Adobe (ADBE) 10-K risk factor changes: FY2023 vs FY2022

[removed: These] [added: The occurrence of these] and many other factors described in this [removed: report] [added: report, and factors that we do not presently know or that we currently believe to be immaterial,] could [added: materially and] adversely affect our operations, performance and financial condition.

[removed: Any] [added: New industry standards, evolving distribution models, limited barriers to entry, short product life cycles, customer price sensitivity, global market conditions and the frequent entry] of [removed: these factors could] [added: new products or competitors may] create downward pressure on pricing and gross margins and [removed: could] adversely affect our [removed: renewal and] [added: renewal,] upsell and cross-sell [removed: rates,] [added: rates] as well as our ability to attract new customers.

As a [removed: result of these advantages, potential and] [added: result,] current [added: and potential] customers [removed: might] [added: may] select the [removed: products and] [added: products,] services [removed: of our competitors, causing a loss] [added: or solutions] of our [removed: market share.][added: competitors.]

Our [removed: competitors, including large enterprises,] [added: competitors] may develop products, [removed: features or] services [added: or solutions] that are similar to ours or that achieve greater acceptance, may undertake more far-reaching and successful product development efforts or marketing campaigns, or may adopt more aggressive pricing policies.

[removed: *[For] [added: *For] additional information regarding our competition and the risks arising out of the competitive environment in which we operate, see the section titled “Competition” contained in Part I, Item 1 of this [removed: report.](#iebcb91b2b75a4807a5a4d5cb7021397e_25)*][added: report.*]

We may not realize the anticipated benefits of [removed: past or future] investments or acquisitions, and [removed: integration of acquisitions] [added: they] may disrupt our business and [removed: management.][added: divert management’s attention.]

These risks [added: and uncertainties] include:

- inability to achieve the financial and strategic goals [removed: for] [added: of] the [removed: acquired and combined businesses;][added: investment or acquisition;]

- difficulty [removed: in, and the cost of,] [added: in] effectively integrating the operations, technologies, [removed: products or] [added: products,] services, [removed: and] [added: solutions, culture or] personnel of the acquired business;

- disruption of our ongoing business and distraction of our management and other [removed: employees from other opportunities and challenges;][added: personnel;]

- inability to retain [removed: personnel] [added: personnel, key customers, distributors, vendors and other business partners] of the acquired business;

- [added: increased collection times,] elevated delinquency or bad debt write-offs related to receivables of [removed: the] [added: an] acquired business we assume;

- difficulty in maintaining controls, procedures and policies during the transition and [removed: integration;][added: integration and inability to conclude that our internal controls over financial reporting are effective;]

- failure [removed: of our due diligence processes] to identify significant problems, liabilities or other challenges [removed: of an acquired company or technology;][added: during due diligence.]

- exposure to litigation or other claims in connection with, or inheritance of claims or litigation risk as a result of, an [removed: acquisition, such as claims from terminated employees, customers, former stockholders or other third parties;][added: acquisition;]

Our ability to acquire other businesses or technologies, make strategic investments or integrate acquired businesses effectively may also be impaired by [removed: the effects of the COVID-19 pandemic,] [added: adverse economic and political events,] including [removed: government actions in light of the pandemic,] trade tensions, [removed: restrictions] and increased global scrutiny of [removed: foreign] [added: acquisitions and strategic] investments.

[removed: For example, a] [added: A] number of countries, including the United States and countries in Europe and the Asia-Pacific region, are considering or have adopted [added: more stringent] restrictions [removed: on foreign investments.][added: or guidelines for such transactions.]

Governments may continue to adopt or tighten restrictions of this nature, and such restrictions [added: or government actions] could negatively impact our business and financial results.

[removed: Our] [added: Further, our] brands may be negatively affected by [removed: the use] [added: uses] of our [removed: products or] [added: products,] services [added: or solutions, particularly our AI offerings, in ways that are out of our control, such as] to create or disseminate [removed: newsworthy] content that is deemed to be misleading, deceptive or intended to manipulate public [removed: opinion (e.g., “DeepFakes”), by the use of our products] [added: opinion,] or [removed: services] for illicit, objectionable or illegal ends, or by our failure to respond appropriately and [removed: expeditiously] [added: in a timely manner] to such [removed: uses of our products and services.][added: uses.]

Such uses [removed: of our products and services] may [removed: also cause us to face] [added: result in controversy or] claims related to defamation, rights of [removed: publicity and privacy,] [added: publicity,] illegal content, [added: intellectual property infringement, harmful content,] misinformation and [added: disinformation, harmful bias, misappropriation, data privacy, derivative uses of third-party AI and] personal injury torts.

If we fail to appropriately respond to objectionable content created using our [removed: products or] [added: products,] services or [added: solutions or] shared on our platforms, our users may lose confidence in our [removed: brands and our business and financial results may be adversely affected.][added: brands.]

[removed: Social] [added: Social] and ethical issues relating to the use of [removed: new and evolving technologies, such as] AI, [added: including generative AI,] in our offerings may result in reputational [removed: harm] [added: harm, liability] and [removed: liability.][added: additional costs.]

We are increasingly [removed: building] [added: incorporating] AI [added: technologies] into many of our offerings.

Uncertainty around new and [removed: emerging] [added: evolving] AI [removed: applications such as] [added: use, including] generative [removed: AI content creation] [added: AI,] may require additional investment [removed: in the development of] [added: to develop responsible use frameworks, develop or license] proprietary datasets and machine learning [removed: models,][added: models and develop new approaches and processes to attribute or compensate content creators, which could be costly.]

Developing, [removed: testing,] [added: testing] and deploying AI systems may also increase the cost [removed: profile] of our [removed: offerings] [added: offerings, including] due to the nature of the computing costs involved in such systems.

Much of our [removed: business] [added: business, including our online store at adobe.com and our Creative Cloud, Document Cloud and Experience Cloud solutions,] relies on hardware and services that are hosted, managed and controlled directly by [removed: Adobe] [added: us] or third-party service [removed: providers, including our online store at adobe.com and our Creative Cloud, Document Cloud] [added: providers to be available to customers] and [removed: Experience Cloud solutions.][added: users without disruption.]

We do not have redundancy for all [removed: of] our systems, many of our critical applications [added: (“apps”)] reside in only one of our data centers, and our disaster recovery planning may not account for all eventualities.

If a transition among data centers or to third-party service providers encounters unexpected interruptions, unforeseen complexity or unplanned disruptions despite precautions undertaken during the process, this may impair our delivery of [removed: products and] [added: products,] services [added: and solutions] to customers and result in increased costs and liabilities, which may harm our operating results, reputation and our business.

It is also possible that hardware or software failures or errors in our systems (or those of our third-party service providers) could result in data loss or corruption, cause the information that we collect or maintain to be incomplete or contain inaccuracies that our customers regard as significant, or cause us to fail to meet committed service levels or comply with applicable notification [removed: requirements.][added: requirements or other relevant contractual obligations to our customers.]

[removed: In addition, the] [added: The] loss of [removed: data] [added: or unauthorized access to data, such as] resulting from computer viruses, worms, ransomware or other malware may harm our [removed: systems could] [added: systems,] expose us to litigation or regulatory [removed: investigation,] [added: investigation] and [added: subject us to] costly and time-intensive notification requirements.

