Adobe Inc.

Welcome to the QNFY2026 Adobe Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Doug Clark, Vice President of Investor Relations. Please go ahead.

Good afternoon and thank you for joining us. With me on the call today are Shantanu Narayan, Adobe's Chair and CEO, David Wadwani, President of Creativity and Productivity, Anil Chakravarty, President of Customer Experience Orchestration, and Dan Dern, Executive Vice President and CFO. On this call, which is being recorded, we will discuss Adobe's first quarter fiscal year 2026 financial results. You can find our press release as well as PDFs of our prepared remarks and financial results on Adobe's Investor Relations website. The information discussed on this call, including our financial targets and product plans, is as of today, March 12, and contains forward-looking statements that involve risk, uncertainty, and assumptions. Actual results may differ materially from those set forth in these statements. For more information on those risks, please review today's earnings release and Adobe's SEC filings. On this call, we will discuss GAAP and non-GAAP financial measures. Our reported results include GAAP growth rates and non-GAAP growth rates, including constant currency rates. During this presentation, Adobe's executives will refer to revenue growth in constant currency rates unless otherwise stated. Non-GAAP reconciliations are available in our earnings release and on Adobe's investor relations website. I will now turn the call over to Shantanu.

Thanks, Doug. Good afternoon, everyone, and thank you for joining us. Earlier today, we announced that I will be transitioning from my role as CEO after over 18 years and 100 earnings calls. Over the coming months, I will be working with Frank Calderoni, Adobe's lead director, and the board of directors to identify my successor and to ensure a smooth transition. Until then, I will continue to lead Adobe as CEO and will stay on as chair of the board to support my successor, just as John and Chuck did when I took on this role. What attracted me to Adobe 28 years ago remains unchanged. Our leadership in creating new market categories, world-class products, a relentless drive to innovate in every functional area of the company and our employees who continue to invent the future. The privilege of leading this company has been the greatest honor of my career, and I'm committed to setting it up for its next decade of growth with the right leader and executive team in partnership with the board while driving our fiscal 26 strategic priorities. A mission to empower everyone to create represents an even larger opportunity in the AI era. Let me outline what Adobe is doing to drive our top-line growth while maintaining a high level of profitability. As a company that has prided itself on creating categories, our AI transformation begins with a focus on customer-centric product strategy to anticipate and fulfill the diverse needs of a large and growing customer base. At Adobe, we're targeting business professionals and consumers and creative and marketing professionals through differentiated AI-infused and AI-first product offerings across various routes to market and different monetization models. With creativity at the core, we're expanding innovation in all our flagship applications, as well as investing in new offerings. These new products include Adobe Acrobat Studio with Adobe Express, Adobe Firefly, and Adobe Gen Studio. Our new AI-first offerings ending ARR more than tripled year over year, reflecting progress against this opportunity with individuals and enterprises alike. Adobe's continued success in AI will be underpinned by our deep understanding of creativity domains the vast amount of data to which we have access, delivery of complex workflows driving business outcomes, and a great brand across individuals, small and medium businesses, and enterprises. Content is at the heart of all Adobe solutions, which powers educational, social, marketing, brand, entertainment, and business content. Our growth has always been fueled by attracting new users, individual consumers, students, and business professionals into our products, delighting them and driving adoption. We're ruthlessly focused on monthly active users as an indicator of adoption and success for Acrobat and Express, Creative Cloud applications, and Adobe Firefly across different surfaces, including desktop, web, mobile, and LLM platforms. In Q1, we surpassed 850 million monthly active users of Acrobat, Creative Cloud, Express, and Firefly, achieving 17% year-over-year growth, a clear indication that we have both strong usage and a foundation for monetization. In addition to broad end-user adoption, Adobe has always been a trusted partner for enterprises and we're increasingly being asked to help them drive their AI strategy across customer experience orchestration globally. Enterprises are looking to the combination of employees and automation to deliver on the demands of content and marketing at scale. Agentic AI will further enable outcome-focused enterprise workflows as customers look beyond speed to elevate creative differentiation, brand governance, and personalized experiences across channels. Adobe's end-to-end solutions are uniquely designed to meet these needs at scale. Strong momentum across our enterprise offerings underscores our leadership and customer confidence in Adobe's ability to deliver AI-driven value. In Q1, globally, we achieved over 30% year-over-year growth in AP and apps as well as Adobe Gen Studio ending ARR. Our goal has always been to meet customers wherever they work across the broad range of surfaces they use every day, and emerging new platforms have always been additive to our market opportunity. In addition to Windows, Mac, iOS, Android, Chrome, and Edge, we intend to integrate with leading AI platforms such as Anthropic, Google, Microsoft, NVIDIA, and OpenAI providing customers with access, choice, and flexibility. We're jointly driving enterprise transformation at scale in collaboration with global leaders such as Accenture, Cognizant, Deloitte, Dentsu, EY, IBM, Infosys, Omnicom, Publicis, PwC, Stagwell, TCS, and WPP. Given the strategy, I'm pleased with how Adobe is transitioning to an AI-driven business. We had a strong start to the year, achieving $6.4 billion in revenue in Q1, representing 11% year-over-year growth. Gap earnings per share for the quarter was $4.60, and non-gap earnings per share was $6.06, representing 11% and 19% year-over-year growth, respectively. Driving this momentum were Acrobat and Express, Creative Cloud Pro, overall strength in the CXO enterprise solutions, as well as in our AI-first applications. Importantly, we saw tremendous Mao growth in our new initiatives that dampens ARR in the short term, but sets us up to deliver in the quarters ahead. As we continue to transform the business to capitalize on the AI opportunity, our customer-focused strategy, rich product roadmap, innovation momentum, and early success across all routes to market Position us well to empower everyone to create. I'll now turn it over to David.