, continue to attract new customers, and grow our recurring and predictable revenue stream that is recognized ratably.

The key performance metric used by management to evaluate progress against our customer-focused strategy is Total Adobe ARR, which represents the annual value of subscription contracts in the Creative & Marketing Professionals and Business Professionals & Consumers customer groups. We adjust our reported ARR on an annual basis, primarily to reflect any exchange rate changes. Our reported ARR results in the current fiscal year are based on currency rates set at the beginning of the year and held constant throughout the year for measurement purposes. Prior year ARR balances are also revalued at the new currency rates for comparative purposes.

Total Adobe ARR grew to $25.20 billion exiting fiscal 2025, representing 11.5% year-over-year growth. Revaluing our ending ARR for fiscal 2025 using currency rates determined at the beginning of fiscal 2026, our Total Adobe ARR at the end of fiscal 2025 would be $25.66 billion, or approximately $460 million higher than the ARR reported above.

Macroeconomic Conditions

As a corporation with an extensive global footprint, we are subject to risks and exposures from the evolving macroeconomic environment, including the effects of increased global inflationary pressures and interest rates, fluctuations in foreign currency exchange rates, potential economic slowdowns or recessions and geopolitical pressures, including the unknown impacts of current and future trade regulations. We continuously monitor the direct and indirect impacts of these circumstances on our business and financial results.

While our revenue and earnings are relatively predictable as a result of our subscription-based business model, the broader implications of these macroeconomic events on our business, results of operations and overall financial position, particularly in the long term, remain uncertain. See the section titled “Risk Factors” in Part I, Item 1A of this report for further discussion of the possible impact of these macroeconomic issues on our business.

~~Financial Performance Summary for Fiscal 2024~~34

•Total Digital Media ARR of approximately $17.33 billion as of November 29, 2024 increased by $2.00 billion, or 13%, from $15.33 billion as of December 1, 2023.

•Creative revenue of $12.68 billion during fiscal 2024 increased by $1.17 billion, or 10%, from $11.52 billion in fiscal 2023. Document Cloud revenue of $3.18 billion during fiscal 2024 increased by $483 million, or 18%, from $2.70 billion in fiscal 2023.

•Digital Experience revenue of $5.37 billion during fiscal 2024 increased by $473 million, or 10%, from $4.89 billion in fiscal 2023.

•Cost of revenue of $2.36 billion during fiscal 2024 remained relatively flat compared to fiscal 2023.

•Operating expenses of $12.41 billion during fiscal 2024 increased by $2.00 billion, or 19%, from $10.41 billion in fiscal 2023 primarily due to the $1 billion Figma termination fee incurred in fiscal 2024.

•Net income of $5.56 billion during fiscal 2024 increased by $132 million, or 2%, from $5.43 billion in fiscal 2023.

•Cash flows from operations of $8.06 billion during fiscal 2024 increased by $754 million, or 10%, from $7.30 billion in fiscal 2023.

•Remaining performance obligations of $19.96 billion as of November 29, 2024 increased by $2.75 billion, or 16%, from $17.22 billion as of December 1, 2023.

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Financial Performance Summary for Fiscal 2025

•Total Adobe ARR of approximately $25.20 billion as of November 28, 2025 increased by 11.5% from $22.61 billion as of November 29, 2024 revalued using currency rates determined at the beginning of fiscal 2025.

•Digital Media ARR of approximately $19.20 billion as of November 28, 2025 increased by 11.5% from $17.22 billion as of November 29, 2024 revalued using currency rates determined at the beginning of fiscal 2025.

•Digital Media revenue of $17.65 billion during fiscal 2025 increased by $1.79 billion, or 11%, compared to fiscal 2024.

•Digital Experience revenue of $5.86 billion during fiscal 2025 increased by $498 million, or 9%, compared to fiscal 2024.

•Cost of revenue of $2.55 billion during fiscal 2025 increased by $193 million, or 8%, compared to fiscal 2024.

•Operating expenses of $12.51 billion during fiscal 2025 remained relatively flat compared to fiscal 2024.

•Net income of $7.13 billion during fiscal 2025 increased by $1.57 billion, or 28%, compared to fiscal 2024.

•Cash flows from operations of $10.03 billion during fiscal 2025 increased by $1.98 billion, or 25%, compared to fiscal 2024. Fiscal 2024 cash flows from operations were adversely impacted by payment of the $1 billion Figma termination fee.

•Remaining performance obligations of $22.52 billion as of November 28, 2025 increased by 13% from $19.96 billion as of November 29, 2024.

Revenue

(dollars in millions)	~~2024~~2025			~~2023~~2024			~~2022~~2023			% ~~Change2024~~Change2025-~~2023~~2024
Subscription	$	2022,~~521~~904		$	1820,~~284~~521		$	1618,~~388~~284		12 %	%
Percentage of total revenue	9596 %		%	9495 %		%	9394 %		%
Product	~~386~~325			~~460~~386			~~532~~460			(16)%	%
Percentage of total revenue	2 %		%	2 %		%	32 %		%
Services and other	~~598~~540			~~665~~598			~~686~~665			(10)%	%
Percentage of total revenue	32 %		%	43 %		%	4 %		%
Total revenue	$	2123,~~505~~769		$	1921,~~409~~505		$	1719,~~606~~409		11 %	%

Subscription

Our subscription revenue is comprised primarily of fees we charge for our subscription and hosted service offerings, and ~~related~~also ~~support,~~includes ~~including~~subscription-based ~~Creative~~consulting ~~Cloud and certain of our Adobe Experience Cloud and Document Cloud~~ services. We primarily recognize subscription revenue ratably over the term of agreements with our customers, beginning with commencement of service. Subscription revenue related to certain offerings, where fees are based on a number of transactions and invoicing is aligned to the pattern of performance, customer benefit and consumption, are recognized on a usage basis.

We have the following reportable segments: Digital Media, Digital Experience, and Publishing and Advertising. Subscription revenue by reportable segment for fiscal 2024, 2023 and 2022 is as follows:

(dollars in millions)	2024		2023		2022		% Change2024-2023
Digital Media	$	15,547	$	13,838	$	12,385	12	%
Digital Experience	4,864		4,331		3,880		12	%
Publishing and Advertising	110		115		123		(4)	%
Total subscription revenue	$	20,521	$	18,284	$	16,388	12	%

Product

Our product revenue is comprised primarily of fees related to licenses for on-premise software purchased on a perpetual basis, for a fixed period of time, or based on usage for certain of our original equipment manufacturer and royalty agreements. We primarily recognize product revenue at the point in time the software is available to the customer, provided all other revenue recognition criteria are met.

Services and Other

Our services and other revenue is comprised primarily of fees related to project-based consulting, and training, as well as maintenance and support for certain on-premise licenses that are recognized at a point in time and our advertising offerings. We ~~typically~~ sell our project-based consulting contracts on a time-and-materials or fixed-fee basis. These revenues are recognized as the services are performed for time-and-materials contracts and on a relative performance basis for fixed-fee contracts. Training revenues are recognized as the services are performed. Our maintenance and support offerings, which entitle customers, partners and developers to receive desktop product upgrades and enhancements or technical support, depending on the offering, are generally recognized ratably over the term of the arrangement. Transaction-based advertising revenue is recognized on a usage basis as we satisfy the performance obligations to our customers.

~~Segments~~ 35

In fiscal 2024, we categorized our products into the following reportable segments:

•Digital Media—Our Digital Media segment provides products and services that enable individuals, teams, businesses, and enterprises to create, publish and promote their content anywhere and accelerate their productivity by transforming how they view, share, engage with and collaborate on documents and creative content. Our customers include creative professionals, including photographers, video editors, graphic and experience designers and game developers; communicators, including content creators, students, marketers and knowledge workers; and consumers.

•Digital Experience—Our Digital Experience segment provides an integrated platform and set of products, services and solutions that enable businesses to create, manage, execute, measure, monetize and optimize customer

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~~experiences~~partners ~~that~~and ~~span~~developers ~~from~~to ~~analytics~~receive todesktop ~~commerce.~~product ~~Our~~upgrades ~~customers~~and ~~include~~enhancements ~~marketers,~~or ~~advertisers,~~technical ~~agencies~~support, ~~publishers,~~depending ~~merchandisers,~~on ~~merchants~~the offering, ~~web~~are ~~analysts,~~generally ~~data~~recognized ~~scientists,~~ratably ~~developers~~over ~~and~~the ~~executives~~term ~~across~~of the ~~C-suite~~arrangement. Transaction-based advertising revenue is recognized on a usage basis as we satisfy the performance obligations to our customers.

Segments

In fiscal 2025, we categorized our products into the following reportable segments:

•Digital Media—Our Digital Media segment provides products and services that enable individuals, teams, businesses, and enterprises to create, publish and promote their content anywhere and accelerate their productivity by transforming how they view, share, engage with and collaborate on documents and creative content. Our customers span creative professionals, including graphic designers, photographers, videographers, illustrators and 3D artists; creators, including social media influencers and solopreneurs; business professionals, including social media teams, small business owners and knowledge workers; and consumers.

•Digital Experience—Our Digital Experience segment provides marketing professionals with an integrated platform and set of products, services and solutions that enable businesses to create, manage, execute, measure, monetize and optimize customer experiences that span from analytics to commerce. Our customers include marketers, advertisers, brand managers, campaign strategists, merchandisers, merchants, data analysts, developers and executives across the C-suite.

•Publishing and Advertising—Our Publishing and Advertising segment contains legacy products and services that address diverse market opportunities, including eLearning solutions, technical document publishing, web conferencing, document and forms platform, web app development, high-end printing and our Adobe Advertising offerings.

Segment Information

(dollars in millions)	2024			2023			2022			% Change2024-2023
Digital Media	$	15,864		$	14,216		$	12,842		12	%
Percentage of total revenue	74		%	73		%	73		%
Digital Experience	5,366			4,893			4,422			10	%
Percentage of total revenue	25		%	25		%	25		%
Publishing and Advertising	275			300			342			(8)	%
Percentage of total revenue	1		%	2		%	2		%
Total revenue	$	21,505		$	19,409		$	17,606		11	%

Total revenue by reportable segment for fiscal 2025, 2024 and 2023 were as follows:

Digital Media


(dollars in millions)	2025			2024			2023			% Change 2025-2024
Digital Media	$	17,649		$	15,864		$	14,216		11 %	%
Percentage of total revenue	74 %		%	74 %		%	73 %		%
Digital Experience	5,864			5,366			4,893			9 %	%
Percentage of total revenue	25 %		%	25 %		%	25 %		%
Publishing and Advertising	256			275			300			(7)%	%
Percentage of total revenue	1 %		%	1 %		%	2 %		%
Total revenue	$	23,769		$	21,505		$	19,409		11 %	%

Revenue byfrom ~~major~~Digital ~~offerings~~Media inincreased ~~our~~$1.79 billion and revenue from Digital ~~Media~~Experience ~~reportable~~increased ~~segment~~$498 ~~for~~million during fiscal 2025 as compared to fiscal 2024,. ~~2023~~The ~~and~~increases ~~2022~~in total revenue were asdue ~~follows:~~to subscription revenue growth across our Digital Media and Digital Experience offerings.

(dollars in millions)	2024		2023		2022		% Change2024-2023
Creative Cloud	$	12,682	$	11,517	$	10,459	10	%
Document Cloud	3,182		2,699		2,383		18	%
Total Digital Media revenue	$	15,864	$	14,216	$	12,842	12	%

Subscription revenue by reportable segment for fiscal 2025, 2024 and 2023 were as follows:

Revenue from Digital Media increased $1.65 billion during fiscal 2024 as compared to fiscal 2023, driven by increases in revenue associated with our Creative and Document Cloud subscription offerings due to continued demand amid an increasingly digital environment, strong engagement across customer segments and migrating our customers to higher valued subscription offerings with increased revenue per subscription.


(dollars in millions)	2025		2024		2023		% Change 2025-2024
Digital Media	$	17,389	$	15,547	$	13,838	12 %	%
Digital Experience	5,409		4,864		4,331		11 %	%
Publishing and Advertising	106		110		115		(4)%	%
Total subscription revenue	$	22,904	$	20,521	$	18,284	12 %	%

The increase in subscription revenue for the Digital Media segment was driven by strength in Creative Cloud Pro and other flagship apps as well as Acrobat across all routes to market and geographies. The increase in subscription revenue for the Digital Experience segment was driven by strength in GenStudio solutions, and Adobe Experience Platform and related apps.

~~Revenue from Digital Experience increased $473 million during fiscal 2024 as compared to fiscal 2023 driven by subscription revenue growth across our offerings.~~ 36

Geographical Information

(dollars in millions)	2024			2023			2022			% Change2024-2023
Americas	$	12,891		$	11,654		$	10,251		11	%
Percentage of total revenue	60		%	60		%	58		%
EMEA	5,554			4,881			4,593			14	%
Percentage of total revenue	26		%	25		%	26		%
APAC	3,060			2,874			2,762			6	%
Percentage of total revenue	14		%	15		%	16		%
Total revenue	$	21,505		$	19,409		$	17,606		11	%

Overall revenue during fiscal 2024 increased in all geographic regions as compared to fiscal 2023. Within each geographic region, the fluctuations in revenue by reportable segment were attributable to the factors noted in the segment information above.

