Still growing. Still buying back shares.
The original buying thesis is still playing out: Adobe is growing, generating cash and buying back stock. Q3 supports keeping that thesis intact. Margins softened, so this is evidence of resilience—not a declaration that the AI threat is over.
What did the company report?
- The subscriptions are still growing.
Revenue was $6.76bn, up 13% year over year (12% in constant currency). Creative & Marketing subscriptions grew 13%; Business & Consumer grew 16%. These figures include acquisitions.
- Cash is funding the repurchases.
Operating cash flow of $2.523bn less $85m of capital spending gives $2.438bn in free cash flow, before stock-compensation adjustments. Cash spent on repurchases: $2.232bn.
- The smaller share count is doing its job.
Quarterly diluted weighted-average shares fell 6.7%, from 424.1m to 395.5m. Net income grew about 3%; diluted EPS grew about 11%. Fewer shares amplified per-share earnings.
- Margins are the yellow flag.
GAAP operating margin fell from 36.3% to 34.8%, calculated from reported figures. Revenue growth still needs to translate into durable cash generation.
What shifted in the view?
Thesis intact. The original buying thesis is still playing out: Adobe is growing, generating cash and buying back stock. Q3 supports keeping that thesis intact. Margins softened, so this is evidence of resilience—not a declaration that the AI threat is over.
Watch next
- Does subscription growth keep converting into cash after investment and employee equity pay?
- Do repurchases keep reducing the net share count at sensible prices?
Which inputs moved?
No model inputs changed. Q3 guidance and buybacks were already incorporated on September 12. We reviewed the September 22 filing and kept the operating assumptions and dated quote. No valuation increase.
Edition reviewed: 2026-09-12-buybacks.
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