Adobe Inc. shares fell sharply after the software giant announced that Anil Chakravarthy will succeed longtime chief executive Shantanu Narayen as CEO, effective December 1, 2026. The announcement caught many investors and analysts off guard, sending ADBE stock down about 6.4% on Thursday and roughly 7% in Friday trading. The shares are now down roughly 20% year to date and trading at less than half their 2024 peak above $600.
Chakravarthy currently leads Adobe’s Customer Experience Orchestration business and worldwide field operations. He joined Adobe in 2020 after serving as CEO of cloud data management company Informatica. Narayen, who has led Adobe for 19 years, will move to the role of executive chair to help manage the transition. Narayen said he “could not be more confident” that Chakravarthy is the right person to lead Adobe in an AI-driven era, citing his work on AI-related products including Adobe CX Enterprise, GenStudio, and Brand Visibility.
The CEO selection was not the choice many expected. David Wadhwani, a 19-year Adobe veteran who led the company’s creative and productivity business, had been viewed as the logical frontrunner, especially because his segment represents roughly three-quarters of Adobe’s revenue. Wadhwani announced his departure shortly after the leadership decision, and Jefferies analysts said they expect additional executive departures as Chakravarthy reshapes the organization. Adobe’s chief financial officer, Dan Durn, had already left the company in June.
Wall Street reaction was mixed. Jefferies said Chakravarthy may be well suited to the needs of Adobe’s large enterprise clients, but the firm also noted the board could seek deeper AI expertise. Barclays raised its price target to $295 from $250 with an Equalweight rating, and RBC Capital lifted its target to $315 from $285 with an Outperform rating. Morgan Stanley took a more cautious view, downgrading Adobe to Underweight with a $240 target, citing concerns that AI competition could pressure recurring revenue from Creative Cloud.
The transition comes as Adobe faces increasing pressure from generative AI tools and competitors such as Canva and Figma. Investors will look for more clarity when Adobe reports its fiscal third-quarter earnings, scheduled around September 10–11.