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~~Included~~Digital inMedia ~~the~~and ~~overall~~Digital ~~change~~Experience insubscription revenue ~~for~~by ~~fiscal~~customer ~~2024~~group asfor ~~compared to~~ fiscal ~~2023~~2025, ~~were impacts associated with foreign currency and our foreign currency hedging program. During fiscal~~ 2024, ~~the U.S. Dollar primarily strengthened against APAC foreign currencies~~ and ~~weakened~~2023 ~~against~~were ~~EMEA foreign currencies~~ as compared to fiscal 2023, which resulted in a net decrease in revenue in U.S. Dollar equivalents of approximately $45 million. During fiscal 2024, we had net hedging losses from our cash flow hedging program of $20 million.follows:


(dollars in millions)	2025		2024		2023		% Change 2025-2024		% Change 2024-2023
Creative & Marketing Professionals	$	16,303	$	14,749	$	13,425	11 %	%	10 %	%
Business Professionals & Consumers	6,495		5,662		4,744		15 %	%	19 %	%
Total Digital Media and Digital Experience subscription revenue	$	22,798	$	20,411	$	18,169	12 %	%	12 %	%

During fiscal 2025 and 2024 as compared to the respective prior years, increases in subscription revenue for the Creative & Marketing Professionals customer group were driven by strength in Creative Cloud Pro and other flagship apps, GenStudio solutions, and Adobe Experience Platform and related apps. During fiscal 2025 and 2024 as compared to the respective prior years, increases in subscription revenue for the Business Professionals & Consumers customer group were driven by strength in Acrobat.

Geographical Information


(dollars in millions)	2025			2024			2023			% Change 2025-2024
Americas	$	14,120		$	12,891		$	11,654		10 %	%
Percentage of total revenue	59 %		%	60 %		%	60 %		%
EMEA	6,289			5,554			4,881			13 %	%
Percentage of total revenue	27 %		%	26 %		%	25 %		%
APAC	3,360			3,060			2,874			10 %	%
Percentage of total revenue	14 %		%	14 %		%	15 %		%
Total revenue	$	23,769		$	21,505		$	19,409		11 %	%

Overall revenue during fiscal 2025 increased in all geographic regions as compared to fiscal 2024. Within each geographic region, the fluctuations in revenue by reportable segment were attributable to the factors noted in the segment information above.

Included in the overall change in revenue were impacts associated with foreign currency which were mitigated in part by our foreign currency hedging program. During fiscal 2025 as compared to fiscal 2024, the U.S. Dollar primarily strengthened against APAC currencies and weakened against EMEA currencies, which resulted in a net decrease in revenue in U.S. Dollar equivalents of approximately $18 million and was offset by net hedging gains of $22 million from our cash flow hedging program.

See Note 2 of our Notes to Consolidated Financial Statements for additional details of revenue by geography.

Cost of Revenue

(dollars in millions)	~~2024~~2025			~~2023~~2024			~~2022~~2023			% ~~Change2024~~Change2025-~~2023~~2024
Subscription	$	12,~~799~~027		$	1,~~822~~799		$	1,~~646~~822		~~(1)~~13 %	%
Percentage of total revenue	89 %		%	98 %		%	9 %		%
Product	2523			2925			3529			(148)%	%
Percentage of total revenue	*			*			*
Services and other	~~534~~501			~~503~~534			~~484~~503			(6)%	%
Percentage of total revenue	2 %		%	32 %		%	3 %		%
Total cost of revenue	$	2,~~358~~551		$	2,~~354~~358		$	2,~~165~~354		*8 %	%

_________________________________________

(*) Percentage is less than 1%.

Subscription

Cost of subscription revenue consists primarily of third-party hosting services and data center costs, including expenses related to operating our network infrastructure and AI inferencing costs. Cost of subscription revenue also includes ~~compensation costs associated with network operations, implementation, account management and technical support personnel, royalty fees, software costs and amortization of certain intangible assets.~~

~~Cost of subscription revenue decreased due to the following:~~37

	Components of% Change2024-2023
Loss contingency	(5)	%
Amortization of intangibles	(2)
Hosting services and data center costs	4
Various individually insignificant items	2
Total change	(1)	%

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~~Cost~~compensation ofcosts ~~subscription~~associated ~~revenue~~with ~~during~~network ~~fiscal~~operations, ~~2024~~implementation, ~~included~~account ~~the~~management ~~reversal~~and oftechnical asupport ~~loss~~personnel, ~~contingency~~royalty ~~incurred~~fees, insoftware ~~fiscal~~costs ~~2023~~and ~~associated~~amortization ~~with~~of ancertain IPintangible ~~litigation matter~~assets.

Cost of subscription revenue increased due to the following:


	Components of % Change 2025-2024
Hosting services and data center costs	8 %	%
Loss contingency reversal	2

Compensation costs	2




Various individually insignificant items	1
Total change	13 %	%

Product

Cost of product revenue is primarily comprised of third-party royalties, localization costs and costs associated with the manufacturing of our products.

Services and Other

Cost of services and other revenue is primarily comprised of compensation and contracted costs incurred to provide consulting services, training and product support, and hosting services and data center costs.

Cost of services and other revenue ~~increased~~decreased during fiscal ~~2024~~2025 as compared to fiscal ~~2023~~2024 primarily due to ~~increases~~decreases in compensation costs and professional fees.

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Operating Expenses

(dollars in millions)	~~2024~~2025			~~2023~~2024			~~2022~~2023			% ~~Change2024~~Change2025-~~2023~~2024
Research and development	$	34,~~944~~294		$	3,~~473~~944		$	23,~~987~~473		149 %	%
Percentage of total revenue	18 %		%	18 %		%	1718 %		%
Sales and marketing	56,~~764~~488			5,~~351~~764			45,~~968~~351			813 %	%
Percentage of total revenue	27 %		%	2827 %		%	28 %		%
General and administrative	1,~~529~~573			1,~~413~~529			1,~~219~~413			83 %	%
Percentage of total revenue	7 %		%	7 %		%	7 %		%
Acquisition termination fee	~~1,000~~—			—1,000			—			**
Percentage of total revenue	5*		%	*5 %		%	*
Amortization of intangibles	~~169~~157			~~168~~169			~~169~~168			1(7)%	%
Percentage of total revenue	1 %		%	1 %		%	1 %		%
Total operating expenses	$	12,~~406~~512		$	1012,~~405~~406		$	910,~~343~~405		191 %	%

_________________________________________

(*) Percentage is less than 1%.

(**) Percentage is not meaningful.

Research and Development

Research and development expenses consist primarily of compensation and contracted costs associated with software development, third-party hosting services and data center costs including AI training costs, related facilities costs, and expenses associated with computer equipment and software used in development activities. Research and development expenses increased during fiscal 2025 as compared to fiscal 2024 primarily due to increases in compensation costs.

Research and development expenses increased due to the following:

	Components of% Change2024-2023
Compensation costs	7	%
Hosting services and data center costs	5
Various individually insignificant items	2
Total change	14	%

Investments in research and development, including the recruiting and hiring of software developers, are critical to remain competitive in the marketplace and are directly related to continued timely development of new and enhanced offerings and solutions. We will continue to focus on long-term opportunities available in our end markets and make significant investments in the development of our subscription and service offerings, apps and tools.

~~Sales and Marketing~~38

Sales and marketing expenses consist primarily of compensation costs, amortization of contract acquisition costs, including sales commissions, travel expenses and related facilities costs for our sales, marketing, order management and global supply chain management personnel. Sales and marketing expenses also include the costs of programs aimed at increasing revenue, such as advertising, trade shows and events, public relations and other market development programs.

Sales and marketing expenses increased due to the following:

	Components of% Change2024-2023
Compensation costs	4	%
Marketing spend related to campaigns, events and overall marketing efforts	2
Various individually insignificant items	2
Total change	8	%

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Sales and Marketing

General and Administrative

General and administrative expenses consist primarily of compensation and contracted costs, travel expenses and related facilities costs for our finance, facilities, human resources, legal, information services and executive personnel. General and administrative expenses also include outside legal and accounting fees, ~~provision for bad debts,~~ expenses associated with computer equipment and software used in the administration of the business, charitable contributions, provision for bad debts and various forms of insurance.

General and administrative expenses increased due to the following:

	Components of% Change2024-2023
	Components of% Change2025-2024
Lease-related asset impairments and other charges	7	%
Compensation costs	5 %	%
Compensation costs	4
Software licenses	2
Professional and consulting fees	~~(5)~~2
Various individually insignificant items	2
Lease-related asset impairments and other charges	(7)
Total change	8	%
Various individually insignificant items	1
Total change	3 %	%

General and administrative expenses during fiscal 2024 included costs associated with the optimization of our leased facilities, primarily consisting of impairment charges for certain operating lease right-of-use assets and leasehold improvements.

Acquisition Termination Fee

During fiscal 2024, we incurred a $1 billion termination fee which resulted from termination of the Figma transaction.

Non-Operating Income (Expense), Net

(dollars in millions)	~~2024~~2025			~~2023~~2024			~~2022~~2023			% ~~Change2024~~Change2025-~~2023~~2024
Interest expense	$	(~~169~~263)		$	(~~113~~169)		$	(~~112~~113)		5056 %	%
Percentage of total revenue	(1)		%	(1)		%	(1)		%
Investment gains (losses), net	43			48			16			**
Investment gains (losses), net	48			16			(19)			**
Other income (expense), net	248			311			246			(20)%	%
Percentage of total revenue	*			*			*
Total non-operating income (expense), net	$	28		$	190		$	149		**
Other income (expense), net	311			246			41			**
Percentage of total revenue	1		%	1		%	*
Total non-operating income (expense), net	$	190		$	149		$	(90)		**

_________________________________________

(*) Percentage is less than 1%.

(**) Percentage is not meaningful.

Interest Expense

Interest expense represents interest associated with our debt instruments. Interest on our senior notes is payable semi-annually, in arrears. Floating interest payments on our interest rate swaps are paid quarterly. The fixed-rate interest receivable on the swaps is received semi-annually concurrent with the senior notes interest payments.

Interest expense increased during fiscal ~~2024~~2025 as compared to fiscal ~~2023~~2024 primarily due to the senior notes issued in ~~April~~January ~~2024~~2025. See ~~Note~~Notes 5 and 17 for further details regarding our interest rate swaps and debt, respectively.

Investment Gains (Losses), Net

Investment gains (losses), net consists principally of unrealized holding gains and losses associated with our deferred compensation plan assets.

4639

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Other Income (Expense), Net

Other income (expense), net consists primarily of interest earned on cash, cash equivalents and short-term fixed income investments. Other income (expense), net also includes realized gains and losses on fixed income investments and foreign exchange gains and losses.

Other income (expense), net ~~increased~~decreased during fiscal ~~2024~~2025 as compared to fiscal ~~2023~~2024 primarily due to ~~increases~~decreases in interest income driven by ~~higher~~lower average overall cash ~~equivalent~~ balances and interest rates.

Provision for Income Taxes

(dollars in millions)	~~2024~~2025			~~2023~~2024			~~2022~~2023			% ~~Change2024~~Change2025-~~2023~~2024
Provision for income taxes	$	1,~~371~~604		$	1,371		$	1,~~252~~371		*17 %	%
Percentage of total revenue	6		%	7		%	7		%
Effective tax rate	18 %		%	20 %		%	20 %		%
Effective tax rate	20		%	20		%	21		%

~~_________________________________________~~Our effective tax rate for fiscal 2025 decreased by approximately two percentage points compared to fiscal 2024, primarily due to the impact of the Figma acquisition termination fee incurred in the prior year, which was not deductible for financial statement purposes, partially offset by a net tax expense related to stock-based compensation recorded in fiscal 2025 as compared to a net tax benefit related to stock-based compensation recorded in the prior year.

~~(*) Percentage~~Our iseffective ~~less~~tax rate for fiscal 2025 was lower than 1the U.S. federal statutory tax rate of 21% primarily due to the net tax benefits from effects of non-U.S. operations and the U.S. federal research tax credit, partially offset by state taxes and a net tax expense related to stock-based compensation.

~~Our~~We ~~effective~~recognize deferred tax ~~rate~~assets ~~for~~to ~~fiscal~~the ~~2024~~extent ~~remained~~that ~~relatively~~we ~~flat~~believe ~~compared~~these assets are more likely than not to ~~fiscal~~be ~~2023,~~realized asbased ~~the~~on ~~impact~~evaluation of all available positive and negative evidence. On the ~~Figma~~basis ~~acquisition~~of ~~termination~~this ~~fee~~evaluation, ~~which~~we ~~was~~continue ~~not~~to ~~deductible~~maintain ~~for~~a ~~financial~~valuation ~~statement~~allowance ~~purposes,~~to ~~was~~reduce ~~largely~~our ~~offset~~deferred bytax ~~increases~~assets into the ~~net~~amount ~~tax~~realizable. ~~benefits~~The ~~from~~total ~~effects~~valuation allowance was $806 million as of ~~non-~~November 28, 2025, primarily related to certain U.S. ~~operations~~state and ~~stock-based~~federal ~~compensation~~credits inand ~~fiscal~~capital ~~2024~~loss carryforwards.

Our effective tax rate for fiscal 2024 was lower than the U.S. federal statutory tax rate of 21% primarily due to the net tax benefits from effects of non-U.S. operations and the U.S. federal research tax credit, partially offset by the impacts of the Figma acquisition termination fee and state taxes.

We recognize deferred tax assets to the extent that we believe these assets are more likely than not to be realized based on evaluation of all available positive and negative evidence. On the basis of this evaluation, we continue to maintain a valuation allowance to reduce our deferred tax assets to the amount realizable. The total valuation allowance was $725 million as of November 29, 2024, primarily related to certain state credits and federal capital loss carryforwards.

We are a U.S.-based multinational company subject to tax in multiple domestic and foreign tax jurisdictions. The current U.S. tax law subjects the earnings of certain foreign subsidiaries to U.S. tax and generally allows an exemption from taxation for distributions from foreign subsidiaries.

In the current global tax policy environment, the domestic and foreign governing bodies continue to consider, and in some cases introduce, changes in regulations applicable to corporate multinationals such as Adobe. As regulations are issued, we account for finalized regulations in the period of enactment.