We may also find, on occasion, that we cannot deliver data and reports to our customers in near [removed: real time] [added: real-time] due to factors such as significant spikes in customer activity on their websites or failures of our network or software (or that of a third-party service provider).

If we fail to plan infrastructure capacity appropriately and expand it proportionally with the needs of our customer [added: and user] base, and we experience a rapid and significant demand on the capacity of our data centers or those of third parties, service outages or performance issues could occur, which [removed: would] [added: may] impact our customers.

[added: Such a strain on our infrastructure] capacity [removed: could] [added: may] subject us to regulatory and customer notification requirements, violations of service level agreement commitments or financial liabilities and result in customer dissatisfaction or harm our business.

Maintaining the security of our [removed: products and] [added: products,] services [added: and solutions] is a critical issue for us and our customers.

Certain unauthorized parties have in the past managed, and may [removed: again] in the future manage, to [removed: gain access to and misuse some of] [added: overcome] our [removed: systems] [added: security measures] and [removed: software, or that] [added: those] of our third-party service [removed: providers, in order] [added: providers] to access [removed: the authentication, payment] and [removed: personal information of our end users] [added: misuse systems] and [removed: employees.][added: software by exploiting defects in design or manufacture, including bugs, vulnerabilities and other problems that unexpectedly compromise the security or operation of a product or system.]

[removed: Like other global companies, we] [added: We] face an increasingly difficult challenge to attract and retain highly qualified security personnel to assist us in combating [removed: these] security threats.

[removed: The costs to prevent, eliminate, mitigate or alleviate cyber or other security problems, bugs, viruses, worms, malicious software programs and security vulnerabilities are significant, and] [added: Further,] our efforts to address these problems, including notifying affected [removed: parties,] [added: third parties when appropriate, have in the past been, and] may [removed: not be successful] [added: in the future be, unsuccessful] or [removed: may be delayed and] [added: delayed, which] could result in [added: business] interruptions, [removed: delays,] cessation of service and loss of existing or potential customers.

It is impossible to predict the extent, frequency or impact [removed: these problems] [added: cybersecurity issues] may have on us.

[removed: Outside] [added: Further, malicious third] parties have in the past [added: attempted,] and may in the future [removed: attempt] [added: attempt,] to fraudulently induce our employees or users of our [removed: products or] [added: products,] services [added: or solutions] to disclose sensitive, personal or confidential information via illegal electronic spamming, phishing or other [removed: tactics.][added: tactics, and this risk is heightened in our current hybrid model working environment.]

[removed: Unauthorized] [added: Further, unauthorized] parties may also [removed: attempt to] gain physical access to our facilities [removed: in order to] [added: and] infiltrate our information systems or attempt to gain [removed: logical access to our products, services or information systems for the purpose of exfiltrating content and data.]

Many factors affect more than one category and the factors are not in order of significance or probability of occurrence because they have been grouped by categories.

We may be unsuccessful at innovating in response to rapid technological changes to meet customer needs, which could cause our operating results to suffer.

We operate in rapidly evolving markets and expect the pace of innovation to continue to accelerate.

We must continually introduce new, and enhance existing, products, services and solutions to retain customers and attract new customers.

Developing new products is complex and may not be profitable, and our investments in new technologies are speculative and may not yield the expected business or financial benefits.

The commercial success of new or enhanced products, services and solutions depends on a number of factors, including timely and successful development; effective distribution and marketing; market acceptance; compatibility with existing and emerging standards, platforms, software delivery methods and technologies; accurately predicting and anticipating customer needs and expectations and the direction of technological change; identifying and innovating in the right technologies; and differentiation from other products, services and solutions.

If we fail to anticipate or identify technological trends or fail to devote appropriate resources to adapt to such trends, our business could be harmed.

For example, generative artificial intelligence technologies provide new ways of marketing, creating content and interacting with documents that could disrupt industries in which we operate, and our business may be harmed if we fail to invest or adapt.

While we have released new generative artificial intelligence products, such as Adobe Firefly, and are focused on enhancing the artificial intelligence (“AI”) capabilities of such products and incorporating AI into existing products, services and solutions, there can be no assurance that our products will be successful or that we will innovate effectively to keep pace with the rapid evolution of AI across our Creative Cloud, Document Cloud and Experience Cloud.

If we do not successfully innovate, adapt to rapid technological changes and meet customer needs, our business and our financial results may be harmed.

Issues relating to the development and use of AI, including generative AI, in our offerings may result in reputational harm, liability and adverse financial results.

If our AI development, deployment, content labeling or governance is ineffective or inadequate, it may result in incidents that impair the public acceptance of AI solutions or cause harm to individuals, customers or society, or result in our offerings not working as intended or producing unexpected outcomes.

Around the world, AI regulation is in the nascent stages of development.

The evolving AI regulatory environment may increase our research and development costs, increase our liability related to the use of AI by our customers or users that are beyond our control and result in inconsistencies in evolving legal frameworks across jurisdictions.

While we have taken a responsible approach to the development and use of AI in our offerings, there can be no guarantee that future AI regulations will not adversely impact us or conflict with our approach to AI, including affecting our ability to make our AI offerings available without costly changes, requiring us to change our AI development practices, monetization strategies and/or indemnity protections and subjecting us to additional compliance requirements, regulatory action, competitive harm or legal

liability.

In addition, new competition regulation on AI development and deployment could impose new requirements on our markets that could impact our business and financial results.

These costs could adversely impact our margins as we continue to add AI capabilities to our offerings and scale our AI offerings without assurance that our customers and users will adopt them.

Further, as with any new offerings based on new technologies, consumer reception and monetization pathways are uncertain, our strategies may not be successful and our business and financial results could be adversely impacted.

New AI offerings and technologies could disrupt workforce needs, result in negative publicity about AI and have the potential to affect demand for our existing products, services and solutions, all of which could adversely impact our business.

Investments and acquisitions involve numerous risks and uncertainties, the occurrence of which may have an adverse effect on our business.

- challenges to completing or failure to complete an announced investment or acquisition related to the failure to obtain regulatory approval, or the need to satisfy certain conditions precedent to closing such transaction (such as divestitures, ownership or operational restrictions or other structural or behavioral remedies) that could limit the anticipated benefits of the transaction;

- incurring higher than anticipated costs to effectively integrate an acquired business, to bring an acquired company into compliance with applicable laws and regulations, additional compensation issued or assumed in connection with an acquisition, to divest products, services or solutions acquired in unsuccessful investments or acquisitions, to amortize costs for acquired intangible assets or because of our inability to take advantage of anticipated tax benefits;

- incurrence of additional debt to finance an acquisition, which will increase our interest expense and leverage, and/or issuance of equity securities to finance acquisitions, which will dilute current shareholders’ percentage ownership and earnings per share; and

Further, if we are not able to complete an announced acquisition or investment, or we do not achieve the financial and strategic goals of an acquisition or investment, we may not realize the anticipated benefits of such acquisition or investment or we may incur additional costs, which may negatively impact our business and financial results.

We participate in rapidly evolving and intensely competitive markets, and, if we do not compete effectively, our operating results could suffer.

The markets for our products, services and solutions are rapidly evolving and intensely competitive.

We expect competition to continue to intensify.

Our competitors range in size from diversified global companies with significant sales and research and development resources, broad brand awareness, long operating histories or access to large customer bases to small, specialized companies whose narrow focuses may allow them to be more effective in deploying technical, marketing and financial resources.

