Adobe Q2 2025 Earnings Preview: Low expectations set up potential upside

Adobe (NASDAQ:ADBE) is scheduled to announce Q2 earnings results on Thursday, June 12th, after market close.

Wall Street, on average, expects the information technology company to post a quarterly EPS of $4.97 (+10.9% Y/Y) on $5.8B (+9.2% Y/Y). The company expects second-quarter revenue to be between $5.77B and $5.82B and adjusted EPS in the range of $4.95 to $5.00.

In the first quarter, Adobe delivered a better-than-expected earnings report.

Analysts from Morgan Stanley commented, “investor concerns on Adobe’s long-term competitive positioning and near-term GenAI contribution continue to weigh on shares, which underperformed large-cap software peers by ~15 percentage points over the last three months. Low expectations paired with the potential for net new annual recurring revenue in Adobe’s Digital Media segment creates a compelling risk versus reward scenario.”

Meanwhile, Jefferies said Adobe’s 7% price increase to Creative Cloud should limit downside during the full fiscal year 2025 and provide upside during fiscal 2026.

“Despite recent underperformance, Adobe’s current valuation and intrinsic value analysis suggest the stock is now undervalued and a better buy than in recent years,” pointed out a recent Seeking Alpha analysis.

Over the last 2 years, ADBE has beaten EPS estimates 100% of the time and has beaten revenue estimates 100% of the time.

Over the last 3 months, EPS estimates have seen 7 upward revisions and 20 downward. Revenue estimates have seen 11 upward revisions and 12 downward.

Since the start of the year, ADBE shares have fallen 6.6%, compared to a 2.7% rise in the broader S&P 500 index (SP500).

Seeking Alpha’s Quant recommended the stock as a Hold while the Wall Street analysts see the company as a Buy.