~~The~~Many ~~provision~~countries ~~from~~have enacted the ~~U.S.~~Organization ~~Tax~~for ~~Act~~Economic ~~which~~Cooperation ~~requires~~and usDevelopment’s to15% ~~capitalize~~global ~~and~~minimum ~~amortize~~tax ~~research~~regime ~~and~~effective ~~development~~for ~~costs~~us ~~became~~starting ~~effective~~ in fiscal ~~2023~~2025. ~~This~~The ~~requirement~~legislation ~~continues~~did tonot have ana ~~adverse~~material impact on our fiscal 2025 effective rates for income taxes or for cash taxes paid, ~~which~~however iswe ~~partially~~continue ~~offset~~to bymonitor adevelopments ~~benefit~~and toevaluate ~~our~~impacts, ~~effective~~if ~~tax~~any, ~~rates~~of ~~from~~these ~~the~~rules ~~increase~~on inour ~~the~~results ~~foreign-derived~~of ~~intangible~~operations ~~income~~and ~~deduction~~cash flows.

~~Several~~On ~~countries~~July ~~have~~4, ~~enacted~~2025, orthe ~~have~~One ~~committed~~Big toBeautiful ~~enact~~Bill Act (“2025 U.S. Tax Act”) was enacted in the United States. Among the changes, the ~~Organization~~2025 ~~for~~U.S. ~~Economic~~Tax ~~Cooperation~~Act restores immediate expensing of domestic research and ~~Development’s~~development ~~15%~~costs ~~global~~and ~~minimum~~modifies ~~tax~~certain ~~regime~~international provisions effective for ~~our~~us starting in fiscal ~~2025~~2026 and 2027, respectively. The ~~currently~~2025 ~~enacted~~U.S. ~~legislation~~Tax isAct did not ~~expected to~~ have a material impact on ~~our~~fiscal ~~provision~~2025 effective rates for income taxes, ~~however~~or for cash taxes paid. While we continue to ~~monitor~~evaluate ~~developments~~the ~~and~~impact ~~evaluate~~for ~~impacts,~~future ~~if any~~years, ofwe ~~these~~anticipate ~~provisions~~a onreduction to our ~~results~~effective ofrates ~~operations~~for ~~and~~ cash ~~flows~~taxes paid in years after fiscal 2025.

See Note 10 of our Notes to Consolidated Financial Statements for further information regarding our provision for income taxes.

Accounting for Uncertainty in Income Taxes

The gross liabilities for unrecognized tax benefits excluding interest and penalties were $~~683~~693 million and $~~501~~683 million at the end of fiscal ~~2024~~2025 and ~~2023~~2024, respectively. If the total unrecognized tax benefits as of November 2928, ~~2024~~2025 and ~~December~~November 129, ~~2023~~2024 were recognized, $~~519~~528 million and $~~356~~519 million would decrease the respective effective tax rates.

As of November 2928, ~~2024~~2025 and ~~December~~November 129, ~~2023~~2024, the combined amounts of accrued interest and penalties included in long-term income taxes payable related to tax positions taken on our tax returns were not material.

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The timing of the resolution of income tax examinations is highly uncertain as are the amounts and timing of tax payments that are part of any audit settlement process. These events could cause large fluctuations in the balance sheet classification of our tax assets and liabilities. We believe that within the next 12 months, it is reasonably possible that either certain audits will conclude or statutes of limitations on certain income tax examination periods will expire, or both. Although the timing of resolution, settlement and closing of audits is not certain, it is reasonably possible that the underlying unrecognized tax benefits may decrease by up to $5040 million over the next 12 months.

Our future effective tax rates may be materially affected by changes in the tax rates in jurisdictions where our income is earned, changes in jurisdictions in which our profits are determined to be earned and taxed, changes in the valuation of our deferred tax assets and liabilities, changes in or interpretation of tax rules and regulations in the jurisdictions in which we do business, or unexpected changes in business and market conditions that could reduce certain tax benefits.

In addition, tax laws in the United States as well as other countries and jurisdictions in which we conduct business are subject to change as new laws are passed and/or new interpretations are made available. These countries, governmental bodies, such as the European Commission of the European Union, and intergovernmental economic organizations, such as the Organization for Economic Cooperation and Development, have made and/or could make other unprecedented assertions about how taxation is determined and, in some cases, have proposed or enacted new laws that are contrary to the way in which rules and regulations have historically been interpreted and applied. Changes in our operating landscape, such as changes in laws ~~and/~~or interpretations of tax rules, ~~could~~have in the past and may in the future adversely affect our effective tax rates and/or cause us to respond by making changes to our business structure, which could adversely affect our operations and financial results.

Moreover, we are subject to the examination of our income tax returns by domestic and foreign tax authorities. We regularly assess the likelihood of outcomes resulting from these examinations to determine the adequacy of our provision for income taxes and have reserved for potential adjustments that may result from these examinations. Our policy is to record interest and penalties related to unrecognized tax benefits in income tax expense. While we believe our tax estimates are reasonable, we cannot provide assurance that the final determination of any of these examinations will not have an adverse effect on our financial position and results of operations.

LIQUIDITY AND CAPITAL RESOURCES

Cash Flows

Our primary source of cash is receipts from revenue. Other customary sources of cash include proceeds from maturities and sales of short-term investments and issuance of debt instruments. Our primary uses of cash are general business expenses including payroll and related benefits costs, income taxes, marketing and third-party hosting services, as well as our stock repurchase program as described below. Other customary uses of cash include purchases of short-term investments, property and equipment, ~~and~~ payments for taxes related to net share settlement of equity awards, repayment of debt instruments and business acquisitions.

This data should be read in conjunction with our Consolidated Statements of Cash Flows.

	As of
(in millions)	November 2928, ~~2024~~2025		~~December~~November 129, ~~2023~~2024
Cash and cash equivalents	$	75,~~613~~431	$	7,~~141~~613
Short-term investments	$	~~273~~1,164	$	~~701~~273
Working capital	$	~~711~~(37)	$	~~2,833~~711
Stockholders’ equity	$	1411,~~105~~623	$	1614,~~518~~105

A summary of our cash flows for fiscal ~~2024~~2025, ~~2023~~2024 and ~~2022~~2023 is as follows:

(in millions)

~~2024~~2025

~~2023~~2024

~~2022~~2023

Net cash provided by operating activities

810,~~056~~031

78,~~302~~056

7,~~838~~302

Net cash provided by (used for) investing activities

~~149~~(1,187)

~~776~~149

~~(570)~~776

Net cash used for financing activities

(711,~~724~~060)

(57,~~182~~724)

(65,~~825~~182)

Effect of foreign currency exchange rates on cash and cash equivalents

~~(9)~~34

(9)

~~(51)~~9

Net change in cash and cash equivalents

~~472~~(2,182)

~~2,905~~472

~~392~~2,905

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Cash Flows from Operating Activities

For fiscal ~~2024~~2025, net cash provided by operating activities of $810.0603 billion was primarily comprised of net income adjusted for the net effect of non-cash items. ~~Payment~~Working ofcapital ~~the~~sources $1of ~~billion~~cash ~~Figma~~included ~~termination~~increases ~~fee~~in ~~during~~deferred ~~fiscal~~revenue, ~~2024~~partially ~~had~~offset anby ~~adverse~~increases ~~impact~~in ontrade ~~net~~receivables ~~income~~attributable ~~and~~to ~~cash~~the ~~flows~~timing ~~from~~of ~~operations~~billings.

Cash Flows from Investing Activities

For fiscal ~~2024~~2025, net cash ~~provided~~used byfor investing activities of $~~149~~1.19 ~~million~~billion was primarily due to ~~maturities~~purchases of short-term and long-term investments, ~~partially~~net ~~offset~~of byproceeds ~~ongoing~~from ~~capital~~the ~~expenditures~~maturities ~~and purchases~~ of ~~long~~short-term investments, and ~~short-term~~ongoing ~~investments~~capital expenditures.

Cash Flows from Financing Activities

For fiscal ~~2024~~2025, net cash used for financing activities of $711.7206 billion was primarily due to payments for our common stock repurchases, ~~partially~~and repayment of our 1.90% 2025 Notes and 3.25% 2025 Notes. These uses of cash were offset in part by proceeds from the issuance of senior notes. See the sections titled “Senior Notes” and “Stock Repurchase Program” below.

Liquidity and Capital Resources Considerations

Our existing cash, cash equivalents and investment balances may fluctuate during fiscal ~~2025~~2026 due to changes in our planned cash outlay.

Cash from operations could also be affected by various risks and uncertainties, including, but not limited to, risks detailed in the section titled “Risk Factors” in Part I, Item 1A of this report. Based on our current business plan and revenue prospects, we believe that our existing cash, cash equivalents and short-term investment balances, our anticipated cash flows from operations and our available revolving credit facility will be sufficient to meet our working capital, operating resource expenditure and capital expenditure requirements for the next twelve months and for the foreseeable future.

Our cash equivalent and short-term investment portfolio as of November 2928, ~~2024~~2025 consisted of money market funds, corporate debt securities, U.S. Treasury securities, time deposits, ~~U.S. agency securities~~ and ~~asset-backed~~other ~~securities~~investments. ~~We use professional investment management firms to manage a large portion of our invested cash.~~

We expect to continue our investing activities, including short-term and long-term investments, purchases of computer and server hardware to operate our network infrastructure, sales and marketing, product support and administrative staff. Furthermore, cash reserves may be used to repurchase stock under our stock repurchase program and to strategically acquire companies, products or technologies that are complementary to our business.

On November 18, 2025, we entered into a definitive agreement to acquire Semrush Holdings, Inc., a publicly held brand visibility platform company, for approximately $1.9 billion of cash consideration. The transaction is subject to regulatory approvals and customary closing conditions and is expected to close in the first half of fiscal 2026. We expect to finance the acquisition using cash on hand.

Revolving Credit Agreement

We have a $1.5 billion senior unsecured revolving credit agreement (the “Revolving Credit Agreement”) with a syndicate of lenders, providing for loans to us and certain of our subsidiaries through June 30, 2027. Subject to the agreement of lenders, we may obtain up to an additional $500 million in commitments, for a maximum aggregate commitment of $2 billion. As of November 2928, ~~2024~~2025, there were no outstanding borrowings under the Revolving Credit Agreement and the entire $1.5 billion credit line remains available for borrowing. Under the terms of our Revolving Credit Agreement, we are not prohibited from paying cash dividends unless payment would trigger an event of default or if one currently exists. We do not anticipate paying any cash dividends in the foreseeable future.

Commercial Paper Program

We have a commercial paper program under which we may issue unsecured commercial paper up to a total of $3 billion outstanding at any time, with maturities of up to 397 days from the date of issue. The net proceeds from the issuance of commercial paper are expected to be used for general corporate purposes, which may include working capital, capital expenditures, acquisitions, stock repurchases, refinancing indebtedness or any other general corporate purposes. As of November 2928, ~~2024~~2025, there were no outstanding borrowings under the commercial paper program.

~~Senior Notes~~42

In April 2024, we issued $500 million of senior notes due April 4, 2027, $750 million of senior notes due April 4, 2029 and $750 million of senior notes due April 4, 2034. In total, we have $5.65 billion of senior notes outstanding, which rank equally with our other unsecured and unsubordinated indebtedness. As of November 29, 2024, the carrying value of our senior notes was $5.63 billion and our maximum commitment for interest payments was $806 million for the remaining duration of our outstanding senior notes. Interest is payable semi-annually, in arrears. Our senior notes do not contain any financial covenants. See Note 17 of our Notes to Consolidated Financial Statements for further details regarding our debt.

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~~During~~Senior the first quarter of fiscal 2024, we reclassified the senior notes due February 1, 2025 as current debt in our Consolidated Balance Sheets. As of November 29, 2024, the carrying value of our current debt was $1.50 billion, net of the related discount and issuance costs. Though we intend to refinance the current portion of our debt on or before the due date, the timing of the refinancing may be impacted by market conditions.Notes

In January 2025, we issued $800 million of senior notes due January 17, 2028, $700 million of senior notes due January 17, 2030 and $500 million of senior notes due January 17, 2035. In total, we have $6.15 billion of senior notes outstanding, which rank equally with our other unsecured and unsubordinated indebtedness. During fiscal 2025, we entered into interest rate swaps for certain of our senior notes that effectively convert the fixed interest rates on the notes to floating interest rates. As of November 28, 2025, the carrying value of our senior notes was $6.21 billion, net of fair value of the interest rate swaps and unamortized discount and debt issuance costs, and our maximum commitment for interest payments was $1.03 billion for the remaining duration of our outstanding senior notes and interest rate swaps. Interest on the notes is payable semi-annually, in arrears, and interest on the swaps is payable quarterly. Our senior notes do not contain any financial covenants. See Note 17 of our Notes to Consolidated Financial Statements for further details regarding our debt.

Contractual Obligations

Our principal commitments consist of purchase obligations resulting from agreements to purchase goods and services in the ordinary course of business. As of November 2928, ~~2024~~2025, the value of our non-cancellable unconditional purchase obligations was $56.7982 billion, primarily relating to contracts with vendors for third-party hosting and data center services. See Note 16 of our Notes to Consolidated Financial Statements for additional information regarding our purchase obligations.

We lease certain facilities and data centers under non-cancellable operating lease arrangements that expire at various dates through ~~2034~~2038. As of November 2928, ~~2024~~2025, the value of our obligations under operating leases was $~~463~~485 million. See Note 187 of our Notes to Consolidated Financial Statements for additional information regarding our lease obligations.

Stock Repurchase Program

To facilitate our stock repurchase program, designed to return value to our stockholders and minimize dilution from stock issuances, we may repurchase our shares in the open market or enter into structured repurchase agreements with third parties. In ~~December~~March ~~2020~~2024, our Board of Directors granted authority to repurchase up to $1525 billion in our common stock, ~~which~~through ~~became~~March ~~fully~~14, ~~utilized during fiscal 2024~~2028. In ~~March~~September ~~2024~~2025, ~~our~~we ~~Board~~entered ofinto ~~Directors~~a ~~granted~~stock ~~additional~~repurchase ~~authority~~arrangement with a large financial institution to ~~repurchase~~execute up to $25 2.5 billion in ~~our~~open ~~common~~market ~~stock~~repurchases, ~~through~~which ~~March~~remained 14partially outstanding as of November 28, ~~2028~~2025. Upon completion of this arrangement, $5.90 billion remains under our March 2024 stock repurchase authority.

