From Photoshop to AI Agent: Adobe (ADBE.US) Rushes into the AI Gold Track to build a "AI + Creative Software" moat.

Wall Street financial giant Bank of America Corp recently released a research report stating that Adobe (ADBE.US), a leader in the AI application software field, has launched a powerful AI intelligent agent application called Agentic AI, which is still in the earliest stages of this cutting-edge technology. However, it is expected to become a key differentiating factor compared to other competitors in the same category of AI application software among Adobe's "AI + Creative Software" cloud software products. The performance report announced by the company in mid-June showed that Adobe, a software giant that provides popular creative software products such as Photoshop and Illustrator, finally saw a strong growth in data and performance prospects for its "AI + Creative Software" series of cloud software products after experiencing several quarters of weak performance, under the substantial boost from AI large-scale models. Against the backdrop of the global explosion of generative AI, Adobe actively seeks to seize market share with its "copyright compliance + workflow integration" strategy, intending to compete head-on with AI newcomers such as Sora and Runway in the field of AI applications. In the past two years, Adobe has significantly expanded its investment in generative AI, such as launching the Firefly series multimodal models and quickly embedding them into core creative software products like Photoshop, Premiere Pro, and Illustrator. It has also released heavyweight generative AI applications such as Firefly Video Model and Generative Extend, directly competing with AI newcomers like OpenAI Sora and Runway Gen. Undoubtedly, the Adobe "AI toolbox" has become the core engine driving the growth of Adobe's creative software sales. Statistics show that the Adobe-created AI large model family, the Firefly AI series, has been used over 24 billion times to generate over 24 billion units of AI content output. In addition, Adobe leverages the Firefly series multimodal models to automate repetitive tasks, conduct large data analysis and summaries based on powerful AI large models, provide real-time monitoring and insights reports, and make appropriate decisions on extremely complex situations in a short period with the "AI intelligent agent application". With the help of cutting-edge AI-based creative software products, revenue related to AI is expected to soar, a core reason driving the bullish stock price trend favored by Wall Street institutions such as Bank of America Corp and Morgan Stanley. Adobe's AI moat is becoming wider and wider "The AI intelligent agent cycle based on digital creative software businesses is still in its infancy," wrote Bank of America Corp analyst Brad Sills in a report to clients. "However, we believe that Adobe's AI intelligent agent products have the potential to expand Adobe's competitive moat in the core creative professional market through stronger workflow automation to support its exclusive creative content supply chain." Sills maintains a "buy" rating on Adobe with a target price of $475. As of Thursday, Adobe's stock price closed at $384. Adobe is accelerating the deployment of AI intelligent agents on the application side (some of which were announced at the Adobe 2025 summit), including Audience Agent, Content Production Agent, Data Insights Agent, and Product Advisor Agent. However, analyst Sills added that the new Adobe Brand Concierge may drive adoption scale and penetration rates among B2B and B2C users. Sills explained, "With the new Adobe Brand Concierge, companies can further configure these AI intelligent agents and provide a high-efficiency AI conversational experience for end customers from product exploration to purchase decision-making." "In addition, Adobe is also pushing for closer integration with various enterprise application partners. For example, integrating the 'AI + Creative Software' series with strategic partners such as Amazon.com, Inc.AWS, Microsoft Corporation Azure, SAP, Workday, and ServiceNow should be able to penetrate AI application software and AI intelligent agents in customer service, ERP/HR, and data management areas." Bank of America Corp stated that key differentiating factors include Adobe's extensive enterprise user base, a large stack of legitimate copyright data, its application-level orchestration and multimodal model layers, and its exclusive creative application layer ecosystem, etc. The company currently collaborates deeply with approximately 22,000 enterprise clients to build different illustrative processes for various metadata purposes. Analyst Sills added that although early feedback from customers indicates they are in a "wait and see" mode with a focus on facts, many AI application software products in the "AI + Creative Software" series, as well as some newly launched AI intelligent agent use cases, can integrate agents into daily workflows. "AI + Creative Software" leverages new growth engines In the view of another Wall Street financial giant, Morgan Stanley, the "AI + Creative Software" based on the Firefly series multimodal models has leveraged a new growth engine for Adobe. After the performance report was released, Morgan Stanley quickly issued a bullish research report to Adobe, reiterating its "hold" rating on the stock and a benchmark target price of up to $510; moreover, Morgan Stanley's analyst team's bullish target price is as high as $780, almost doubling. In the research report, Morgan Stanley emphasized that Adobe's current valuation is attractive at around 17 times future earnings and AI is expected to become a new growth driver for Adobe. Morgan Stanley stated that although Adobe's short-term performance growth is stable, with the accelerated penetration of AI intelligent agents in the second half of the year, and the positive catalysts brought by price adjustments, the monetization scale of the "AI + Creative Software" series products will continue to expand, driving revenue growth to significantly improve in the second half of this year and the 2026 fiscal year, thereby promoting fundamental expansion and stock performance.