Adobe Inc.

Adobe has a very strong financial position. The balance sheet shows low leverage and ample liquidity. As of late 2024, Adobe held roughly $6–8 billion in cash and short-term investments versus only about $3.6 billion of long-term debt. This means Adobe is net cash positive by several billion dollars.

The company generates substantial operating cash flow (about $5–$7 billion per year in recent years) and has maintained high free cash flow (FCF). MacroTrends data show Adobe’s annual FCF around $7.4B in 2022, $6.9B in 2023, and $7.9B in 2024 (the 2023 dip was due in part to investment timing).

Such healthy cash flow margins mean Adobe can weather downturns: it has historically continued to grow and invest even in tougher environments. The recent capital allocation (new $25B buyback) was only possible due to this financial strength. We see practically no bankruptcy risk even in severe recessions.