During fiscal ~~2024~~2025, we entered into ~~accelerated~~stock ~~share~~ repurchase ~~agreements~~arrangements ~~(“ASRs”)~~ with large financial institutions ~~whereupon~~and wemade ~~provided~~payments ~~them with prepayments~~ totaling $911.528 billion. ~~Subsequent~~ to ~~November 29, 2024, as part of the March 2024 stock~~ repurchase ~~authority, we entered into stock repurchase arrangements with a large financial institution which totaled $3~~shares.~~25 billion, including a $2.75 billion ASR and a trading plan under which we may execute up to $500 million in open market repurchases.~~

See section titled “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities” in Part II, Item 5 of this report for stock repurchases during the quarter ended November 2928, ~~2024~~2025 and Note 14 of our Notes to Consolidated Financial Statements for further details regarding our stock repurchase program.

Indemnifications

In the ordinary course of business, we provide indemnifications of varying scope to our customers and channel partners against claims of intellectual property infringement made by third parties arising from the use of our products and from time to time, we are subject to claims by our customers under these indemnification provisions. Historically, costs related to these indemnification provisions have not been significant and we are unable to estimate the maximum potential impact of these indemnification provisions on our future results of operations.

To the extent permitted under Delaware law, we have agreements whereby we indemnify our officers and directors for certain events or occurrences while the officer or director is or was serving at our request in such capacity. The indemnification period covers all pertinent events and occurrences during the officer’s or director’s lifetime. The maximum potential amount of future payments we could be required to make under these indemnification agreements is unlimited; however, we have director and officer insurance coverage that reduces our exposure and enables us to recover a portion of any future amounts paid.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

All market risk sensitive instruments were entered into for non-trading purposes.

Foreign Currency Risk

Foreign Currency Exposures and Hedging Instruments

In countries outside the United States, we transact business in U.S. Dollars and various other currencies, which subject us to exposure from movements in exchange rates. We may use foreign exchange forward contracts and option contracts to hedge a portion of our forecasted foreign currency denominated revenue and expenses. Additionally, we hedge our net recognized foreign currency monetary assets and liabilities with foreign exchange forward contracts to reduce the risk that our earnings and cash flows will be adversely affected by changes in exchange rates.

Our significant foreign currency revenue exposures for fiscal ~~2024~~2025, ~~2023~~2024 and ~~2022~~2023 were as follows:

(in millions)	~~2024~~2025		~~2023~~2024		~~2022~~2023
Euro	€	3,~~149~~430	€	23,~~842~~149	€	2,~~487~~842
Japanese Yen	¥	~~144~~163,~~800~~826	¥	~~129~~144,~~127~~800	¥	~~118~~129,~~456~~127
British Pounds	£	~~887~~942	£	~~818~~887	£	~~737~~818
Australian Dollars	$	1,~~064~~136	$	~~973~~1,064	$	~~876~~973
Canadian Dollars	$	743	$	669	$	599

As of November 2928, ~~2024~~2025, the ~~total~~gross notional amounts of all outstanding foreign exchange contracts ~~were~~totaled $56.8954 billion, which included the notional equivalent of $23.7327 billion in Euros, $~~791~~884 million in Japanese Yen, $~~714~~741 million in British Pounds, $~~609~~668 million in Indian Rupees, $~~585~~543 million in Australian Dollars, $~~386~~391 million in Canadian dollars and $7639 million in other foreign currencies. As of November 2928, ~~2024~~2025, all contracts were set to expire at various dates through September ~~2026~~2027. The bank counterparties in these contracts could expose us to credit-related losses that would be largely mitigated with master netting arrangements with the same counterparty by permitting net settlement transactions. In addition, we enter into collateral security agreements that provide for collateral to be received or posted when the net fair value of these contracts fluctuates from contractually established thresholds.

A sensitivity analysis was performed on all of our foreign exchange derivatives as of November 2928, ~~2024~~2025. This sensitivity analysis measures the hypothetical market value resulting from a 10% shift in the value of exchange rates relative to the U.S. Dollar. A 10% increase in the value of the U.S. Dollar and a corresponding decrease in the value of the hedged foreign currency asset would lead to an increase in the fair value of our financial hedging instruments by $~~434~~456 million. A 10% decrease in the value of the U.S. Dollar would lead to a decrease in the fair value of these financial instruments by $~~434~~456 million.

As a general rule, we do not use foreign exchange contracts to hedge local currency denominated operating expenses in countries where a natural hedge exists. For example, in many countries, revenue in the local currencies substantially offsets the local currency denominated operating expenses. We also have long-term investment exposures consisting of the capitalization and retained earnings in our non-U.S. Dollar functional currency foreign subsidiaries. As of November 2928, ~~2024~~2025 and ~~December~~November 129, ~~2023~~2024, this long-term investment exposure totaled an absolute notional equivalent of $1.1932 billion and $1.0319 billion, respectively. At this time, we do not hedge these long-term investment exposures.

We do not use foreign exchange contracts for speculative trading purposes, nor do we hedge our foreign currency exposure in a manner that entirely offsets the effects of changes in foreign exchange rates. We regularly review our hedging program and assess the need to utilize financial instruments to hedge currency exposures on an ongoing basis.

Cash Flow Hedges of Forecasted Foreign Currency Revenue and Expenses

We may use foreign exchange purchased forward contracts or option contracts to hedge foreign currency revenue denominated in Euros, Japanese Yen, British Pounds, Australian Dollars and Canadian Dollars, or foreign currency expenses in Indian Rupees. We hedge these cash flow exposures to reduce the risk that our earnings and cash flows will be adversely affected by changes in exchange rates. These foreign exchange contracts, carried at fair value, have maturities of up to 24 months. We enter into these foreign exchange contracts to hedge forecasted revenue and expenses in the normal course of business and accordingly, they are not speculative in nature.

We record changes in fair value of these cash flow hedges of foreign currency denominated revenue and expenses in accumulated other comprehensive income (loss) in our Consolidated Balance Sheets, until the forecasted transaction occurs. When the forecasted transaction affects earnings, we reclassify the related gain or loss on the cash flow hedge to revenue or operating expenses, as applicable. In the event the underlying forecasted transaction does not occur, or it becomes probable that

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When the forecasted transaction affects earnings, we reclassify the related gain or loss on the cash flow hedge to revenue or operating expenses, as applicable. In the event the underlying forecasted transaction does not occur, or it becomes probable that it will not occur, we reclassify the gain or loss on the related cash flow hedge from accumulated other comprehensive income (loss) to revenue or operating expenses, as applicable. For the fiscal year ended November 2928, ~~2024~~2025, there were no net gains or losses recognized in revenue or operating expenses relating to hedges of forecasted transactions that did not occur.

Non-Designated Hedges of Foreign Currency Assets and Liabilities

Our derivatives not designated as hedging instruments consist of foreign currency forward contracts that we primarily use to hedge monetary assets and liabilities denominated in non-functional currencies to reduce the risk that our earnings and cash flows will be adversely affected by changes in foreign currency exchange rates. These foreign exchange contracts are carried at fair value with changes in fair value of these contracts recorded to other income (expense), net in our Consolidated Statements of Income. These contracts reduce the impact of currency exchange rate movements on our assets and liabilities. At November 2928, ~~2024~~2025, the outstanding balance sheet hedging derivatives had maturities of 180 days or less.

See Note 65 of our Notes to Consolidated Financial Statements for information regarding our derivative financial instruments.

Interest Rate Risk

Short-Term Investments and Fixed Income Securities

At November 2928, ~~2024~~2025, we had debt securities classified as short-term investments of $~~273~~1.16 ~~million~~billion. Changes in interest rates could adversely affect the market value of these investments. A sensitivity analysis was performed on our short-term investment portfolio as of November 2928, ~~2024~~2025, based on an estimate of the hypothetical changes in market value of the portfolio that would result from an immediate parallel shift in the yield curve. A 150 basis point increase in interest rates would lead to a $14 million decrease in the market value of our short-term investments. Conversely, a 150 basis point decrease in interest rates would lead to a $14 million increase in the market value of our short-term investments.

Senior Notes

As of November 2928, ~~2024~~2025, we had $56.6515 billion of senior notes outstanding. ~~which~~We ~~bear~~have entered into interest atrate swaps related to certain of our senior notes that effectively convert the fixed interest rates, ~~and~~to ~~therefore~~floating dointerest ~~not~~rates ~~subject~~based uson tothe ~~financial~~Secured ~~statement~~Overnight ~~risk~~Financing ~~associated~~Rate ~~with~~Overnight ~~changes~~Index Swap Rate plus a fixed number of basis points through their respective par call dates. Accordingly, our exposure to fluctuations in market interest rates. Asis on the hedged fixed-rate debt of ~~November 29,~~$2.70 ~~2024,~~billion. An immediate hypothetical 50 basis point increase or decrease in market interest rates would lead to a $71 million change in the ~~total~~fair ~~carrying~~value ~~amount~~of our hedged fixed-rate debt. The remainder of our outstanding senior notes ~~was~~bear ~~$5.63~~interest ~~billion~~at fixed rates, and ~~the~~therefore ~~related~~do ~~fair~~not ~~value~~subject ~~based~~us onto ~~observable~~financial ~~market~~statement ~~prices~~risk inassociated ~~less~~with ~~active~~changes ~~markets~~in ~~was~~interest $5rates.51 ~~billion.~~

As of November 28, 2025, the total carrying amount of our senior notes was $6.21 billion and the related fair value based on observable market prices in less active markets was $6.18 billion.

See Note 17 of our Notes to Consolidated Financial Statements for information regarding our senior notes.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

			Page No.
Consolidated Balance Sheets			5447
Consolidated Statements of Income			5548
Consolidated Statements of Comprehensive Income			5649
Consolidated Statements of Stockholders' Equity			5750
Consolidated Statements of Cash Flows			5851
Notes to Consolidated Financial Statements			5952
Report of Independent Registered Public Accounting Firm (KPMG LLP, Santa Clara, California, PCAOB ID 185)			9185

All financial statement schedules have been omitted, since the required information is not applicable or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the Consolidated Financial Statements and Notes thereto.

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ADOBE INC.

CONSOLIDATED BALANCE SHEETS

(In millions, except par value)

	November 29,2024		December 1,2023
	November 28,2025		November 29,2024
ASSETS
Current assets:
Cash and cash equivalents	$	75,~~613~~431	$	7,~~141~~613
Short-term investments	~~273~~1,164		~~701~~273
Trade receivables, net of allowances for doubtful accounts of $14 and of $16, respectively	2,072		2,224
Trade receivables, net of allowances for doubtful accounts of $13 and of $14, respectively	2,344		2,072
Prepaid expenses and other current assets	1,~~274~~224		1,~~018~~274
Total current assets	1110,~~232~~163		11,~~084~~232
Property and equipment, net	1,~~936~~873		21,~~030~~936
Operating lease right-of-use assets, net	~~281~~312		~~358~~281
Goodwill	12,~~788~~857		12,~~805~~788
Other intangibles, net	~~782~~495		~~1,088~~782
Deferred income taxes	12,~~657~~186		1,~~191~~657
Other assets	1,~~554~~610		1,~~223~~554
Total assets	$	3029,~~230~~496	$	2930,~~779~~230
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Trade payables	$	~~361~~417	$	~~314~~361
Accrued expenses	2,336		1,942
Accrued expenses and other current liabilities	2,648		2,336
Debt	~~1,499~~—		—1,499
Deferred revenue	6,~~131~~905		56,~~837~~131
Income taxes payable	~~119~~153		85119
Operating lease liabilities	7577		7375
Total current liabilities	10,~~521~~200		810,~~251~~521
Long-term liabilities:
Debt	46,~~129~~210		34,~~634~~129
Deferred revenue	~~128~~125		~~113~~128
Income taxes payable	~~548~~469		~~514~~548
Operating lease liabilities	~~353~~361		~~373~~353
Other liabilities	~~446~~508		~~376~~446
Total liabilities	1617,~~125~~873		1316,~~261~~125
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.0001 par value; 2 shares authorized; none issued	—		—
Common stock, $0.0001 par value; 900 shares authorized; 601 shares issued; 441 and 455 shares outstanding, respectively	—		—
Common stock, $0.0001 par value; 900 shares authorized; 601 shares issued; 413 and 441 shares outstanding, respectively	—		—
Additional paid-in capital	1315,~~419~~361		1113,~~586~~419
Retained earnings	3845,~~470~~354		3338,~~346~~470
Accumulated other comprehensive income (loss)	(~~201~~245)		(~~285~~201)
Treasury stock, at cost (160 and 146 shares, respectively)	(37,583)		(28,129)
Treasury stock, at cost (188 and 160 shares, respectively)	(48,847)		(37,583)
Total stockholders’ equity	1411,~~105~~623		1614,~~518~~105
Total liabilities and stockholders’ equity	$	3029,~~230~~496	$	2930,~~779~~230

See accompanying Notes to Consolidated Financial Statements.

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ADOBE INC.