Further, our future success depends on our continued ability to effectively appeal to businesses and consumers.

In addition, we expect to face more competition as AI continues to be integrated into the markets in which we compete.

Our competitors or other third parties may incorporate AI into their offerings more successfully than we do and achieve greater and faster adoption, which could impair our ability to compete effectively and adversely affect our business and financial results.

Further, we expect the markets for standalone AI offerings to be highly competitive and rapidly evolving.

For example, we face increasing competition from companies offering text-to-image generative AI technology that may compete directly with our own creative offerings.

If we are not able to provide products, services and solutions that compete effectively, we could experience reduced sales and our business could be adversely affected.

If our reputation or our brands are damaged, our business and financial results may be adversely affected.

We believe our reputation and brands have been, and we expect them to continue to be, important to our business and financial results.

There are numerous ways that our reputation or brands could be damaged, including, among other things, introduction of new products, features or services that do not meet customer expectations, our position on or approach to new and evolving technologies, backlash from customers, government entities or other stakeholders that disagree with our product offering decisions or public policy positions, significant litigation or regulatory actions that negatively reflect on our business practices, our action or inaction or actual or perceived failure to meet our commitments on environmental, social and governance, ethical or political issues, public scrutiny regarding our handling of user privacy, data practices or content, data security breaches or compliance failures, or our approach to AI.

Entry into markets with weaker protection of brands or changes in the legal systems in countries in which we operate may also impact our ability to protect our brands.

If we fail to maintain, enhance or protect our brands, or if we incur excessive expenses in our efforts to do so, our business and financial results may be adversely affected.

The markets in which we participate are intensely competitive, and if we cannot continue to develop, acquire, market and offer new products and services or enhancements to existing products and services that meet customer requirements, our operating results could suffer.

The markets for our products and services are characterized by intense competition, new industry standards, evolving distribution models, limited barriers to entry, new technology developments, short product life cycles, customer price sensitivity, global market conditions and frequent product introductions (including alternatives with limited functionality available at lower costs or free of charge).

Our future success will depend on our continued ability to enhance and integrate our existing products and services, introduce new products and services in a timely and cost-effective manner, meet changing customer expectations and needs, extend our core technology into new applications, and anticipate emerging standards, business models, software delivery methods and other technological developments.

For example, consumers continue to migrate from personal computers to tablet and mobile devices and from desktop to the web.

While we offer our products on a variety of platforms, if we cannot continue adapting our products to tablet and mobile devices or the web, or if our competitors can adapt their products more quickly than us, our business could be harmed.

In addition, releases of new devices or operating systems may make it more difficult for our products to perform or may require significant cost to adapt our solutions.

The potential costs and delays incurred as a result could harm our business.

If we fail to anticipate or misjudge customers’ rapidly changing needs and expectations or adapt to emerging technological trends, our market share and results of operations could suffer.

Furthermore, some of our competitors and potential competitors enjoy competitive advantages, such as greater financial, technical, sales, marketing and other resources, broader brand awareness and access to larger customer bases.

Introduction of new technology could harm our business and results of operations.

The expectations and needs of technology consumers are constantly evolving.

As new technology is developed, integration of our products and services with one another and other companies’ offerings creates an increasingly complex ecosystem that is also partly reliant on third parties.

If any disruptive technology, or competing products, services or operating systems that are not compatible with our solutions, achieve widespread acceptance, our operating results could suffer and our business could be harmed.

The introduction of, or limitations on, certain technologies may reduce the effectiveness of our products and our business operations.

For example, some of our products and services, including those marketed or licensed through adobe.com, rely on tracking, third-party cookies or other identifiers to help our customers more effectively advertise and detect and prevent fraudulent activity.

However, consumers can, with increasing ease, implement technologies to limit the ability to collect and use data to deliver or advertise services.

Increased use of methods to control the use of these technologies through customers’ browsers, operating systems, device settings or “ad-blocking” software or applications may harm our business.

We may not realize the anticipated benefits of an investment or acquisition of a company, division, product or technology, each of which involves numerous risks.

- inability to retain key customers, distributors, vendors and other business partners of the acquired business;

- inability to take advantage of anticipated tax benefits;

- incurring acquisition-related costs or amortization costs for acquired intangible assets that could impact our operating results;

- additional costs of bringing acquired companies into compliance with laws and regulations applicable to a multinational corporation;

- impairment of our relationships with employees, customers, partners, distributors or third-party providers of our technologies, products or services;

- incurring significant exit charges if products or services acquired in business combinations are unsuccessful;

- inability to conclude that our internal controls over financial reporting are effective;

- inability to obtain, or obtain in a timely manner, approvals from governmental authorities, which could delay prevent or impose conditions on such acquisitions;

- the failure of strategic investments to perform as expected or to meet financial projections;

- additional stock-based compensation issued or assumed in connection with an acquisition, including the impact on stockholder dilution and our results of operations;

- increased accounts receivables collection times and working capital requirements associated with acquired business models; and

- incompatibility of business cultures.

Mergers and acquisitions of technology companies are inherently risky.

If we do not complete an announced acquisition transaction, including the pending acquisition of Figma, Inc., or integrate an acquired business successfully and in a timely manner, we may not realize the benefits of the acquisition to the extent anticipated, and in certain circumstances an acquisition could harm our financial position.

The success of some of our product and service offerings depends on our ability to continue to attract and retain customers of and contributors to our online marketplaces for creative content.

The success of some of our product and service offerings, such as Adobe Stock, depends on our ability to continue to retain existing and attract new customers and contributors to these online marketplaces for creative content.

An increase in paying customers has generally resulted in more content from contributors, which increases the size of our collection and in turn attracts new paying customers.

We rely on the functionality and features of our online marketplaces, the size and content of our collection and the effectiveness of our marketing efforts to attract new customers and contributors and retain existing ones.

New technologies may render the features of our online marketplaces obsolete, our collection may fail to grow as anticipated or our marketing efforts may be unsuccessful, any of which may adversely affect our results of operations.

If our products or platforms are used to create or disseminate objectionable content, particularly misleading content intended to manipulate public opinion, our brand reputation may be damaged, and our business and financial results may be harmed.

We believe that our brands have significantly contributed to the success of our business.

Maintaining and enhancing the brands within Adobe increases our ability to enter new categories, launch new and innovative products to better serve our customers and expand our customer base.

Discussion regarding our financial condition and results of operations for fiscal [removed: 2021] [added: 2022] as compared to fiscal [removed: 2020] [added: 2021] is included in Item 7 of our Annual Report on Form 10-K for the fiscal year ended December [removed: 3, 2021,] [added: 2, 2022,] filed with the SEC on January [removed: 21, 2022.*][added: 17, 2023.*]

We believe that the assumptions, judgments and estimates involved in the accounting for revenue [removed: recognition, business combinations] [added: recognition] and income taxes have the greatest potential impact on our Consolidated Financial Statements.

[removed: To the extent that the final] determination of any of these examinations is different from the amounts recorded, such differences will affect the provision for income taxes and the effective tax rate in the period in which such determination is made.

