Citi downgrades Adobe to Sell and cuts price target amid leadership change and AI competition
Citi downgraded Adobe (ADBE) to Sell and lowered its price target to $207 from $250, citing the upcoming appointment of CEO Anil Chakravarthy in December and a strategic shift toward AI‑driven user growth. The bank expects fiscal 2027 annual recurring revenue (ARR) to grow about 5.3% and forecasts a 70‑basis‑point decline in non‑GAAP gross margin. It also projects ARR growth of roughly 5% year‑over‑year through fiscal 2028, below consensus estimates.
Why it matters
Citi’s downgrade and reduced price target suggest near‑term earnings pressure, which could weigh on Adobe’s share price. The lower ARR and margin forecasts signal slower growth and tighter profitability, affecting investors’ valuation models.
Key facts
- 1Citi downgraded Adobe to Sell from Neutral. finance.yahoo.com
- 2Citi cut its price target to $207 from $250. finance.yahoo.com
- 3Incoming CEO Anil Chakravarthy will assume the role on December 1. finance.yahoo.com
- 4Citi expects fiscal 2027 ARR growth of about 5.3%. finance.yahoo.com
- 5Citi lowered its fiscal 2027 non‑GAAP gross‑margin estimate by 70 basis points. finance.yahoo.com
- 6Citi projects ARR to grow at roughly 5% year over year through fiscal 2028, about 200‑300 basis points below consensus. cnbc.com
Summary written by AlphAI AI Desk from 3 of 3 sources. Not investment advice. Figures are as stated by the linked sources.