Adobe Inc reported record revenue of $6.618 billion for the second quarter of FY2026 ended May 29, 2026, reflecting a 13% year-over-year increase. The performance was driven by strong AI-driven demand across customer groups, prompting the company to raise its full-year fiscal 2026 revenue and non-GAAP EPS targets. Shantanu Narayen, chair and CEO of Adobe, attributed the results to the momentum in new AI products and noted that AI-first annualized recurring revenue (ARR) tripled year-over-year, exceeding $500 million.
Diluted earnings per share was $4.25 on a GAAP basis and $5.96 on a non-GAAP basis, beating the analyst consensus estimate of $5.82. GAAP results included a $0.17 per share non-cash goodwill impairment charge related to the Publishing & Advertising reporting unit. Total Adobe Annualized Recurring Revenue (ARR) exiting the quarter was $27.10 billion. Remaining performance obligations stood at $22.27 billion, and the company exited the period with $4.92 billion in cash and cash equivalents. GAAP operating income was $2.24 billion and non-GAAP operating income was $2.95 billion, while cash flows from operations were $2.17 billion. The company repurchased approximately 8.5 million shares during the quarter.
Financial Targets
The updated targets factor in the acquisition of Semrush Holdings, Inc. and assume current macroeconomic conditions. For the third quarter of FY2026, Adobe targets total revenue between $6.67 billion and $6.72 billion. The company projects GAAP diluted EPS between $4.40 and $4.45. Non-GAAP diluted EPS is projected between $6.05 and $6.10.
For the full year FY2026, Adobe targets total revenue between $26.50 billion and $26.60 billion, compared to the previous outlook of $25.90 billion-$26.10 billion. The company narrowed its GAAP diluted EPS projection to between $17.90 and $18.00. Non-GAAP diluted EPS is projected between $24.35 and $24.45, an increase from the prior guidance of $23.30-$23.50. Total Adobe ending ARR growth is projected at 10.2% year over year.
Management Changes
Dan Durn, executive vice president and CFO, is departing the company on June 15, 2026, to pursue a new professional opportunity. Steve Day, SVP of Corporate Finance and CFO of Adobe's Customer Experience Orchestration Business Unit, will serve as interim Chief Financial Officer effective June 15, 2026. Mr. Day brings 20 years of financial leadership experience at Adobe to the role and will report directly to CEO and Chair Shantanu Narayen.
Q2 FY2026 Financial Highlights
| Metric |
Amount |
| Record Revenue |
$6.618 billion |
| GAAP Operating Income |
$2.24 billion |
| Non-GAAP Operating Income |
$2.95 billion |
| GAAP Net Income |
$1.71 billion |
| Non-GAAP Net Income |
$2.40 billion |
| Cash Flows from Operations |
$2.17 billion |
| Total ARR |
$27.10 billion |
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