*[See Note 1 of our Notes to Consolidated Financial Statements for information regarding recent accounting pronouncements that are of [removed: significance, or] [added: significance](#id2fffb105edb44a29625d93e58bf85a1_136) [or] potential [removed: significance to us.](#iebcb91b2b75a4807a5a4d5cb7021397e_139)*][added: significance](#id2fffb105edb44a29625d93e58bf85a1_136) [to us.](#id2fffb105edb44a29625d93e58bf85a1_136)*]

*[See Note [removed: 3] [added: 10] of our Notes to Consolidated Financial Statements for further information regarding [removed: these acquisitions.](#iebcb91b2b75a4807a5a4d5cb7021397e_145)*][added: our provision for](#id2fffb105edb44a29625d93e58bf85a1_169) [income taxes.](#id2fffb105edb44a29625d93e58bf85a1_169)*]

For our fiscal [removed: 2022,] [added: 2023,] we experienced strong demand across our Digital Media and Digital Experience offerings, driven by [removed: the ongoing shift towards a digital-first world.][added: our innovative product roadmap.]

As we execute on our long-term growth [removed: initiatives,] [added: initiatives and deliver product innovation,] we have continued to experience growth in software-based subscription revenue across our portfolio of offerings.

[removed: Starting in December 2021,] Creative Cloud includes Adobe Express, a web and mobile [removed: application] [added: app] designed to enable a broad spectrum of users, including novice content creators, communicators and creative professionals, to create, edit and customize content quickly and easily with content-first, task-based solutions.

[added: Creative Cloud delivers value with deep, cross-product integration, frequent product updates and feature enhancements, cloud-enabled services including storage and] syncing of files across users’ devices, machine learning and artificial intelligence, access to marketplace, social and community-based features with our Adobe Stock and Behance services, app creation capabilities, tools which assist with enterprise deployments and team collaboration, and affordable pricing for cost-sensitive customers.

We expect Creative Cloud will drive sustained long-term revenue growth through a continued expansion of our customer base by attracting new users with new features and products like Adobe Express [added: and Adobe Firefly] that make creative tools accessible to first-time creators and communicators, and delivering new features and technologies to existing customers with our latest releases such as share for [removed: review.][added: review and generative AI capabilities.]

Overall, our strategy with Creative Cloud is designed to enable us to increase our revenue with [added: existing] users, [added: continue to] attract [removed: more] new customers, and grow our recurring and predictable revenue stream that is recognized ratably.

These strategies include increasing the value Creative Cloud users receive, such as offering new [added: and enhanced] desktop, web and mobile [removed: applications,] [added: apps,] as well as targeted promotions and offers that attract past customers and potential users to experience and ultimately subscribe to Creative Cloud.

We are also a market leader with our Document Cloud offerings built around our Adobe Acrobat family of products, with a set of integrated mobile apps and cloud-based document services which enable users to create, [added: collaborate,] review, approve, sign and track documents regardless of platform or application source type.

Adobe Acrobat is offered both through subscription and perpetual [removed: licenses.][added: licenses, and is also included in our Creative Cloud All Apps subscription offering.]

As part of our Creative Cloud and Document Cloud strategies, we utilize a data-driven operating model (“DDOM”) and our Adobe Experience Cloud solutions to raise awareness of our products, drive new customer acquisition, engagement and retention, and optimize customer journeys, [removed: and it continues] [added: which continue] to contribute strong [added: product-led] growth in the business.

[removed: Our reported ARR results in the] current fiscal year are based on currency rates set at the beginning of the year and held constant throughout the year for measurement purposes.

Creative ARR exiting fiscal [removed: 2022] [added: 2023] was [removed: $11.60] [added: $12.37] billion, up from [removed: $10.22] [added: $10.98] billion at the end of fiscal [removed: 2021.][added: 2022.]

Document Cloud ARR exiting fiscal [removed: 2022] [added: 2023] was [removed: $2.37] [added: $2.81] billion, up from [removed: $1.93] [added: $2.28] billion at the end of fiscal [removed: 2021.][added: 2022.]

Total Digital Media ARR grew to [removed: $13.97] [added: $15.17] billion at the end of fiscal [removed: 2022,] [added: 2023,] up from [removed: $12.15] [added: $13.26] billion at the end of fiscal [removed: 2021.][added: 2022.]

Revaluing our ending ARR for fiscal [removed: 2022] [added: 2023] using currency rates [added: determined] at the beginning of fiscal [removed: 2023,] [added: 2024,] our Digital Media ARR at the end of fiscal [removed: 2022] [added: 2023] would be [removed: $13.26] [added: $15.33] billion or approximately [removed: $712] [added: $160] million [removed: lower] [added: higher] than the ARR reported above.

Creative revenue in fiscal [removed: 2022] [added: 2023] was [removed: $10.46] [added: $11.52] billion, up from [removed: $9.55] [added: $10.46] billion in fiscal [removed: 2021] [added: 2022] and representing 10% year-over-year growth.

Document Cloud revenue in fiscal [removed: 2022] [added: 2023] was [removed: $2.38] [added: $2.70] billion, up from [removed: $1.97] [added: $2.38] billion in fiscal [removed: 2021] [added: 2022] and representing [removed: 21%] [added: 13%] year-over-year growth.

Total Digital Media segment revenue grew to [removed: $12.84] [added: $14.22] billion in fiscal [removed: 2022,] [added: 2023,] up from [removed: $11.52] [added: $12.84] billion in fiscal [removed: 2021] [added: 2022] and representing 11% year-over-year growth driven by strong net new user growth.

The Adobe Experience Cloud [removed: applications, services] [added: apps] and [removed: platform] [added: services] are designed to manage customer journeys, enable personalized experiences at scale and deliver intelligence for businesses of any size in any industry.

[removed: - *Data insights and audiences.*] Our [removed: solutions,] [added: products,] including Adobe Analytics, [removed: Adobe Experience Platform,] Customer Journey Analytics, Adobe [removed: Audience Manager] [added: Product Analytics,] and our Real-time Customer Data Platform, deliver [removed: robust customer profiles and AI-powered analytics across the customer journey] [added: actionable data in real time] to provide [removed: timely, relevant] [added: highly tailored and adaptive] experiences across platforms.

[removed: - *Content and commerce.*] Our [removed: solutions] [added: products] help customers manage, [removed: deliver] [added: deliver, monetize,] and optimize content delivery through Adobe Experience [removed: Manager,] [added: Manager] and [removed: enable shopping] [added: build multi-channel commerce] experiences [removed: that scale from mid-market to enterprise businesses] [added: for B2B and B2C customers on a single platform] with Adobe Commerce.

[removed: - *Customer journeys.*] Our [removed: solutions] [added: products] help businesses manage, test, [removed: target, personalize and orchestrate campaigns] [added: target] and [added: personalize] customer journeys [added: delivered as campaigns] across [removed: B2E] [added: B2B and B2C] use cases, including through [added: Adobe] Marketo Engage, Adobe Campaign, Adobe Target and [added: Adobe] Journey Optimizer.

These customers often are involved in workflows that [removed: utilize] [added: integrate] other Adobe products, such as our Digital Media offerings.

By combining the creativity of our Digital Media business with the science of our Digital Experience business, [added: such as with our new Adobe GenStudio solution,] we help our customers to more efficiently and effectively make, manage, measure and monetize their content across every channel with an end-to-end workflow and feedback loop.

We have made significant investments to broaden the scale and size of all of these routes to market, and our recent financial results reflect the success of these [removed: investments.][added: investments and our experience-led growth strategy.]

