10:42 AM EDT, 09/08/2025 (MT Newswires) -- Adobe (ADBE) is likely to deliver "solid" fiscal third-quarter results, but competitive pressures around generative artificial intelligence monetization remain key concerns for investors, RBC Capital Markets said in a note e-mailed Monday.

The software maker is scheduled to release its quarterly results on Thursday.

RBC expects Adobe to report per-share earnings of $5.17 on revenue of $5.9 billion. Analysts polled by FactSet are looking for non-GAAP EPS of $5.18 on revenue of $5.92 billion. The company reported non-GAAP EPS of $4.65 and sales of $5.41 billion for the prior-year quarter.

Investor sentiment has failed to sustain the momentum that had started to build into second-quarter earning as investors continue to focus on long-term trends and competitive dynamics for genAI, RBC analysts, including Matthew Swanson, said.

"We would expect solid headline numbers in (the third quarter) and would look for signs of momentum and improved messaging," Swanson wrote. "Based on our conversations with investors, sentiment feels thematically focused with most conversations into the print not focused on headline numbers."

Adobe's appointment of a new vice president of investor relations, Doug Clark, could help improve management's narrative, according to Swanson.

Swanson said investors will be interested in the impact of a new tiered pricing and signs of consumption revenue coming from more compute intensive models like video, 3D and vector.

"Tiered pricing is the primary catalyst giving the company the ability to both better quantify the benefit of genAI functionality as well as provide a solution for potential seat count pressure," he said.

RBC reiterated its outperform rating on the stock, while lowering the price target to $430 from $480.

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