Conviction / Adjacent Beneficiaries
ADBE
Adobe Inc.
conviction
Adobe's newer artificial intelligence products tripled in size and passed 500 million dollars in annual revenue, but that is only about two percent of the company. The stock is down roughly 37 percent this year because investors think the same technology threatens the subscriptions that make up the other 98 percent.
What we judge
The view on expected return from here, 0 to 100.
Whether the thesis could succeed without this company at all. This moves slowly, and only when the company's position genuinely changes.
What we measure
Facts from market data, not judgments.
| Price | $256.58 |
| 30-day move | +15.8% |
| Position in 52-week range | 37 |
| From the 52-week high | -30.8% |
| Average daily volume | $1.5B |
Why it is in the fund
Thesis
Creative and marketing workflows increasingly automated by AI agents; pricing power eroding.
Standing judgment
Adobe is peripheral to an agent-backbone thesis and arguably sits on the wrong side of it: generative tools commoditize exactly the creative seat Adobe sells, so AI is a larger threat to this business than a benefit. Down about 37% year to date and 30% below its 52-week high at $259, trading near 13x earnings with a $25B buyback, so it is defensible as a value name. But the CEO announced his exit in March 2026, the CFO left abruptly on June 15 2026, and the ARR growth target was cut, which is a lot of instability to underwrite.
What changed, and why
Every move in this number carries the reason it moved. A score does not change without new evidence.
| Date | Conviction | Change | Cause | Evidence |
|---|---|---|---|---|
| 2026-08-05 | 50 | flat | first v3 judgment (v2 score was uninformative, see L-001): AI-first ARR of just over $500M against roughly $24B of revenue is about 2% of the business, which does not clear this bucket's bar of visible economic benefit, while the de-rating is being driven by a disruption fear the company has not yet disproved. | Q2 FY2026 revenue $6.62B, up 13% y/y, a record, with FY26 revenue and EPS targets raised. AI-first ARR tripled y/y and crossed $500M; Firefly ARR approaching $300M, up about 50% sequentially; Acrobat AI Assistant ARR nearly tripled. Against this: stock down 37% YTD and 43% from peak, ARR growth targ |
| 2026-08-05 | 50 | flat | first v3 judgment (v2 score was uninformative, see L-001): AI-first ARR of just over $500M against roughly $24B of revenue is about 2% of the business, which does not clear this bucket's bar of visible economic benefit, while the de-rating is being driven by a disruption fear the company has not yet disproved. | Q2 FY2026 revenue $6.62B, up 13% y/y, a record, with FY26 revenue and EPS targets raised. AI-first ARR tripled y/y and crossed $500M; Firefly ARR approaching $300M, up about 50% sequentially; Acrobat AI Assistant ARR nearly tripled. Against this: stock down 37% YTD and 43% from peak, ARR growth targ |
| 2026-07-31 | 50 | -6 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-30 | 56 | +10 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-29 | 46 | +3 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-28 | 43 | -9 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-27 | 52 | +20 | ⚠️ v2 rank-normalization artifact, unexplained move | v2 `scores` row |
| 2026-07-26 | 32 | -28 | ⚠️ v2 rank-normalization artifact, unexplained move | v2 `scores` row |
| 2026-07-25 | 60 | +8 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-24 | 52 | +17 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-23 | 35 | +11 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-22 | 24 | -42 | ⚠️ v2 rank-normalization artifact, unexplained move | v2 `scores` row |
| 2026-07-21 | 66 | +17 | migrated from v2 (cause not recorded) | v2 `scores` row |
| 2026-07-20 | 49 | +8 | migrated from v2 (cause not recorded) | v2 `scores` row |