CONSOLIDATED STATEMENTS OF INCOME

(In millions, except per share data)

Years Ended

November 29,2024

December 1,2023

December 2,2022

November 28,2025

November 29,2024

December 1,2023

Revenue:

Subscription

2022,~~521~~904

1820,~~284~~521

1618,~~388~~284

Product

~~386~~325

~~460~~386

~~532~~460

Services and other

~~598~~540

~~665~~598

~~686~~665

Total revenue

2123,~~505~~769

1921,~~409~~505

1719,~~606~~409

Cost of revenue:

Subscription

12,~~799~~027

1,~~822~~799

1,~~646~~822

Product

2523

2925

3529

Services and other

~~534~~501

~~503~~534

~~484~~503

Total cost of revenue

2,~~358~~551

2,~~354~~358

2,~~165~~354

Gross profit

1921,~~147~~218

1719,~~055~~147

1517,~~441~~055

Operating expenses:

Research and development

34,~~944~~294

3,~~473~~944

23,~~987~~473

Sales and marketing

56,~~764~~488

5,~~351~~764

45,~~968~~351

General and administrative

1,~~529~~573

1,~~413~~529

1,~~219~~413

Acquisition termination fee

~~1,000~~—

—1,000

—

Amortization of intangibles

~~169~~157

~~168~~169

~~169~~168

Total operating expenses

12,~~406~~512

1012,~~405~~406

910,~~343~~405

Operating income

68,~~741~~706

6,~~650~~741

6,~~098~~650

Non-operating income (expense):

Interest expense

(~~169~~263)

(~~113~~169)

(~~112~~113)

Investment gains (losses), net

4843

1648

~~(19)~~16

Other income (expense), net

~~311~~248

~~246~~311

41246

Total non-operating income (expense), net

~~190~~28

~~149~~190

~~(90)~~149

Income before income taxes

68,~~931~~734

6,~~799~~931

6,~~008~~799

Provision for income taxes

1,~~371~~604

1,371

1,~~252~~371

Net income

57,~~560~~130

5,~~428~~560

45,~~756~~428

Basic net income per share

1216.4373

1112.8743

1011.1387

Shares used to compute basic net income per share

~~447~~426

~~457~~447

~~470~~457

Diluted net income per share

1216.3670

1112.8236

1011.1082

Shares used to compute diluted net income per share

~~450~~427

~~459~~450

~~471~~459

See accompanying Notes to Consolidated Financial Statements.

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ADOBE INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

Years Ended

November 29,2024

December 1,2023

December 2,2022

November 28,2025

November 29,2024

December 1,2023

Increase/(Decrease)

Net income

57,~~560~~130

5,~~428~~560

45,~~756~~428

Other comprehensive income (loss), net of taxes:

Available-for-sale securities:

Unrealized gains / losses on available-for-sale securities

111

2411

~~(39)~~24

Reclassification adjustment for recognized gains / losses on available-for-sale securities

—

5—

—5

Net increase (decrease) from available-for-sale securities

111

2911

~~(39)~~29

Derivatives designated as hedging instruments:

Unrealized gains / losses on derivative instruments

89(132)

~~(12)~~89

~~139~~(12)

Reclassification adjustment for realized gains / losses on derivative instruments

177

~~(31)~~17

(~~151~~31)

Net increase (decrease) from derivatives designated as hedging instruments

~~106~~(125)

~~(43)~~106

(1243)

Foreign currency translation adjustments

~~(33)~~80

22(33)

~~(105)~~22

Other comprehensive income (loss), net of taxes

84(44)

884

~~(156)~~8

Total comprehensive income, net of taxes

57,~~644~~086

5,~~436~~644

45,~~600~~436

See accompanying Notes to Consolidated Financial Statements.

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ADOBE INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In millions)

	Common Stock			AdditionalPaid-InCapital		RetainedEarnings		AccumulatedOtherComprehensiveIncome (Loss)		Treasury Stock
	Shares	Amount								Shares	Amount		Total
Balances at December 3, 2021	601	$	—	$	8,428	$	23,905	$	(137)	(126)	$	(17,399)	$	14,797
Net income	—	—		—		4,756		—		—	—		4,756
Other comprehensive income (loss), net of taxes	—	—		—		—		(156)		—	—		(156)
Re-issuance of treasury stock under stock compensation plans	—	—		—		(342)		—		3	102		(240)
Repurchases of common stock	—	—		—		—		—		(16)	(6,550)		(6,550)
Stock-based compensation	—	—		1,440		—		—		—	—		1,440
Value of shares in deferred compensation plan	—	—		—		—		—		—	4		4
Balances at December 2, 2022	601	$	—	$	9,868	$	28,319	$	(293)	(139)	$	(23,843)	$	14,051
Net income	—	—		—		5,428		—		—	—		5,428
Other comprehensive income (loss), net of taxes	—	—		—		—		8		—	—		8
Re-issuance of treasury stock under stock compensation plans	—	—		—		(401)		—		5	126		(275)
Repurchases of common stock	—	—		—		—		—		(12)	(4,414)		(4,414)
Stock-based compensation	—	—		1,718		—		—		—	—		1,718
Value of shares in deferred compensation plan	—	—		—		—		—		—	2		2
Balances at December 1, 2023	601	$	—	$	11,586	$	33,346	$	(285)	(146)	$	(28,129)	$	16,518
Net income	—	—		—		5,560		—		—	—		5,560
Other comprehensive income (loss), net of taxes	—	—		—		—		84		—	—		84
Re-issuance of treasury stock under stock compensation plans	—	—		—		(436)		—		4	120		(316)
Repurchases of common stock	—	—		—		—		—		(18)	(9,574)		(9,574)
Stock-based compensation	—	—		1,833		—		—		—	—		1,833
Balances at November 29, 2024	601	$	—	$	13,419	$	38,470	$	(201)	(160)	$	(37,583)	$	14,105
Net income	—	—		—		7,130		—		—	—		7,130
Other comprehensive income (loss), net of taxes	—	—		—		—		(44)		—	—		(44)
Re-issuance of treasury stock under stock compensation plans	—	—		—		(246)		—		3	119		(127)
Repurchases of common stock	—	—		—		—		—		(31)	(11,386)		(11,386)
Stock-based compensation	—	—		1,942		—		—		—	—		1,942
Value of shares in deferred compensation plan	—	—		—		—		—		—	3		3
Balances at November 28, 2025	601	$	—	$	15,361	$	45,354	$	(245)	(188)	$	(48,847)	$	11,623

See accompanying Notes to Consolidated Financial Statements.

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ADOBE INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

Years Ended

November 29,2024

December 1,2023

December 2,2022

November 28,2025

November 29,2024

December 1,2023

Cash flows from operating activities:

Net income

57,~~560~~130

5,~~428~~560

45,~~756~~428

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation, amortization and accretion

~~857~~818

~~872~~857

~~856~~872

Stock-based compensation

1,~~833~~942

1,~~718~~833

1,~~440~~718

Reduction of operating lease right-of-use assets

Lease-related asset impairments

—

Lease-related asset impairments

—

Deferred income taxes

(512)

(468)

(426)

Deferred income taxes

(468)

(426)

328

Other non-cash items

Unrealized losses (gains) on investments, net

(35)

(10)

Other non-cash items

Changes in operating assets and liabilities, net of acquired assets and assumed liabilities:

Trade receivables, net

~~143~~(275)

~~(159)~~143

(~~198~~159)

Prepaid expenses and other assets

(~~616~~90)

(~~818~~616)

(94818)

Trade payables

4464

~~(49)~~44

66(49)

Accrued expenses and other liabilities

~~196~~180

~~146~~196

7146

Income taxes payable

68(45)

~~(11)~~68

19(11)

Deferred revenue

~~309~~771

~~536~~309

536

Net cash provided by operating activities

810,~~056~~031

78,~~302~~056

7,~~838~~302

Cash flows from investing activities:

Purchases of short-term investments

(592,034)

—(59)

~~(909)~~—

Maturities of short-term investments

~~486~~1,168

~~965~~486

~~683~~965

Proceeds from sales of short-term investments

116

~~223~~11

~~270~~223

Acquisitions, net of cash acquired

—(17)

—

~~(126)~~—

Purchases of property and equipment

(~~183~~179)

(~~360~~183)

(~~442~~360)

Purchases of long-term investments, intangibles and other assets

(~~108~~134)

(53108)

(4653)

Proceeds from sales of long-term investments and other assets

—

Other investing activities, net

Net cash provided by (used for) investing activities

~~149~~(1,187)

~~776~~149

~~(570)~~776

Cash flows from financing activities:

Repurchases of common stock

(911,~~500~~281)

(49,~~400~~500)

(64,~~550~~400)

Proceeds from re-issuance of treasury stock

~~361~~348

~~314~~361

~~278~~314

Taxes paid related to net share settlement of equity awards

(~~677~~475)

(~~589~~677)

(~~518~~589)

Proceeds from issuance of debt

1,997

—1,997

—

Repayment of debt

—(1,500)

~~(500)~~—

—(500)

Other financing activities, net

95(149)

~~(7)~~95

(357)

Net cash used for financing activities

(711,~~724~~060)

(57,~~182~~724)

(65,~~825~~182)

Effect of foreign currency exchange rates on cash and cash equivalents

~~(9)~~34

(9)

~~(51)~~9

Net change in cash and cash equivalents

~~472~~(2,182)

~~2,905~~472

~~392~~2,905

Cash and cash equivalents at beginning of year

7,~~141~~613

47,~~236~~141

34,~~844~~236

Cash and cash equivalents at end of year

75,~~613~~431

7,~~141~~613

47,~~236~~141

Supplemental disclosures:

Cash paid for income taxes, net of refunds

12,~~727~~219

1,~~854~~727

~~778~~1,854

Cash paid for interest

~~143~~246

~~106~~143

~~103~~106

See accompanying Notes to Consolidated Financial Statements.

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ADOBE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Operations

Basis of Presentation

The accompanying Consolidated Financial Statements include those of Adobe and its subsidiaries, after elimination of all intercompany accounts and transactions. We have prepared the accompanying Consolidated Financial Statements in accordance with generally accepted accounting principles in the United States (“GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”).

Use of Estimates

In preparing the Consolidated Financial Statements and related disclosures in conformity with GAAP and pursuant to the rules and regulations of the SEC, we must make estimates and judgments that affect the amounts reported in the Consolidated Financial Statements and accompanying Notes. Estimates are used for, but not limited to, sales allowances and programs, bad debts, stock-based compensation, determining the fair value of acquired assets and assumed liabilities, litigation and income taxes. Actual results may differ materially from these estimates.

Fiscal Year

Our fiscal year is a 52- or 53-week year that ends on the Friday closest to November 30. Fiscal years ~~2024~~2025, ~~2023~~2024 and ~~2022~~2023 were 52-week years. Our next 53-week year will be fiscal year 2027.

Reclassifications

Certain prior year amounts, which are not material, have been reclassified to conform to current year presentation in the Consolidated Statements of Cash Flows and Notes to Consolidated Financial Statements.

Significant Accounting Policies

Revenue Recognition

Our revenue is derived from the sale of cloud-enabled software subscriptions, cloud-hosted offerings, term-based, royalty, and perpetual software licenses, associated software maintenance and support plans, consulting services, training and technical support. Most of our enterprise customer arrangements involve multiple promises to our customers.

Revenue is recognized when a contract exists between us and a customer and upon transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. We enter into contracts that can include various combinations of products and services, which may be capable of being distinct and accounted for as separate performance obligations, or as in the case of ~~offerings~~certain ~~such as~~ cloud-enabled ~~Creative~~software ~~Cloud~~subscription ~~and Document Cloud~~offerings, accounted for as a single performance obligation. Revenue is recognized net of allowances for returns and any taxes collected from customers, which are subsequently remitted to governmental authorities.

59Subscription, Product and Services Offerings

We enter into revenue arrangements in which a customer may purchase a combination of our products, services and/or solutions as described above. Certain revenue arrangements provide customers with unilateral cancellation rights, or options to either renew monthly on-premise term-based licenses or use committed funds to purchase other Adobe products or services.

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ADOBE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Subscription, Product and Services Offerings

Fully hosted subscription services (“SaaS”) allow customers to access hosted software during the contractual term without taking possession of the software. Cloud-hosted subscription services may be sold on a fee-per-subscription period basis or based on consumption or usage.

We recognize revenue ratably over the contractual service term, which typically ranges from 1 to 36 months, for hosted services that are priced based on a committed number of transactions where the delivery and consumption of the benefit of the services occur evenly over time, beginning on the date the services associated with the committed transactions are first made available to the customer and continuing through the end of the contractual service term. Over-usage fees and fees based on the actual number of transactions are billed in accordance with contract terms as these fees are incurred and are included in the transaction price of an arrangement as variable consideration. Fees based on a number of transactions, where invoicing is aligned to the pattern of performance, customer benefit and consumption, are typically accounted for utilizing the “as-invoiced” practical expedient. Revenue for subscriptions sold as a fee per period is recognized ratably over the contractual term as the customer simultaneously receives and consumes the benefit of the underlying service.

When cloud-enabled services are highly integrated and interrelated with on-premise/on-device software, ~~such as in our cloud-enabled Creative Cloud and Document Cloud offerings,~~ the individual components are not considered distinct and revenue is recognized ratably over the subscription period for which the cloud-enabled services are provided.

~~The~~Subscription-based consulting services and subscription support plans related to those customer arrangements whose revenues we classify as subscription revenues represent stand-ready performance obligations. Revenue from these ~~subscription~~service and support ~~plans~~offerings is recognized ratably over their respective contractual terms and classified as subscription revenue.

Licenses for on-premise software may be purchased on a perpetual basis, as a subscription for a fixed period of time, or based on usage for certain of our original equipment manufacturer (“OEM”) and royalty agreements. Revenue from non-cloud enabled on-premise licenses without unilateral cancellation rights or monthly renewal options is recognized at the point in time the software is available to the customer, provided all other revenue recognition criteria are met, and classified as product revenue on our Consolidated Statements of Income. Revenue from on-premise term license or term licensing arrangements with unilateral cancellation rights or monthly renewal options, and any associated maintenance and support, is classified as subscription revenue.

Our services and other revenue is comprised primarily of fees related to project-based consulting, and training, as well as maintenance and support for certain on-premise licenses that are recognized at a point in time and our advertising offerings. We ~~typically~~ sell our project-based consulting contracts on a time-and-materials or fixed-fee basis. These revenues are recognized as the services are performed for time-and-materials contracts and on a relative performance basis for fixed-fee contracts. Training revenues are recognized as the services are performed. Our maintenance and support offerings, which entitle customers, partners and developers to receive desktop product upgrades and enhancements or technical support, depending on the offering, are generally recognized ratably over the term of the arrangement. Our transaction-based advertising offerings, where fees are based on a number of impressions per month and invoicing is aligned to the pattern of performance, customer benefit and consumption, are typically accounted for utilizing the “as-invoiced” practical expedient.

