Adobe’s Optimistic Forecast For New AI Tech Infused Products Attract Investor Cheer, Stock Soars

Software giant Adobe Inc’s (NASDAQ:ADBI) shares are trading higher in premarket on Friday.

Adobe is poised to experience its largest stock surge in nearly four years, following an optimistic sales forecast for its creative products infused with new AI technology.

This positive projection comes as Adobe reports a greater adoption of its innovative AI tools.

For the third quarter, Adobe anticipates its digital media net new annual recurring revenue to hit $460 million, surpassing the average forecast of $435.2 million.

Despite recent concerns among investors that generative AI technology might diminish its market share, Adobe’s integration of AI into its flagship products appears to be resonating with its customer base.

This shift has allowed Adobe to maintain a competitive edge against major software companies like Salesforce Inc. (NYSE:CRM) and ServiceNow Inc. (NYSE:NOW) and agile startups focusing on AI, Bloomberg reports.

Also Read: Adobe Boosts Generative AI Offerings With Latest Move

Adobe’s stock surged by about 15% in premarket trading today, indicating a significant market response to its strategic direction.

This jump could mark the biggest intraday rise since March 2020.

Amid a turbulent year, Adobe has raised its fiscal-year profit forecast up to $18.20 per share, an adjustment from its earlier estimate of $18.

The company reported a 10% increase in sales, amounting to $5.31 billion in the fiscal second quarter.

Adobe’s proprietary AI model, Firefly, has been integrated into several products, including Photoshop and Illustrator, and is now being developed for Premiere, its video-editing software.

Firefly has already generated over 9 billion images, demonstrating its extensive use and potential impact on creative workflows.

Adobe stock has lost more than 4% in the last 12 months. Investors can gain exposure to the stock via IShares Expanded Tech-Software Sector ETF (BATS:IGV) and Invesco AI And Next Gen Software ETF (NYSE:IGPT).

Price Action: At the last check on Friday, ADBE shares were trading higher by 15.01% at $527.15 in the premarket session.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Image via Shutterstock

“ACTIVE INVESTORS’ SECRET WEAPON” Supercharge Your Stock Market Game with the #1 “news & everything else” trading tool: Benzinga Pro – Click here to start Your 14-Day Trial Now!

Get the latest stock analysis from Benzinga?

This article Adobe’s Optimistic Forecast For New AI Tech Infused Products Attract Investor Cheer, Stock Soars originally appeared on Benzinga.com

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.