Wells Fargo downgraded Adobe (ADBE) to Underweight from Overweight. It cut its price target to $225 from $270. Adobe shares fell more than 2.6% in pre-market trading on October 12, 2026.
The firm cited disappointing third-quarter results and a challenging fourth-quarter forecast. A Wells Fargo survey of chief information officers found Adobe is losing budget share in the AI evaluation cycle. The bank also pointed to intensifying competition in Adobe’s core creative business.
Wells Fargo said Adobe’s preliminary fiscal 2027 guidance faces risks, including a lack of price increases. It also cited the ongoing transition in both the CEO and CFO roles. The bank now projects that Adobe’s new annual recurring revenue growth could turn negative in fiscal 2027.