Not only that, but Adobe reported $2.5 billion in positive free cash flow for the quarter, twice last year's $1.2 billion, and 36% more than reported net income. By these metrics, the quarter looked exceptionally strong, and earnings quality at Adobe was very good.

Adobe’s decline was mainly due to its disappointing forward guidance. Q2 revenue forecast came in at $5.77–$5.82 billion vs. the consensus of $5.8 billion. Investors were likely spooked as the lower end of the guidance still implies a chance of Adobe missing expectations.

Adobe is expected to report fiscal 2025 first-quarter results after the closing bell Wednesday, with analysts mostly bullish leading into the report and next week's Adobe Summit.

Creative software developer Adobe (ADBE)is set to release its first quarter Fiscal 2025 financials on March 12. ADBE stock has lost over 19% in