Adobe Revenue for Q3 2023 Again Sets a Record at $4.89 Billion

Adobe Revenue for Q3 2023 Again Sets a Record at $4.89 Billion

The News: Adobe revenue for the third quarter (Q3) of fiscal year (FY) 2023 rose to $4.89 billion, up 10% from $4.4 billion one year ago. The digital creativity and experience software maker set a ninth straight quarterly revenue record. Adobe also beat analyst estimates on revenue and earnings per share (EPS) for the quarter as it announced its Q3 earnings on September 14 for the quarter ending September 1, 2023. Read the full press release on Adobe’s Q3 earnings on the company’s investor web page.

Adobe Revenue for Q3 2023 Again Sets Record at $4.89 Billion

Analyst Take: Adobe achieved excellent results as its $4.89 billion in revenue for FY 2023 Q3 continues the company’s impressive sequential streak of nine quarterly earnings records, dating back to Q3 FY2021 when the company brought in $3.8 billion.

As we have said previously, Adobe’s latest revenue figures provide clear evidence that the company’s products and business strategy are meeting the needs of its growing customer base and the overall marketplace.

Here are the Adobe Q3 FY 2023 earnings results by the numbers:

  • Q3 FY 2023 revenue was $4.89 billion, up 10% from $4.4 billion for the same quarter year over year (YoY). The $4.89 billion in revenue beat analyst consensus estimates of $4.87 billion for the quarter, according to
  • Q3 FY 2023 non-GAAP net income was $1.88 billion, up 18% from $1.60 billion YoY.
  • Q3 FY 2023 diluted non-GAAP earnings per share (EPS) were $4.09, up 20% from $3.40 EPS YoY. The EPS results beat analyst consensus estimates of $3.97 per share, according to
  • Q3 FY 2023 non-GAAP operating income was $2.26 billion, up 16% from $1.96 billion YoY.
  • Remaining performance obligation (RPO) totaled $15.72 billion at the end of the quarter.

Adobe’s Q3 numbers are positive, but we know there is more to come for the company. Adobe has a strong future in delivering generative AI and fresh AI-enhanced features within its products for its customers, and we continue to expect that these innovations will incrementally drive revenue growth in the future, adding to Adobe’s best-in-class gross margins.

We see strength in these numbers and a lot of runway for growth across the company’s three core business units as Adobe continues to drive sales and market excitement with its broad offerings.

Meanwhile, Adobe’s plan to acquire Figma is still undergoing a regulatory review from the European Commission and in the US and UK, which is putting pressure on the deal. The planned $20 billion acquisition of collaborative design platform vendor Figma was announced in late 2022 as a bold move and a big bet on collaborative design.

We see the potential deal as one that would further boost Adobe’s revenue and standing in the lucrative and demanding creative market, but now it is up to the regulators. We continue to like this proposed acquisition because it shows that Adobe is not standing still in the marketplace and is instead boldly trying to broaden its base and capture new revenue and segments.

Adobe Revenue by Business Segment Performance

By business segment, Adobe’s subscription revenue grew by 12% to $4.6 billion in Q3, up from $4.13 billion YoY. Product revenue for the quarter was $96 million, down 24% from $126 million YoY as customers moved to subscription-based products. Services and other revenue totaled $163 million, down 9% from $179 million YoY.

Adobe Revenue by Product Segment

Adobe revenue in Q3 by product segment also showed good performance.

Digital Media Q3 revenue totaled $3.59 billion, which was up 11% from $3.23 billion YoY. Creative revenue rose 11% to $2.91 billion from $2.63 billion YoY, while Document Cloud revenue hit $685 million, a 13% rise from $607 million YoY. Digital Experience Q3 segment revenue came in at $1.23 billion, a 10% increase from $1.12 billion YoY.

Adobe also reported net new Digital Media annual recurring revenue (ARR) of $464 million; its Creative ARR hit $11.97 billion; and its Document Cloud ARR rose to $2.63 billion.

Adobe’s Digital Experience subscription revenue reached $1.10 billion, a 12% increase from $981 million YoY.

Adobe Provides Guidance for Q4 FY2023

As part of its Q3 earnings report, Adobe also provided revenue guidance for the fourth quarter (Q4) of FY 2023.

For Q4 FY 2023, Adobe expects total revenue of $4.975 billion to $5.025 billion and non-GAAP EPS of $4.10 to $4.15 per share. The company said it expects Digital Media segment revenue in Q4 to reach between $3.67 billion to $3.7 billion, and Digital Experience segment revenue of $1.25 billion to $1.27 billion. The company also expects Digital Experience subscription revenue of between $1.11 billion to $1.13 billion.

What It Means: Adobe Revenue Q3 Overview

For Adobe, Q3 was another well-executed quarter as the company produced record revenue for the ninth consecutive quarter, showing its strength and positive market position. Despite challenging macroeconomic conditions around the globe, Adobe is performing well and shining amid the market’s adversity.

Adobe’s success comes from its broad and successful line of professional creativity products, including Adobe Photoshop, Acrobat Pro, Illustrator, Adobe Express, Lightroom, Dreamweaver, and Substance 3D Pro as well as its Document Cloud and Experience Cloud offerings. Adobe products are used daily by huge numbers of business professionals and consumers directly and indirectly for years, giving the company its longstanding model for success. We expect this healthy business relationship with its customers to continue and flourish.

Specifically, Adobe pointed to significant growth in monthly active users across the web, mobile, and embedded third-party ecosystems, demonstrating the effectiveness of the company’s product-led growth strategy. Adobe also noted key customer wins, including Citibank, GlaxoSmithKline, Emerson Electric, Morgan Stanley, and Volkswagen.

The rollout of generative AI also helped to drive revenue; single application subscriptions to Photoshop rose, due to increased interest in Firefly, Generative Fill, and Generative Expand, according to comments from Dan Durn, EVP and CFO of Adobe on the earnings call with analysts.

We continue to cheer Adobe’s successes in moving its customers to subscription models, which offer healthy recurring revenue. This approach is good for both the company and enterprise customers so that they can maintain access to the latest versions and features of their favorite creative applications.

Guided by Chairman and CEO Shantanu Narayen and his executive team, Adobe remains a strong leader in the creative software marketplace and in the overall tech economy. We remain bullish about Adobe and look forward to the company’s continued progress.

Adobe also announced Adobe also announced price increases that will go into effect after November 1, which will impact Creative Cloud users in North America, Central America, South America and Europe, which include those on Individual, Teams, and Enterprise and Reseller plans. These will have a moderate impact on Q4 2023 results, according to Adobe, but could provide a significant engine for growth in FY 2024 and beyond.

Daniel Newman and his co-host of The Six Five Webcast, Patrick Moorhead of Moor Insights and Strategy discussed Adobe’s latest earnings release in their latest episode. Check it out here and be sure to subscribe to The Six Five Webcast so you never miss an episode.

Disclosure: The Futurum Group is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.

Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of The Futurum Group as a whole.

Other insights from The Futurum Group:

Adobe Revenue for Q2 2023 Rises 10% YoY to Record $4.82 Billion

The EU Investigates Adobe-Figma Deal

The Marriage of Figma and Adobe: A Compelling Collaboration In Due Time

Author Information

Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.

From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.

A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.

An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.


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