Digital Experience revenue was [removed: $4.42] [added: $4.89] billion in fiscal [removed: 2022,] [added: 2023,] up from [removed: $3.87] [added: $4.42] billion in fiscal [removed: 2021] [added: 2022] which represents [removed: 14%] [added: 11%] year-over-year growth.

Driving this [removed: increase] [added: growth] was the increase in subscription [removed: revenue across our offerings] [added: revenue,] which grew to [removed: $3.88] [added: $4.33] billion in fiscal [removed: 2022] [added: 2023] from [removed: $3.38] [added: $3.88] billion in fiscal [removed: 2021,] [added: 2022,] representing [removed: 15%] [added: 12%] year-over-year growth.

We continuously monitor the direct and indirect impacts of these circumstances on our business and financial [removed: results, as well as the overall global economy and geopolitical landscape.][added: results.]

[removed: Foreign] [added: For example, foreign] currency exchange rate fluctuations have negatively impacted our revenue and earnings during fiscal [removed: 2022,] [added: 2023,] and [removed: are expected to] [added: may] continue to negatively impact our financial results in fiscal [removed: 2023.][added: 2024.]

*[See the section titled “Risk Factors” in Part I, Item 1A of this report for further discussion of the possible impact of these macroeconomic issues on our [removed: business.](#iebcb91b2b75a4807a5a4d5cb7021397e_49)*][added: business.](#id2fffb105edb44a29625d93e58bf85a1_49)*]

*Financial Performance Summary for Fiscal [removed: 2022*][added: 2023*]

- Total Digital Media ARR of approximately [removed: $13.97] [added: $15.17] billion as of December [removed: 2, 2022] [added: 1, 2023] increased by [removed: $1.82] [added: $1.91] billion, or [removed: 15%,] [added: 14%,] from [removed: $12.15] [added: $13.26] billion as of December [removed: 3, 2021.][added: 2, 2022.]

- Creative revenue of [removed: $10.46] [added: $11.52] billion increased by [removed: $913 million,] [added: $1.06 billion,] or 10%, during fiscal [removed: 2022,] [added: 2023,] from [removed: $9.55] [added: $10.46] billion in fiscal [removed: 2021.][added: 2022.]

Document Cloud revenue of [removed: $2.38] [added: $2.70] billion increased by [removed: $409] [added: $316] million, or [removed: 21%,] [added: 13%,] during fiscal [removed: 2022,] [added: 2023,] from [removed: $1.97] [added: $2.38] billion in fiscal [removed: 2021.][added: 2022.]

- Digital Experience revenue of [removed: $4.42] [added: $4.89] billion increased by [removed: $555] [added: $471] million, or [removed: 14%,] [added: 11%,] during fiscal [removed: 2022,] [added: 2023,] from [removed: $3.87] [added: $4.42] billion in fiscal [removed: 2021.][added: 2022.]

To the extent that the final

Overview of 2023

In September 2023, we released Adobe Firefly, a group of creative generative AI models designed to generate high quality images and text effects.

Adobe Firefly-powered generative AI features are also available across Creative Cloud apps including Adobe Photoshop and Adobe Express.

Our reported ARR results in the

- *Data insights and audiences*.

- *Content and commerce*.

- *Customer journeys*.

- *Marketing planning and workflow*.

Our products help businesses intelligently measure, optimize, and plan marketing investments through the Adobe Mix Modeler, and allow businesses to strategically plan, manage, collaborate, and execute on workflows for marketing campaigns and other projects at speed and scale with our enterprise work management app, Adobe Workfront.

As a corporation with an extensive global footprint, we are subject to risks and exposures from the evolving macroeconomic environment, including the effects of increased global inflationary pressures and interest rates, fluctuations in foreign currency exchange rates, potential economic slowdowns or recessions and geopolitical pressures, including the unknown impacts of current and future trade regulations.

- Remaining performance obligations of $17.22 billion as of December 1, 2023 increased by $2.02 billion, or 13%, from $15.19 billion as of December 2, 2022.

- Cost of revenue of $2.35 billion increased by $189 million, or 9%, during fiscal 2023, from $2.17 billion in fiscal 2022.

- Operating expenses of $10.41 billion increased by $1.06 billion, or 11%, during fiscal 2023, from $9.34 billion in fiscal 2022.

- Net income of $5.43 billion increased by $672 million, or 14%, during fiscal 2023, from $4.76 billion in fiscal 2022.

- Cash flows from operations of $7.30 billion during fiscal 2023 decreased by $536 million, or 7%, from $7.84 billion in fiscal 2022.

and game developers; communicators, including content creators, students, marketers and knowledge workers; and consumers.

| *(dollars in millions)* | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | | | | | % Change 2023-2022 | | | | | | | | |

| Total revenue | | | | | | $ | 19,409 | | | | | $ | 17,606 | | | | | $ | 15,785 | | | | | 10 | | % | | | | | | |

| *(dollars in millions)* | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | | | | | % Change 2023-2022 | | |

| *(dollars in millions)* | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | | | | | % Change 2023-2022 | | | | | | | | |

| Total revenue | | | | | | $ | 19,409 | | | | | $ | 17,606 | | | | | $ | 15,785 | | | | | 10 | | % | | | | | | |

Overall revenue during fiscal 2023 increased in all geographic regions as compared to fiscal 2022.

| *(dollars in millions)* | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | | | | | % Change 2023-2022 | | | | | | | | |

| Loss contingency | | | 3 | | | | | | | | |

Cost of subscription revenue during fiscal 2023 included a loss contingency associated with an IP litigation matter.

| *(dollars in millions)* | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | | | | | % Change 2023-2022 | | | | | | | | |

| | | | Components of % Change 2023-2022 | | | | | | | | |

| Hosting services and data center costs | | | 2 | | | | | | | | |

| | | | Components of % Change 2023-2022 | | | | | | | | |

| | | | | | | | | | | | |

| | | | Components of % Change 2023-2022 | | | | | | | | |

| | | | | | | | | | | | |

| | | | | | | | | | | | |

| | | | | | | | | | | | |

| | | | | | | | | | | | |

| | | | | | | | | | | | |

| *(dollars in millions)* | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | | | | | % Change 2023-2022 | | | | | | | | |

| *(dollars in millions)* | | | | | | 2023 | | | | | | 2022 | | | | | | 2021 | | | | | | % Change 2023-2022 | | | | | | | | |

Our effective tax rate decreased by approximately one percentage point during fiscal 2023 as compared to fiscal 2022, primarily due to an increase in the net tax benefit from effects of non-U.S. operations in fiscal 2023.

Business Combinations

We allocate the purchase price of acquired companies to tangible and intangible assets acquired and liabilities assumed based upon their estimated fair values at the acquisition date.

The purchase price allocation process requires management to make significant estimates and assumptions with respect to intangible assets and deferred revenue obligations.

Although we believe the assumptions and estimates we have made are reasonable, they are based in part on historical experience, market conditions and information obtained from management of the acquired companies and are inherently uncertain.

Examples of critical estimates in valuing certain of the intangible assets we have acquired or may acquire in the future include but are not limited to:

- future expected cash flows from software license sales, subscriptions, support agreements, consulting contracts and acquired developed technologies and patents;

- expected costs to develop acquired technologies and patents internally into commercially viable products;

- historical and expected customer attrition rates and anticipated growth in revenue from acquired customers;

- the acquired company’s trade name and trademarks as well as assumptions about the period of time the acquired trade name and trademarks will continue to be used in the combined company’s product portfolio;

- the expected use of the acquired assets; and

- discount rates.

