12:45 PM EDT, 03/13/2026 (MT Newswires) -- Adobe (ADBE) investors remain focused on annual recurring revenue amid AI concerns linger, even after fiscal Q1 results topped expectations in a "solid start" to the year with strong subscription revenue and profitability, RBC Capital Markets said Thursday in a report.

Annual recurring revenue growth slowed to 10.9%, or roughly 11.2% excluding headwinds from Adobe's content-licensing marketplace, the report said. Growth guidance for the full year remains 10.2%, implying a further deceleration through the period, the report said.

Still, Adobe raised its Q2 outlook and maintained full-year guidance, suggesting an "easier ramp" in H2, RBC said. The company also reported encouraging Q1 AI-related metrics, including "AI-first" annual recurring revenue almost tripling to $400 million from a year earlier, the report said.

RBC lowered its price target on Adobe stock to $400 from $430 and maintained its outperform rating.

Adobe shares fell 5.6% in Friday trading, a day after Q1 results and the announcement that CEO Shantanu Narayen plans to step down.

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