Judgments

Our contracts with customers may include promises to transfer multiple ~~goods~~products and services. ~~For~~Determining ~~example,~~whether ~~some~~products and services are distinct performance obligations to be accounted for separately or combined as part of a single performance obligation may require significant judgment, primarily for our ~~offerings~~solutions that include both on-premise and/or on-device software licenses and cloud services. ~~Determining~~We ~~whether~~have ~~the~~concluded that certain subscription offerings, which include both on-premise/on-device software licenses and ~~the~~ cloud services, ~~are~~represent ~~distinct~~a ~~from each other~~single, ~~and~~highly ~~therefore~~integrated performance ~~obligations~~obligation. toThis beconclusion ~~accounted~~reflects ~~for~~the ~~separately~~high degree of integration, orinterdependency ~~not~~and ~~distinct~~interrelation ~~from~~between ~~each~~the ~~other,~~software and ~~therefore~~the ~~part~~cloud ofservices, asuch ~~single~~that ~~performance~~customers ~~obligation,~~receive ~~may~~the ~~require~~intended ~~significant~~benefit ~~judgment~~only when these components operate together. WeThe ~~have~~nature ~~concluded~~of ~~that~~our ~~the~~promise onto customers is to deliver a complete end-~~premise/on~~to-~~device~~end ~~software~~solution, ~~licenses~~ and ~~cloud~~the ~~services~~intended ~~provided~~functionality inand ~~our~~workflow ~~Creative~~efficiencies ~~Cloud~~cannot ~~and~~be ~~Document~~obtained ~~Cloud~~from ~~subscription~~either ~~offerings~~the ~~are~~software ~~not~~or ~~distinct~~the ~~from~~cloud ~~each~~services ~~other~~on ~~such~~a ~~that~~standalone ~~revenue~~basis. ~~from~~Accordingly, ~~each~~revenue ~~offering~~for ~~should~~these beofferings is recognized ratably over the subscription period ~~for~~during which the cloud services are provided. ~~In reaching this conclusion, we considered the nature of our~~

60Standalone selling price is established by maximizing the amount of observable inputs, primarily actual historical selling prices for performance obligations where available, and includes consideration of factors such as go-to-market model and

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ADOBE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

~~promise~~geography. toIndividual ~~Creative~~products ~~Cloud~~may ~~and~~have ~~Document~~multiple ~~Cloud~~values ~~customers,~~for ~~which~~standalone isselling toprice ~~provide~~depending aon ~~complete~~factors ~~end-to-end~~such ~~creative~~as ~~design or~~where ~~document~~they ~~workflow~~are ~~solution~~sold ~~that~~and ~~operates~~what ~~seamlessly~~channel ~~across~~they ~~multiple~~are ~~devices~~sold ~~and teams~~through. WeWhere ~~fulfill~~standalone ~~this~~selling ~~promise~~price bymay ~~providing~~not ~~access~~be todirectly aobservable ~~solution~~(e.g., ~~that~~the ~~integrates~~performance ~~cloud-based~~obligation ~~and~~is ~~on-premise/on-device~~not ~~features~~sold ~~that~~separately), ~~together~~we ~~through~~maximize ~~their~~the ~~integration,~~use ~~provide~~of ~~functionalities,~~observable ~~utility~~inputs ~~and~~by ~~workflow~~using ~~efficiencies~~information that ~~could~~may ~~not~~include bereviewing ~~obtained~~pricing ~~from~~practices, ~~either~~performance ~~the~~obligations ~~on-premise/on-device~~with ~~software~~similar orcustomers ~~cloud~~and ~~services~~selling ~~on their own~~models.

Standalone selling price is established by maximizing the amount of observable inputs, primarily actual historical selling prices for performance obligations where available, and includes consideration of factors such as go-to-market model and geography. Individual products may have multiple values for standalone selling price depending on factors such as where they are sold and what channel they are sold through. Where standalone selling price may not be directly observable (e.g., the performance obligation is not sold separately), we maximize the use of observable inputs by using information that may include reviewing pricing practices, performance obligations with similar customers and selling models.

Capitalized costs to obtain a contract are amortized over the expected period of benefit, which we have determined, based on analysis, to be 5 years. We evaluated qualitative and quantitative factors to determine the period of amortization, including contract length, renewals, customer life and the useful lives of our products and acquired products. When the expected period of benefit of an asset which would be capitalized is less than one year, we expense the amount as incurred, utilizing the practical expedient. We regularly evaluate whether there have been changes in the underlying assumptions and data used to determine the amortization period.

When revenue arrangements include components of third-party ~~goods~~products and services, for example in transactions which involve resale, fulfillment or providing advertising impressions to our end customer, we evaluate whether we are the principal, and report revenues on a gross basis, or an agent, and report revenues on a net basis. In this assessment, we consider if we obtain control of the specified ~~goods~~products or services before they are transferred to the customer by evaluating indicators such as which party is primarily responsible for fulfilling the promise to provide the ~~goods~~products or services, which party has discretion in establishing price and the underlying terms and conditions between the parties to the transaction.

We offer limited rights of return, rebates and price protection of our products under various policies and programs with our distributors, resellers and/or end-user customers. We estimate and record reserves for these programs as variable consideration when estimating transaction price. Returns, rebates and other offsets to transaction price are estimated at contract inception on a portfolio basis and assessed for reasonableness each reporting period when additional information becomes available.

General Contract Provisions

We maintain revenue reserves for rebates, rights of return and other limited price adjustments. Distributors are allowed limited rights of return of products purchased during the previous quarter. In addition, distributors are allowed to return products that have reached the end of their lives, as defined by us, and for products that are being replaced by new versions. We offer rebates to our distributors, resellers and/or end-user customers. Transaction price is reduced for these amounts based on actual performance against objectives set forth by us for a particular reporting period, such as volume and timely reporting.

On a quarterly basis, the amount of revenue that is reserved is calculated based on our historical trends and data specific to each reporting period. The primary method of establishing these reserves is to review historical data from prior periods as a percent of revenue to determine a historical reserve rate. We then apply the historical rate to the current period revenue as a basis for estimating future returns. When necessary, we also provide a specific reserve in excess of portfolio-level estimated requirements. This estimate can be affected by the amount of a particular product in the channel, the rate of sell-through, product plans and other factors.

61Although our subscription contracts are generally non-cancellable, a limited number of customers have the right to cancel their contracts by providing prior written notice to us of their intent to cancel the remainder of the contract term and consumers have a period of time to terminate certain agreements without penalty. In the event a customer cancels their contract, they are generally not entitled to a refund for prior services we have provided to them. Contracts that include termination rights without substantive penalty are accounted for as contracts only for the committed period. Periods of time after the right of termination are accounted for as optional purchases when they do not represent material rights. For certain of our usage-based license agreements, typically in our royalty and OEM businesses, reporting may be received after the end of a fiscal period. In such instances, we estimate and accrue license revenue. We base our estimates on multiple factors, including historical sales information, seasonality and other business information which may impact our estimates. We do not estimate variable consideration for our sales and usage-based license royalty agreements, consistent with the associated exception for sales and usage-based royalties for the license of intellectual property under the revenue recognition standard.

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ADOBE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Although our subscription contracts are generally non-cancellable, a limited number of customers have the right to cancel their contracts by providing prior written notice to us of their intent to cancel the remainder of the contract term and consumers have a period of time to terminate certain agreements without penalty. In the event a customer cancels their contract, they are generally not entitled to a refund for prior services we have provided to them. Contracts that include termination rights without substantive penalty are accounted for as contracts only for the committed period. Periods of time after the right of termination are accounted for as optional purchases when they do not represent material rights. For certain of our usage-based license agreements, typically in our royalty and OEM businesses, reporting may be received after the end of a fiscal period. In such instances, we estimate and accrue license revenue. We base our estimates on multiple factors, including historical sales information, seasonality and other business information which may impact our estimates. We do not estimate variable consideration for our sales and usage-based license royalty agreements, consistent with the associated exception for sales and usage-based royalties for the license of intellectual property under the revenue recognition standard.

Property and Equipment

We record property and equipment at cost less accumulated depreciation and amortization. Property and equipment are depreciated using the straight-line method over their estimated useful lives, generally as follows: 3 to 208 years for computers and other equipment, which includes our corporate jet, 5 years for furniture and fixtures, 15 years for building improvements and 35 years for buildings. Leasehold improvements are amortized using the straight-line method over the lesser of the remaining respective lease term or estimated useful life of the asset.

Leases

We determine if an arrangement is or contains a lease at contract inception. In certain of our lease arrangements, primarily those related to our data center arrangements, judgment is required in determining if a contract contains a lease. For these arrangements, there is judgment in evaluating if the arrangement involves an identified asset that is physically distinct or whether we have the right to substantially all of the capacity of an identified asset that is not physically distinct. In arrangements that involve an identified asset, there is also judgment in evaluating if we have the right to direct the use of that asset.

We do not have any finance leases. Operating leases are recorded in our Consolidated Balance Sheets. Right-of-use assets and lease liabilities are measured at the lease commencement date based on the present value of the remaining lease payments over the lease term, determined using the discount rate for the lease at the commencement date. Because the rate implicit in our leases is not readily determinable, we use our incremental borrowing rate as the discount rate, which approximates the interest rate at which we could borrow on a collateralized basis with similar terms and payments and in similar economic environments. Our lease terms include optional periods to extend or terminate the lease when it is reasonably certain that the option will be exercised. Operating lease expense is recognized on a straight-line basis over the lease term. We generally account for lease and non-lease components, principally common area maintenance for our facilities leases, as a single lease component for our facilities and data center leases.

In accordance with accounting requirements, leases with an initial term of 12 months or less are recorded on the balance sheet, with lease expense for these leases recognized on a straight-line basis over the lease term.

Goodwill, Intangibles and Other Long-Lived Assets

Goodwill is assigned to one or more reporting units on the date of acquisition. We review our goodwill for impairment annually during our second quarter of each fiscal year and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of any one of our reporting units below its respective carrying amount. In performing our goodwill impairment test, we first perform a qualitative assessment, which requires that we consider events or circumstances including macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, changes in management or key personnel, changes in strategy, changes in customers, changes in the composition or carrying amount of a reporting unit’s net assets and changes in our stock price. If, after assessing the totality of events or circumstances, we determine that it is more likely than not that the fair values of our reporting units are greater than the carrying amounts, then the quantitative goodwill impairment test is not performed.

62If the qualitative assessment indicates that the quantitative analysis should be performed, we then evaluate goodwill for impairment by comparing the fair value of each of our reporting units to its carrying value, including the associated goodwill. To determine the fair values, we use the equal weighting of the market approach based on comparable publicly traded companies in similar lines of businesses and the income approach based on estimated discounted future cash flows. Our cash flow assumptions consider historical and forecasted revenue, operating costs and other relevant factors.

We amortize intangible assets with finite lives over their estimated useful lives and review them for impairment whenever an impairment indicator exists. Amortization is based on the pattern in which the economic benefits of the intangible asset will be consumed or on a straight-line basis when the consumption pattern is not apparent.

We continually monitor events and changes in circumstances that could indicate that the carrying amounts of our long-lived assets, including our property and equipment, leases and intangible assets, may not be recoverable. When such events or changes in circumstances occur, we assess recoverability by determining whether the carrying value of such assets will be recovered through the undiscounted expected future cash flows. If the future undiscounted cash flows are less than the carrying

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Ifamount ~~the~~of ~~qualitative~~these ~~assessment indicates that the quantitative analysis should be performed~~assets, we ~~then~~recognize ~~evaluate~~an ~~goodwill for~~ impairment byloss ~~comparing~~based ~~the~~on ~~fair~~any ~~value~~excess of ~~each~~the ~~of our reporting units to its~~ carrying ~~value,~~amount ~~including~~over the ~~associated goodwill. To determine the~~ fair ~~values,~~value ~~we use the equal weighting~~ of the ~~market approach based on comparable publicly traded companies in similar lines of businesses and the income approach based on estimated discounted future cash flows~~assets. ~~Our cash flow assumptions consider historical and forecasted revenue, operating costs and other relevant factors.~~

Income Taxes

Our assumptions, judgments and estimates relative to the current provision for income taxes take into account our interpretation and application of current tax laws and possible outcomes of current and future examinations conducted by domestic and foreign tax authorities. We have established reserves for income taxes to address potential exposures involving tax positions that could be challenged by tax authorities. We regularly assess the likelihood of outcomes resulting from these examinations to determine the adequacy of our provision for income taxes and associated reserves. Our policy is to record interest and penalties related to unrecognized tax benefits in income tax expense.

Taxes Collected from Customers

We net taxes collected from customers against those remitted to government authorities in our financial statements. Accordingly, taxes collected from customers are not reported as revenue.

Treasury Stock

Prepayments made for repurchases of our common stock are classified as treasury stock on our Consolidated Balance Sheets and only shares physically delivered to us by each period end are excluded from the computation of net income per share.

We account for treasury stock under the cost method. When treasury stock is re-issued at a price higher than its cost, the difference is recorded as a component of additional paid-in capital in our Consolidated Balance Sheets. When treasury stock is re-issued at a price lower than its cost, the difference is recorded as a component of additional paid-in capital to the extent that there are previously recorded gains to offset the losses. If there are no treasury stock gains in additional paid-in capital, the losses upon re-issuance of treasury stock are recorded as a reduction of retained earnings in our Consolidated Balance Sheets.

Advertising Expenses

Advertising costs are expensed as incurred. Advertising expenses for fiscal ~~2024~~2025, ~~2023~~2024 and ~~2022~~2023 were $1.0437 billion, $~~970~~1.04 ~~million~~billion and $~~1.04~~970 ~~billion~~million, respectively.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Foreign Currency Translation

We translate assets and liabilities of foreign subsidiaries, whose functional currency is their local currency, at exchange rates in effect at the balance sheet date. We translate revenue and expenses at the monthly average exchange rates. We include accumulated net translation adjustments in stockholders’ equity as a component of accumulated other comprehensive income (loss).