In connection with the purchase price allocations for our acquisitions, we estimate the fair value of the deferred revenue obligations assumed.

The estimated fair value of these obligations is determined utilizing a cost build-up approach.

The cost build-up approach determines fair value by estimating the costs related to fulfilling the obligations plus a normal profit margin.

Unanticipated events and circumstances may occur which may affect the accuracy or validity of such assumptions, estimates or actual results.

ACQUISITIONS

In the fourth quarter of fiscal 2021, we completed the acquisition of Frame.io, a privately held company that provides a cloud-based video collaboration platform, for approximately $1.24 billion and we began integrating Frame.io into our Digital Media reportable segment.

In the first quarter of fiscal 2021, we completed the acquisition of Workfront, a privately held company that provides a workflow platform, for approximately $1.52 billion in cash consideration and we began integrating Workfront into our Digital Experience reportable segment.

Overview of 2022

Creative Cloud delivers value with deep, cross-product integration, frequent product updates and feature enhancements, cloud-enabled services including storage and

In March 2022, in response to the Russia-Ukraine war, we announced a halt of all new sales of our products and services in Russia and Belarus.

As a result, we reduced our Digital Media ARR balance by $75 million, which represented our Digital Media ARR for existing business in Russia and Belarus.

While we continued to provide Digital Media services in Ukraine, we also reduced our Digital Media ARR balance by an additional $12 million, which represented our Digital Media business in Ukraine.

This resulted in a total ARR reduction of $87 million taken at the beginning of the second quarter of fiscal 2022.

- *Marketing workflow.* We offer Adobe Workfront, a work management platform directed toward marketers to orchestrate campaign workflows.

As a corporation with an extensive global footprint, we are subject to risks and exposures from foreign currency exchange rate fluctuations caused by significant events with macroeconomic impacts, including, but not limited to, the Russia-Ukraine war, COVID-19 pandemic and actions taken by central banks to counter inflation.

The change in our Digital Media ARR was primarily due to new user adoption of our Creative Cloud and Document Cloud offerings, partially offset by an $87 million ARR reduction taken in March 2022 in response to the Russia-Ukraine war.

The increases were primarily due to subscription revenue growth associated with our Creative Cloud and Document Cloud offerings.

The increase was primarily due to subscription revenue growth across our offerings.

- Cost of revenue of $2.17 billion increased by $300 million, or 16%, during fiscal 2022, from $1.87 billion in fiscal 2021 primarily due to increases in hosting services and data center costs, as well as increases in base and incentive compensation and related benefits costs.

- Operating expenses of $9.34 billion increased by $1.23 billion, or 15%, during fiscal 2022, from $8.12 billion in fiscal 2021 primarily due to increases in base and incentive compensation and related benefits costs, as well as increased marketing spend.

- Cash flows from operations of $7.84 billion during fiscal 2022 increased by $608 million, or 8%, from $7.23 billion in fiscal 2021 primarily due to higher net income after adjustment for non-cash items.

Revenue from Digital Experience increased $555 million during fiscal 2022 as compared to fiscal 2021 primarily due to net new additions across our subscription offerings, partially offset by the impact of foreign currency exchange rate fluctuations.

Overall revenue during fiscal 2022 increased in all geographic regions as compared to fiscal 2021 primarily due to increases in Digital Media revenue and, to a lesser extent, increases in Digital Experience revenue.

Cost of services and other also includes media costs related to impressions purchased from third-party ad inventory sources for our transaction-based Adobe Advertising Cloud offerings.

| Marketing spend related to campaigns, events and overall marketing efforts | | | 5 | | % | | | | | | |

| Professional and consulting fees | | | 4 | | % | | | | | | |

| Incentive compensation, cash and stock-based | | | 4 | | | | | | | | |

| Charitable contributions | | | 2 | | | | | | | | |

| Charges related to cancellation of corporate events, net of recoveries | | | (2) | | | | | | | | |

We may use foreign exchange option contracts [removed: or] [added: and] forward contracts to hedge a portion of our forecasted foreign currency denominated revenue and expenses.

Our significant foreign currency revenue exposures for fiscal [removed: 2022, 2021] [added: 2023, 2022] and [removed: 2020] [added: 2021] were as follows:

| *(in millions)* | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | |

| Euro | | | € | [removed: 2,487] [added: 2,842] | | | | | € | [removed: 2,209] [added: 2,487] | | | | | € | [removed: 1,887] [added: 2,209] | |

| Japanese Yen | | | ¥ | [removed: 118,456] [added: 129,127] | | | | | ¥ | [removed: 104,829] [added: 118,456] | | | | | ¥ | [removed: 88,640] [added: 104,829] | |

| British Pounds | | | £ | [removed: 737] [added: 818] | | | | | £ | [removed: 669] [added: 737] | | | | | £ | [removed: 562] [added: 669] | |

| Australian Dollars | | | $ | [removed: 876] [added: 973] | | | | | $ | [removed: 768] [added: 876] | | | | | $ | [removed: 645] [added: 768] | |

As of December [removed: 2, 2022,] [added: 1, 2023,] the total notional amounts of all outstanding foreign exchange contracts, including options and forwards, were [removed: $3.25] [added: $3.83] billion, which included the notional equivalent of [removed: $1.32] [added: $1.52] billion in Euros, [removed: $602] [added: $773] million in Indian Rupees, [removed: $480] [added: $634] million in British Pounds, [removed: $394] [added: $409] million in Japanese Yen, [removed: $338] [added: $350] million in Australian Dollars and [removed: $112] [added: $135] million in other foreign currencies.

As of December [removed: 2, 2022,] [added: 1, 2023,] all contracts were set to expire at various dates through November [removed: 2023.][added: 2024.]

A sensitivity analysis was performed on all of our foreign exchange derivatives as of December [removed: 2, 2022.][added: 1, 2023.]

A 10% increase in the value of the U.S. Dollar and a corresponding decrease in the value of the hedged foreign currency asset would lead to an increase in the fair value of our financial hedging instruments by [removed: $75] [added: $142] million.

A 10% decrease in the value of the U.S. Dollar would lead to [removed: an increase] [added: a decrease] in the fair value of these financial instruments by [removed: $17] [added: $1] million.

As of December [removed: 2, 2022] [added: 1, 2023] and December [removed: 3, 2021,] [added: 2, 2022,] this long-term investment exposure totaled an absolute notional equivalent of [removed: $770 million] [added: $1.03 billion] and [removed: $749] [added: $770] million, respectively.

For the fiscal year ended December [removed: 2, 2022,] [added: 1, 2023,] there were no net gains or losses recognized in revenue or operating expenses relating to hedges of forecasted transactions that did not occur.

At December [removed: 2, 2022,] [added: 1, 2023,] the outstanding balance sheet hedging derivatives had maturities of 180 days or less.

*[See Note 6 of our Notes to Consolidated Financial Statements for information regarding our derivative financial [removed: instruments.](#iebcb91b2b75a4807a5a4d5cb7021397e_157)*][added: instruments.](#id2fffb105edb44a29625d93e58bf85a1_154)*]

At December [removed: 2, 2022,] [added: 1, 2023,] we had debt securities classified as short-term investments of [removed: $1.86 billion.][added: $701 million.]

