Adobe Inc.

Revenue and free cash flow at Adobe are highly predictable and subscription-driven. The majority of revenue comes from annual or multi-year contracts across Creative Cloud and Document Cloud. For example, in Q2 FY2024 Adobe added $487 million of net new annualized recurring revenue, bringing total Digital Media ARR to $16.25 billion.

This subscription base yields reliable cash flow. Adobe’s top-line growth has consistently been around 10% annually (2022–2024 CAGR 11%)), and it has performed well even in uneven economic periods by providing essential tools to businesses and consumers.

Adobe is aligned with the long-term secular trends of digital content creation and AI-powered design. While some forecasts were conservative (FY2025 guide was below expectations), management quickly raised guidance as demand held up.

The business is not prone to wide cyclicality or one-off swings; it is effectively a “tollbooth” on enterprise and creative activity. Geographic diversification (global customers, no reliance on any risky region) and a subscription model make future revenue and cash flows relatively secure.