Derivative Financial Instruments

In countries outside the United States, we transact business in U.S. Dollars and in various other currencies. We may use foreign exchange forward contracts and option contracts to hedge a portion of our forecasted foreign currency denominated revenue and expenses primarily in Euros, Japanese Yen, British Pounds, Indian Rupees, Australian Dollars and Canadian Dollars. Additionally, we hedge our net recognized foreign currency monetary assets and liabilities with foreign exchange forward contracts to reduce the risk that our earnings and cash flows will be adversely affected by changes in exchange rates.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

We recognize all derivative instruments as either assets or liabilities in our Consolidated Balance Sheets and measure them at fair value. Gains and losses resulting from changes in fair value are accounted for depending on the use of the derivative and whether it is designated and qualifies for hedge accounting. Contracts that do not qualify for hedge accounting are adjusted to fair value through earnings.

Gains and losses related to changes in the fair value of foreign exchange forward contracts which hedge certain balance sheet positions are recorded each period as a component of other income (expense), net in our Consolidated Statements of Income. Foreign exchange forward contracts and option contracts hedging forecasted foreign currency revenue and expenses and Treasury lock agreements are designated as cash flow hedges with gains and losses recorded net of tax as a component of accumulated other comprehensive income (loss) in our Consolidated Balance Sheets until the forecasted transaction occurs. When the forecasted transaction affects earnings, we reclassify the related gain or loss on the foreign currency revenue, foreign currency expense or Treasury lock cash flow hedge to revenue, operating expense or interest expense, as applicable.

Concentration of Risk

Financial instruments that potentially subject us to concentrations of credit risk are short-term fixed-income investments, structured repurchase transactions, foreign currency and interest rate hedge contracts and trade receivables.

Our investment portfolio consists of investment-grade securities diversified among security types, industries and issuers. Our cash and investments are held and primarily managed by recognized financial institutions that follow our investment policy. Our policy limits the amount of credit exposure to any one security issue or issuer and we believe no significant concentration of credit risk exists with respect to these investments.

We enter into master netting arrangements to mitigate credit risk in derivative transactions by permitting net settlement of transactions with the same counterparty. We also enter into collateral security agreements with certain of our counterparties to exchange cash collateral when the net fair value of certain derivative instruments fluctuates from contractually established thresholds.

Credit risk in receivables is limited to OEMs, dealers and distributors of hardware and software products to the retail market, customers to whom we license software directly and our SaaS offerings. A credit review is completed for our new distributors, dealers and OEMs. We also perform ongoing credit evaluations of our customers’ financial condition and require letters of credit or other guarantees, whenever deemed necessary. The credit limit given to the customer is based on our risk assessment of their ability to pay, country risk and other factors and is not contingent on the resale of the product or on the collection of payments from their customers. Certain contracts with advertising agencies contain sequential liability provisions, under which the agency is not required to pay until payment is received from the agency’s customers. In these circumstances, we evaluate the credit-worthiness of the agency’s customers in addition to the agency itself. If we license our software or provide SaaS services to a customer where we have a reason to believe the customer’s ability and intention to pay is not probable, the arrangement is not considered to be a revenue contract. Accordingly, we will not recognize any consideration received as revenue until termination or substantive completion of the services.

64Recently Adopted Accounting Guidance

In November 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. Beginning with our annual reporting for fiscal 2025, we adopted the updated standard on a retrospective basis. The adoption of this standard did not have a material impact on our Consolidated Financial Statements and related disclosures. See Note 2 for further information regarding our reportable segments.

There have been no other new accounting pronouncements made effective during fiscal 2025 that have significance, or potential significance, to our Consolidated Financial Statements and related disclosures.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Recent Accounting Pronouncements Not Yet Effective

In November 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The updated standard is effective for our annual periods beginning in fiscal 2025 and interim periods beginning in the first quarter of fiscal 2026. Early adoption is permitted. We are currently evaluating the impact that the updated standard will have on our financial statement disclosures.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes, which prescribes standardized categories and disaggregation of information in the reconciliation of provision for income taxes, requires disclosure of disaggregated income taxes paid, and modifies other income tax-related disclosure requirements. The updated standard is effective for us beginning with our fiscal year 2026 annual reporting period. Early adoption is permitted. We are currently evaluating the impact that the updated standard will have on our financial statement disclosures.

In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, which requires additional disclosure of certain costs and expenses within the notes to the financial statements. The updated standard is effective for our annual periods beginning in fiscal 2028 and interim periods beginning in the first quarter of fiscal 2029. Early adoption is permitted. We are currently evaluating the impact that the updated standard will have on our financial statement disclosures.

~~There~~In ~~have~~September ~~been~~2025, nothe ~~other~~FASB ~~recent~~issued ~~accounting~~ASU ~~pronouncements~~No. 2025-06, ~~changes~~Intangibles—Goodwill inand ~~accounting~~Other—Internal-Use ~~pronouncements~~Software, orwhich ~~recently~~modernizes ~~adopted~~the accounting ~~guidance~~for ~~during~~internal-use software and clarifies capitalization criteria. The updated standard is effective for us beginning with our interim and annual reporting periods of fiscal ~~2024~~2029. ~~that~~Early adoption is permitted. We are ofcurrently ~~significance~~evaluating orthe ~~potential~~impact ~~significance~~that tothe usupdated standard will have on our Consolidated Financial Statements.

There have been no other recent accounting pronouncements or changes in accounting pronouncements during fiscal 2025 that are of significance or potential significance to us.

NOTE 2. REVENUE

Segment Information

We report segment information based on the “management” approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of our reportable segments.

Our Chief Executive Officer, the company’s chief operating decision maker (“CODM”), reviews revenue and gross margin information for each of our ~~reportable~~ segments, ~~but~~to ~~does~~assess ~~not~~segment ~~review~~performance ~~operating~~and ~~expenses~~allocate onresources. aSegment ~~segment~~revenue and gross margin information is primarily reviewed by ~~segment~~comparing ~~basis~~actual results to prior period results. InOur ~~addition,~~CODM ~~with~~does ~~the~~not ~~exception~~review individual significant costs within segment cost of ~~goodwill~~revenue to assess performance, weand doalso does not ~~identify~~review operating expense or ~~allocate~~asset ~~our~~information ~~assets~~on bya ~~the~~segment ~~reportable~~by ~~segments~~segment basis.

~~Our~~During fiscal 2025, our business iswas organized into the following reportable segments:

•Digital Media—Our Digital Media segment provides products and services that enable individuals, teams, businesses, and enterprises to create, publish and promote their content anywhere and accelerate their productivity by transforming how they view, share, engage with and collaborate on documents and creative content. Our customers ~~include~~span creative professionals, including graphic designers, photographers, ~~video editors~~videographers, ~~graphic~~illustrators and ~~experience~~3D ~~designers~~artists; ~~and~~creators, ~~game~~including ~~developers~~social media influencers and solopreneurs; ~~communicators~~business professionals, including ~~content~~social ~~creators,~~media ~~students~~teams, ~~marketers~~small business owners and knowledge workers; and consumers.

•Digital Experience—Our Digital Experience segment provides marketing professionals with an integrated platform and set of products, services and solutions that enable businesses to create, manage, execute, measure, monetize and optimize customer experiences that span from analytics to commerce. Our customers include marketers, advertisers, ~~agencies~~brand managers, ~~publishers~~campaign strategists, merchandisers, merchants, ~~web~~data analysts, ~~data scientists,~~ developers and executives across the C-suite.

6558

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Our segment ~~revenue and~~ results for fiscal ~~2024~~2025, ~~2023~~2024 and ~~2022~~2023 were as follows:

(dollars in millions)	Digital Media			Digital Experience			Publishing and Advertising			Total
Fiscal 2025
Revenue	$	17,649		$	5,864		$	256		$	23,769
Cost of revenue	841			1,625			85			2,551
Gross profit	$	16,808		$	4,239		$	171		$	21,218
Gross profit as a percentage of revenue	95 %		%	72 %		%	67 %		%	89 %		%
Fiscal 2024
Revenue	$	15,864		$	5,366		$	275		$	21,505
Cost of revenue	680			1,589			89			2,358
Gross profit	$	15,184		$	3,777		$	186		$	19,147
Gross profit as a percentage of revenue	96 %		%	70 %		%	68 %		%	89 %		%
Fiscal 2023
Revenue	$	14,216		$	4,893		$	300		$	19,409
Cost of revenue	665			1,603			86			2,354
Gross profit	$	13,551		$	3,290		$	214		$	17,055
Gross profit as a percentage of revenue	95 %		%	67 %		%	71 %		%	88 %		%
Fiscal 2022
Revenue	$	12,842		$	4,422		$	342		$	17,606
Cost of revenue	561			1,502			102			2,165
Gross profit	$	12,281		$	2,920		$	240		$	15,441
Gross profit as a percentage of revenue	96		%	66		%	70		%	88		%

WeSee ~~generally categorize revenue by geographic area based on where~~ the ~~customer~~Consolidated ~~manages~~Statements ~~their utilization~~ of ~~our~~Income ~~offerings.~~for ~~Revenue~~a byreconciliation ~~geographic~~of ~~area~~consolidated ~~for~~gross ~~fiscal~~profit ~~2024,~~to ~~2023~~consolidated ~~and~~income ~~2022~~before ~~were~~income ~~as follows:~~taxes.

(in millions)	2024		2023		2022
Americas:
United States	$	11,499	$	10,460	$	9,217
Other	1,392		1,194		1,034
Total Americas	12,891		11,654		10,251
EMEA	5,554		4,881		4,593
APAC	3,060		2,874		2,762
Revenue	$	21,505	$	19,409	$	17,606

We generally categorize revenue by geographic area based on where the customer manages their utilization of our offerings. Revenue by geographic area for fiscal 2025, 2024 and 2023 were as follows:

Revenue by major offerings in our Digital Media reportable segment for fiscal 2024, 2023 and 2022 were as follows:


(in millions)	2025		2024		2023
Americas:
United States	$	12,529	$	11,499	$	10,460
Other	1,591		1,392		1,194
Total Americas	14,120		12,891		11,654



EMEA	6,289		5,554		4,881



APAC	3,360		3,060		2,874
Revenue	$	23,769	$	21,505	$	19,409

(in millions)	2024		2023		2022
Creative Cloud	$	12,682	$	11,517	$	10,459
Document Cloud	3,182		2,699		2,383
Total Digital Media revenue	$	15,864	$	14,216	$	12,842

Subscription revenue by segment for fiscal 2025, 2024 and 2023 were as follows:

Subscription revenue by segment for fiscal 2024, 2023 and 2022 were as follows:


(in millions)	2025		2024		2023
Digital Media	$	17,389	$	15,547	$	13,838
Digital Experience	5,409		4,864		4,331
Publishing and Advertising	106		110		115
Total subscription revenue	$	22,904	$	20,521	$	18,284

(in millions)	2024		2023		2022
Digital Media	$	15,547	$	13,838	$	12,385
Digital Experience	4,864		4,331		3,880
Publishing and Advertising	110		115		123
Total subscription revenue	$	20,521	$	18,284	$	16,388

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Digital Media and Digital Experience subscription revenue by customer group for fiscal 2025, 2024 and 2023 were as follows:


(in millions)	2025		2024		2023
Creative & Marketing Professionals	$	16,303	$	14,749	$	13,425
Business Professionals & Consumers	6,495		5,662		4,744
Total Digital Media and Digital Experience subscription revenue	$	22,798	$	20,411	$	18,169

Contract Balances

Trade Receivables

A receivable is recorded when an unconditional right to invoice and receive payment exists, such that only the passage of time is required before payment of consideration is due. Timing of revenue recognition may differ from the timing of invoicing to customers. Certain performance obligations may require payment before delivery of the license or service to the customer. Included in trade receivables on the Consolidated Balance Sheets are unbilled receivable balances which have not yet been invoiced, and are typically related to license revenue or services which are delivered prior to invoicing. As of November 2928, ~~2024~~2025, the balance of trade receivables, net of allowances for doubtful accounts, was $2.0734 billion, inclusive of unbilled receivables of $6674 million. As of ~~December~~November 129, ~~2023~~2024, the balance of trade receivables, net of allowances for doubtful accounts, was $2.2207 billion, inclusive of unbilled receivables of $8066 million.

Allowance for Doubtful Accounts

We maintain an allowance for doubtful accounts which reflects our best estimate of potentially uncollectible trade receivables and is based on both specific and general reserves. We maintain general reserves on a collective basis by considering factors such as historical experience, credit-worthiness, the age of the trade receivable balances, current economic conditions and a reasonable and supportable forecast of future economic conditions. The allowance for doubtful accounts was $1413 million and $1614 million as of November 2928, ~~2024~~2025 and ~~December~~November 129, ~~2023~~2024, respectively.

Contract Assets

A contract asset is recognized when a conditional right to consideration exists and transfer of control has occurred. Contract assets are typically related to subscription and hosted service contracts where the transaction price allocated to the satisfied performance obligations exceeds the value of billings to date. Contract assets are included in prepaid expenses and other current assets for the current portion and other assets for the long-term portion on the Consolidated Balance Sheets. We regularly review contract asset balances for impairment, considering factors such as historical experience, credit-worthiness, age of the balance, current economic conditions and a reasonable and supportable forecast of future economic conditions. Contract asset impairments were not material in fiscal ~~2024~~2025 and ~~2023~~2024. Contract assets were $~~248~~241 million and $~~141~~248 million as of November 2928, ~~2024~~2025 and ~~December~~November 129, ~~2023~~2024, respectively.

Deferred Revenue and Remaining Performance Obligations

Deferred revenue primarily consists of billings or payments received in advance of revenue recognition from subscription services, including non-cancellable and non-refundable committed funds and refundable customer deposits. Deferred revenue is recognized as revenue when transfer of control to customers has occurred. Customers are typically invoiced for these agreements in regular installments and revenue is recognized ratably over the contractual subscription period. The deferred revenue balance is influenced by several factors, including the compounding effects of renewals, invoice duration, invoice timing, size and new business linearity within the quarter. Deferred revenue does not represent the total contract value of annual or multi-year non-cancellable subscription agreements.

Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 to 60 days. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined our contracts generally do not include a significant financing component. The primary purpose of our invoicing terms is to provide customers with simplified and predictable ways of purchasing our products and services, such as invoicing at the beginning of a subscription term with revenue recognized ratably over the contract period, and not to receive financing from our customers. Any potential financing fees are considered insignificant in the context of our contracts.

As of November 29, 2024, the balance of deferred revenue was $6.26 billion, which includes $83 million of refundable customer deposits. Refundable customer deposits represent arrangements in which the customer has a unilateral cancellation right for which we are obligated to refund amounts paid related to products or services not yet delivered or provided at the time of cancellation on a prorated basis. Arrangements with some of our enterprise customers with non-cancellable and non-refundable committed funds provide options to either renew monthly on-premise term-based licenses or use some or all funds to purchase other Adobe products or services. Non-cancellable and non-refundable committed funds related to these agreements comprised approximately 4% of the total deferred revenue. 60

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Asbeginning of ~~December 1,~~a ~~2023,~~subscription ~~the~~term ~~balance~~with ~~of deferred~~ revenue ~~was~~recognized ~~$5.95~~ratably ~~billion.~~over ~~Significant movements in~~ the ~~deferred~~contract ~~revenue balance during the~~ period ~~consisted of increases due to payments received prior to transfer of control of the underlying performance obligations to the customer~~, ~~which~~and ~~were~~not ~~offset by decreases due~~ to ~~revenue~~receive ~~recognized~~financing infrom ~~the~~our ~~period~~customers. ~~During~~Any ~~the~~potential ~~year~~financing ~~ended~~fees ~~November 29,~~are ~~2024,~~considered ~~approximately~~insignificant ~~$5.87 billion of revenue was recognized that was included~~ in the ~~balance~~context of ~~deferred~~our ~~revenue as of December 1, 2023~~contracts.

As of November 28, 2025, the balance of deferred revenue was $7.03 billion, which includes $80 million of refundable customer deposits. Refundable customer deposits represent arrangements in which the customer has a unilateral cancellation right for which we are obligated to refund amounts paid related to products or services not yet delivered or provided at the time of cancellation on a prorated basis. Arrangements with some of our enterprise customers with non-cancellable and non-refundable committed funds provide options to either renew monthly on-premise term-based licenses or use some or all funds to purchase other Adobe products or services. Non-cancellable and non-refundable committed funds related to these agreements comprised approximately 4% of the total deferred revenue.

As of November 29, 2024, the balance of deferred revenue was $6.26 billion. Significant movements in the deferred revenue balance during the period consisted of increases due to payments received prior to transfer of control of the underlying performance obligations to the customer, which were offset by decreases due to revenue recognized in the period. During the year ended November 28, 2025, approximately $6.14 billion of revenue was recognized that was included in the balance of deferred revenue as of November 29, 2024.

Transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and unbilled amounts that will be recognized as revenue in future periods. Transaction price allocated to remaining performance obligations is influenced by several factors, including the timing of renewals and average contract term. We applied practical expedients to exclude amounts related to performance obligations that are billed and recognized as they are delivered, optional purchases that do not represent material rights, sales and usage-based royalties not yet consumed and any estimated amounts of variable consideration that are subject to constraint.

Remaining performance obligations were approximately $1922.9652 billion as of November 2928, ~~2024~~2025. Non-cancellable and non-refundable committed funds related to some of our enterprise customer agreements referred to in the paragraph above comprised approximately 4% of the total remaining performance obligations. Approximately 6765% of the remaining performance obligations, excluding the aforementioned enterprise customer agreements, are expected to be recognized over the next 12 months with the remainder recognized thereafter.

Contract Acquisition Costs

We recognize an asset for the incremental costs of obtaining a contract with a customer if we expect the benefit of those costs to be longer than one year. We have determined that certain sales incentive programs meet the requirements to be capitalized.

The costs capitalized are primarily sales commissions paid to our sales force personnel. Capitalized costs may also include portions of fringe benefits and payroll taxes associated with compensation for incremental costs to acquire customer contracts and incentive payments to partners.

Capitalized costs to obtain a contract are amortized over the expected period of benefit, which we have determined, based on analysis, to be 5 years. Amortization of capitalized costs are included in sales and marketing expense in our Consolidated Statements of Income. During fiscal ~~2024~~2025, ~~2023~~2024 and ~~2022~~2023, we amortized $~~272~~282 million, $~~254~~272 million and $~~238~~254 million of capitalized contract acquisition costs into sales and marketing expense, respectively. We did not incur any impairment losses for all periods presented.

Capitalized contract acquisition costs were $~~717~~721 million and $~~656~~717 million as of November 2928, ~~2024~~2025 and ~~December~~November 129, ~~2023~~2024, of which $464 million ~~and $422 million~~ was long-term and included in other assets in the Consolidated Balance Sheets, ~~respectively~~for both periods. The remaining balance of the capitalized costs to obtain contracts was current and included in prepaid expenses and other current assets.

Refund Liabilities

We record refund liabilities for amounts that may be subject to future refunds, which include sales returns reserves and customer rebates and credits. Refund liabilities are included in accrued expenses onand ~~the~~other ~~Consolidated~~current ~~Balance Sheets. Refund~~ liabilities ~~were~~on ~~$141~~the ~~million and $111 million as of November 29, 2024 and December 1, 2023, respectively.~~

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ADOBE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Consolidated Balance Sheets. Refund liabilities were $137 million and $141 million as of November 28, 2025 and November 29, 2024, respectively.

Significant Customers

For all periods presented, there were no customers that represented at least 10% of net revenue or that were responsible for over 10% of our trade receivables.

68NOTE 3. CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS

Cash equivalents consist of highly liquid marketable securities with remaining maturities of three months or less at the date of purchase. We classify our investments in marketable debt securities as “available-for-sale.” We carry these investments at fair value, based on quoted market prices or other readily available market information. Unrealized gains and unrealized non-credit-related losses of marketable debt securities are included in accumulated other comprehensive income (loss), net of taxes, in our Consolidated Balance Sheets. Unrealized credit-related losses are recorded to other income (expense), net in our Consolidated Statements of Income with a corresponding allowance for credit-related losses in our Consolidated Balance Sheets. Gains and losses are determined using the specific identification method and recognized when realized in our Consolidated Statements of Income.

Cash, cash equivalents and short-term investments consisted of the following as of November 28, 2025:


(in millions)	Amortized Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value
Current assets:
Cash	$	711	$	—	$	—	$	711
Cash equivalents:
Corporate debt securities	928		—		—		928
Money market funds	3,607		—		—		3,607

Time deposits	85		—		—		85

U.S. Treasury securities	100		—		—		100
Total cash equivalents	4,720		—		—		4,720
Total cash and cash equivalents	5,431		—		—		5,431
Short-term fixed income securities:

Corporate debt securities	914		—		—		914




U.S. Treasury securities	250		—		—		250
Total short-term investments	1,164		—		—		1,164
Total cash, cash equivalents and short-term investments	$	6,595	$	—	$	—	$	6,595

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ADOBE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 3. ACQUISITIONS

Figma

On September 15, 2022, we entered into a definitive merger agreement under which we intended to acquire Figma, Inc. (“Figma”) for approximately $20 billion, comprised of approximately half cash and half stock.

On December 17, 2023, we entered into a mutual termination agreement with Figma to terminate the proposed merger. In accordance with the terms of the termination agreement, we paid Figma a termination fee of $1 billion. The termination fee was recorded in operating expenses in our Consolidated Statements of Income during fiscal 2024, and was not tax-deductible for financial statement purposes.

NOTE 4. CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS

Cash equivalents consist of highly liquid marketable securities with remaining maturities of three months or less at the date of purchase. We classify our investments in marketable debt securities as “available-for-sale.” We carry these investments at fair value, based on quoted market prices or other readily available market information. Unrealized gains and unrealized non-credit-related losses of marketable debt securities are included in accumulated other comprehensive income, net of taxes, in our Consolidated Balance Sheets. Unrealized credit-related losses are recorded to other income (expense), net in our Consolidated Statements of Income with a corresponding allowance for credit-related losses in our Consolidated Balance Sheets. Gains and losses are determined using the specific identification method and recognized when realized in our Consolidated Statements of Income.

Cash, cash equivalents and short-term investments consisted of the following as of November 29, 2024:


(in millions)	Amortized Cost		Unrealized Gains		Unrealized Losses		Estimated Fair Value
Current assets:
Cash	$	787	$	—	$	—	$	787
Cash equivalents:
Corporate debt securities	41		—		—		41
Money market funds	6,726		—		—		6,726

Time deposits	57		—		—		57
U.S. Treasury securities	2		—		—		2
Total cash equivalents	6,826		—		—		6,826
Total cash and cash equivalents	7,613		—		—		7,613
Short-term fixed income securities:
Asset-backed securities	4		—		—		4
Corporate debt securities	120		—		—		120



U.S. agency securities	11		—		—		11
U.S. Treasury securities	139		—		(1)		138
Total short-term investments	274		—		(1)		273
Total cash, cash equivalents and short-term investments	$	7,887	$	—	$	(1)	$	7,886

69See Note 4 for further information regarding the fair value of our financial instruments.

The following table summarizes the estimated fair value of short-term fixed income debt securities classified as short-term investments based on stated effective maturities as of November 28, 2025:


(in millions)	Estimated Fair Value
Due within one year	$	1,063
Due between one and two years	101


Total	$	1,164

We review our debt securities classified as short-term investments on a regular basis for impairment. For debt securities in unrealized loss positions, we determine whether any portion of the decline in fair value below the amortized cost basis is due to credit-related factors if we neither intend to sell nor anticipate that it is more likely than not that we will be required to sell prior to recovery of the amortized cost basis. We consider factors such as the extent to which the market value has been less than the cost, any noted failure of the issuer to make scheduled payments, changes to the rating of the security and other relevant credit-related factors in determining whether or not a credit loss exists. During fiscal 2025 and 2024, we did not recognize an allowance for credit-related losses on any of our investments.

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ADOBE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

~~Cash,~~NOTE ~~cash~~4. FAIR ~~equivalents~~VALUE ~~and short-term investments consisted of the following as of December 1, 2023:~~MEASUREMENTS

(in millions)	AmortizedCost		UnrealizedGains		UnrealizedLosses		EstimatedFair Value
Current assets:
Cash	$	618	$	—	$	—	$	618
Cash equivalents:
Money market funds	6,498		—		—		6,498
Time deposits	25		—		—		25
Total cash equivalents	6,523		—		—		6,523
Total cash and cash equivalents	7,141		—		—		7,141
Short-term fixed income securities:
Asset-backed securities	15		—		—		15
Corporate debt securities	438		—		(4)		434
U.S. agency securities	13		—		(1)		12
U.S. Treasury securities	247		—		(7)		240
Total short-term investments	713		—		(12)		701
Total cash, cash equivalents and short-term investments	$	7,854	$	—	$	(12)	$	7,842

Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis

~~See~~The ~~Note~~fair 5value ~~for~~of ~~further~~our ~~information~~financial ~~regarding~~assets ~~the~~and ~~fair~~liabilities ~~value~~at ofNovember 28, ~~our~~2025 ~~financial~~was ~~instruments.~~determined using the following inputs:

The following table summarizes the estimated fair value of short-term fixed income debt securities classified as short-term investments based on stated effective maturities as of November 29, 2024:


(in millions)	Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
Assets:
Cash equivalents:
Corporate debt securities	$	928	$	—	$	928	$	—
Money market funds	3,607		3,607		—		—

Time deposits	85		85		—		—

U.S. Treasury securities	100		—		100		—
Short-term investments:

Corporate debt securities	914		—		914		—




U.S. Treasury securities	250		—		250		—
Prepaid expenses and other current assets:
Foreign currency derivatives	62		—		62		—
Interest rate swap derivatives	2		—		2		—
Other assets:
Deferred compensation plan assets	342		342		—		—
Foreign currency derivatives	22		—		22		—
Interest rate swap derivatives	92		—		92		—
Total assets	$	6,404	$	4,034	$	2,370	$	—

(in millions)			EstimatedFair Value
Liabilities:
Due within one year			$	269
Accrued expenses and other current liabilities:
Due between one and two years			4
Foreign currency derivatives	$	94	$	—	$	94	$	—
Total			$	273
Interest rate swap derivatives	8		—		8		—
Other liabilities:
Foreign currency derivatives	6		—		6		—
Total liabilities	$	108	$	—	$	108	$	—

We review our debt securities classified as short-term investments on a regular basis for impairment. For debt securities in unrealized loss positions, we determine whether any portion of the decline in fair value below the amortized cost basis is due to credit-related factors if we neither intend to sell nor anticipate that it is more likely than not that we will be required to sell prior to recovery of the amortized cost basis. We consider factors such as the extent to which the market value has been less than the cost, any noted failure of the issuer to make scheduled payments, changes to the rating of the security and other relevant credit-related factors in determining whether or not a credit loss exists. During fiscal 2024 and 2023, we did not recognize an allowance for credit-related losses on any of our investments. 64

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ADOBE INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTE 5. FAIR VALUE MEASUREMENTS

Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis

The fair value of our financial assets and liabilities at November 29, 2024 was determined using the following inputs:


(in millions)	Fair Value Measurements at Reporting Date Using
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	Total		(Level 1)		(Level 2)		(Level 3)
Assets:
Cash equivalents:
Corporate debt securities	$	41	$	—	$	41	$	—
Money market funds	6,726		6,726		—		—
Time deposits	57		57		—		—
U.S. Treasury securities	2		—		2		—
Short-term investments:
Asset-backed securities	4		—		4		—
Corporate debt securities	120		—		120		—


U.S. agency securities	11		—		11		—
U.S. Treasury securities	138		—		138		—
Prepaid expenses and other current assets:
Foreign currency derivatives	105		—		105		—
Other assets:

Filing Compare · ADOBE INC.