A sensitivity analysis was performed on our short-term investment portfolio as of December [removed: 2, 2022,] [added: 1, 2023,] based on an estimate of the hypothetical changes in market value of the portfolio that would result from an immediate parallel shift in the yield curve.

A 150 basis point increase in interest rates would lead to a [removed: $20] [added: $6] million decrease in the market value of our short-term investments.

Conversely, a 150 basis point decrease in interest rates would lead to a [removed: $20] [added: $6] million increase in the market value of our short-term investments.

As of December [removed: 2, 2022,] [added: 1, 2023,] we had [removed: $4.15] [added: $3.65] billion of senior notes outstanding which bear interest at fixed rates, and therefore do not subject us to financial statement risk associated with changes in interest rates.

As of December [removed: 2, 2022,] [added: 1, 2023,] the total carrying amount of our senior notes was [removed: $4.13] [added: $3.63] billion and the related fair value based on observable market prices in less active markets was [removed: $3.88] [added: $3.39] billion.

*[See Note 17 of our Notes to Consolidated Financial Statements for information regarding our senior [removed: notes.](#iebcb91b2b75a4807a5a4d5cb7021397e_196)*][added: notes.](#id2fffb105edb44a29625d93e58bf85a1_193)*]

We market our [removed: products and] [added: products,] services [added: and solutions] directly to enterprise customers through our sales force and local field [removed: offices.][added: offices and directly to consumers.]

We license our products to end users through app stores and our own website at [removed: www.adobe.com.][added: adobe.com.]

We offer many of our products via a [removed: Software-as-a-Service (“SaaS”)] [added: SaaS] model or a managed services model (both of which are referred to as hosted or cloud-based) as well as through term subscription and pay-per-use models.

We also [added: market and] distribute [removed: certain] [added: our] products [removed: and services] through [removed: a network of] [added: sales channels, which include] distributors, [removed: value-added resellers (“VARs”),] [added: retailers, software developers, mobile app stores,] systems [removed: integrators (“SIs”),] [added: integrators,] independent software vendors [removed: (“ISVs”), retailers, software developers] and [added: value-added resellers, as well as through] original equipment [removed: manufacturers (“OEMs”).][added: manufacturer and hardware manufacturer customers.]

The information posted to our website [removed: is] [added: and contents of the websites referred to above are] not incorporated into this Annual Report on Form 10-K.

For [added: over] four decades, Adobe’s innovations have transformed how individuals, teams, [removed: businesses] [added: businesses, enterprises, institutions,] and governments engage and interact across all types of media.

[removed: While we continue to offer a broad portfolio of products, services and solutions, we] [added: We] focus our [added: strategic] investments in two areas of [removed: strategic] growth:

Digital Media. We provide products, services and solutions that enable individuals, [removed: teams] [added: teams, businesses] and enterprises to create, publish and promote their content [removed: anywhere] [added: anywhere,] and accelerate their productivity by [removed: modernizing] [added: transforming] how they view, share, engage with and collaborate on documents and [removed: creative content.][added: content creation.]

[added: Our Digital Media segment is centered around Adobe Creative Cloud] and Adobe Document Cloud, which include Adobe Express, [added: Adobe Firefly,] Photoshop, Illustrator, Lightroom, Premiere Pro, Acrobat, [removed: Adobe] Acrobat Sign and many more products, offering a variety of tools for creative [removed: professionals,] [added: professionals (like photographers, video editors and game developers),] communicators and other consumers.

This is the core of what we have delivered to [added: customers and] users for decades, and we have continually evolved and expanded our [added: Digital Media] business model to provide our customers [added: and users] with a range of flexible solutions [removed: that allow them] to [added: help them] reach their full creative [removed: potential anytime, anywhere, on any device and on projects of all types.][added: potential.]

Digital Experience. We provide an integrated platform and set of [removed: applications and] [added: products,] services [added: and solutions] through Adobe Experience Cloud that enable [removed: brands and] businesses to create, manage, execute, measure, monetize and optimize customer experiences [removed: that span] [added: spanning] from analytics to commerce.

The foundation of our offering is Adobe Experience Platform, which provides businesses and brands with an open and extensible system for customer experience management that transforms customer data into robust customer profiles that update in real time and uses insights [removed: driven by artificial intelligence (“AI”)] to [removed: enable the delivery of] [added: deliver] personalized digital experiences across various [removed: channels in milliseconds.][added: channels.]

We believe we are [removed: uniquely] positioned to [removed: be a leader] [added: compete well] in both [removed: of these areas,] [added: the Digital Media and Digital Experience strategic areas] where our mission to change the world through [added: personalized] digital experiences has never been more [removed: relevant,] [added: relevant] as people seek new ways to create, collaborate and communicate and businesses continue to invest in digital transformation.

Our segments are aligned around our two strategic growth opportunities further described below, and our legacy [removed: products] [added: products, services] and solutions are contained within the third segment, Publishing and Advertising.

This overview provides an explanation of our markets and a discussion of strategic opportunities in fiscal [removed: 2023] [added: 2024] and beyond for each of our segments.

*See the section titled “Results of Operations” in Part II, Item 7 titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” [removed: of this report] and Note 2 of our Notes to Consolidated Financial Statements [added: of this report] for further segment information.*

In today’s digital world, content [removed: is] [added: and digital documents are] fueling the global [removed: economy] [added: economy,] and [added: productivity,] design and creativity have never been more relevant, providing a significant market opportunity for Adobe in digital media.

Everyone has a story to [removed: tell,] [added: tell] and [removed: they need the tools, services] [added: needs products] and [removed: capabilities] [added: services] at their fingertips to tell those stories on an ever-increasing number of [removed: canvasses.][added: canvases.]

At the same time, creativity is increasingly a team sport that is redefining productivity, making [added: quick and easy] collaboration even more critical to every company’s success.

[removed: We believe] Adobe is [removed: in a strong position] [added: driving the innovation] to [removed: address] [added: shape] these [removed: trends with innovation that will] [added: trends,] democratize creativity, [removed: empowering] [added: empower] individuals to create wherever inspiration strikes and [removed: enabling] [added: enable] more effective collaboration between creators and stakeholders.

The flagship of our Digital Media business is Adobe Creative Cloud, a subscription service that allows [removed: members] [added: subscribers] to use our creative products integrated with cloud-delivered services across [removed: desktop, web] [added: various surfaces] and [removed: mobile devices.][added: platforms.]

We believe in creativity for all, and Creative Cloud addresses the needs of all content creators, from creative professionals, such as artists, designers, developers, [removed: students] [added: students,] and administrators, to knowledge workers, marketers, educators, enthusiasts, [removed: communicators] [added: communicators,] and [added: consumers.]

[removed: Users] [added: Customers] can choose between the speed and ease of [removed: use of] Adobe Express, our [removed: task-based, template-first] [added: AI- and template-first, task-based] web and mobile [removed: application,] [added: app,] or the greater power and precision of our flagship Creative Cloud [removed: applications.][added: apps.]

Our customers rely on our products for content creation, photo editing, design, video and animation production, mobile [removed: app] [added: application (“app”)] and gaming [removed: development] [added: development,] and more.

We believe we have significant opportunities to grow [added: our Digital Media business] by advancing every creative category across [removed: devices and the web,] [added: all surfaces;] expanding content-first, task-based creativity with Adobe [removed: Express and 3D and immersive content creation with Substance 3D,] [added: Express;] enabling seamless collaboration across all [removed: stakeholders and] [added: stakeholders;] inspiring [removed: and empowering] the creative community through sharing and [removed: monetization.][added: monetization; and expanding the user base of our tools through the infusion of AI into our products, services and solutions to enable users of any skill level to easily and efficiently create content using tools like Adobe Express while also enhancing the power and AI capabilities of our flagship apps for creative professionals.]

Our Digital Media segment [removed: also] includes our Adobe Document Cloud business, a unified, cloud-based document services [removed: platform, which] [added: platform that] integrates Adobe’s pioneering PDF technology with our Acrobat and [removed: Adobe] Acrobat Sign [removed: applications] [added: apps] to deliver fully digital document [removed: workflows.][added: workflows across all surfaces.]

We have the opportunity to continue to accelerate document productivity with Adobe Document [removed: Cloud, modernizing] [added: Cloud and transform] how people view, share, [removed: collaborate] [added: collaborate,] and engage with documents.

Trillions of PDF documents are created every year, [removed: which reflects] [added: reflecting] the [removed: growing] [added: important] role PDF plays [removed: across practically every segment of the economy.][added: globally.]

There are hundreds of millions of users [removed: that] [added: who] engage with PDF files on a daily [removed: basis,] [added: basis] in industries such as legal, financial [removed: services] [added: services,] and publishing, as well as a [removed: broader] [added: broad] array of [removed: communicators and Acrobat Reader users, who can also use the expanded capabilities provided by our Acrobat applications and the document services platform found in Document Cloud.]

Our goal for our Digital Media business is to be [removed: the] [added: a] leading platform for creativity and digital document solutions, where we offer a range of products and services that allow [removed: individuals, teams, small and medium businesses, enterprises and government institutions, including both professionals and enthusiasts,] [added: anyone] to design and deliver content seamlessly.

We aim to achieve this [added: goal] by using data-driven customer engagement, driving product-led growth to [removed: make] [added: allow] our [removed: creative applications] [added: customers to create content and interact with documents in ways that are] more [removed: frictionless] [added: frictionless, efficient] and accessible, and meeting customer needs holistically to increase the value [removed: of] [added: they derive from] our [removed: products.][added: services.]

We are empowering anyone, including novice content creators, communicators and creative professionals, to create, edit, schedule and share content quickly and easily using Adobe Express, which employs [removed: powerful] capabilities from [removed: our flagship] products like Photoshop, Premiere [added: Pro] and Acrobat to deliver the best of Adobe to customers at any level.

We [removed: are continuing] [added: continue] to integrate collaboration capabilities into our [removed: applications] [added: apps] and workflows such as our native integration of Frame.io’s review and approval capabilities into Premiere [removed: Pro and] [added: Pro,] After [removed: Effects.][added: Effects, Adobe Illustrator and Adobe InDesign.]

We are pursuing new ways to inspire, empower and connect the creative community, such as through our Create Change series, our creative residency [removed: program] [added: program,] and supporting live, interactive tutorials with creators on Behance.

We also offer a range of other creative [removed: tools] [added: products] and services, including libraries of creative assets, such as Adobe Stock and Adobe [removed: Fonts;] [added: Fonts,] mobile-first apps, such as Lightroom [removed: Mobile;] [added: Mobile,] and Creative Cloud Libraries, a central place for users to store their assets.

Further descriptions of our Digital Media products are included below under “Principal [removed: Products] [added: Products, Services] and [removed: Services.”][added: Solutions.”]

In our Creative Cloud business, we employ our product-led growth strategy to minimize the friction of customer interactions and drive positive product experiences, which results in increasing customer adoption, [added: usage,] conversion, expansion and loyalty.

Our customers have the flexibility to subscribe to over twenty of our Creative Cloud products through a single subscription or, for many of our [removed: applications,] [added: apps,] through various collections of our individual [added: subscriptions to point products.]

To better serve our current users and potential users, we offer free and premium levels for certain [removed: applications,] [added: apps,] such as Adobe [added: Firefly and Adobe] Express, and targeted packages and suites, such as our Photography Plan and Substance 3D Collection.

[removed: Our] [added: The] collaboration [removed: tools] [added: features across many of our products, such as in Photoshop on the web] and [removed: services] [added: Frame.io,] help us to further expand our universe of customers beyond creative professionals to other stakeholders who use our products for review and approval, copywriting, social media marketing or other social [removed: content.][added: content creation.]

Adobe is a global technology company with a mission to change the world through personalized digital experiences.

Our products, services and solutions are used around the world to imagine, create, manage, deliver, measure, optimize and engage with content across surfaces and fuel digital experiences.

We have a diverse user base that includes consumers, communicators, creative professionals, developers, students, small and medium businesses and enterprises.

We are also empowering creators by putting the power of artificial intelligence (“AI”) in their hands, and doing so in ways we believe are responsible.

Our products and services help unleash creativity, accelerate document productivity and power businesses in a digital world.

We deliver a wide range of products, services and solutions to empower our customers and users to imagine and express ideas, create content and bring any digital experience to life.

We offer a comprehensive suite of products, services and solutions to our customers and users in our Digital Media business and Digital Experience business.

In addition, our Adobe GenStudio solution bundles together certain Digital Media

and Digital Experience products across Creative Cloud and Adobe Experience Cloud, allowing businesses to simplify their content supply chain process with generative AI capabilities and intelligent automation.

AI- and generative AI-powered technologies are increasing this opportunity by growing the demand for and production of content.

This shift is changing how creative professionals work by accelerating their processes, increasing their productivity, and allowing them to explore and create in new fields, while empowering new creators by dramatically lowering barriers to creativity.

communicators and Acrobat Reader customers who use the expanded capabilities provided by our Acrobat apps and the document services platform in Document Cloud.

We are redefining the creative process with Creative Cloud to unleash everyone’s ability to imagine and express ideas.

We are expanding the capabilities of Creative Cloud on the web with the launch of Adobe Firefly and Photoshop on the web.

We are also infusing AI into our creative apps as a co-pilot to help our customers and users work faster and smarter, with new models for images and vector graphics, and AI-powered video features natively integrated into our flagship products like Photoshop, Illustrator, and Premiere Pro.

We are building our own foundation models in areas where we have domain expertise and which we believe are most relevant to our customers.

Developing our own foundation models enables us to design Firefly to be commercially safe and in line with our AI Ethics principles of accountability, responsibility and transparency.

In fiscal 2023, we introduced other innovations, such as new Adobe Firefly models, Text-Based Editing in Premiere Pro, Generative Fill and Generative Expand in Photoshop, Generative Recolor in Illustrator and Text to Image and Text Effects in Adobe Express.

Our generative AI capabilities are increasing the value of our existing subscription products, expanding our potential customer base and increasing engagement and retention through Generative Credits—credits that provide users and subscribers the ability to generate content with Firefly.

We are driving innovation with Adobe Sensei, our cross-platform AI and machine learning technology, to make documents more intelligent and responsive.

We are unlocking business workflows through PDF and Acrobat Sign Application Programming Interfaces (“APIs”), accelerating Document Cloud adoption through digital and direct sales, and deploying diversified go-to-market motions to reach all industries and businesses of all sizes.

With over 50 million

With AI-powered automation and personalization, people and brands will increasingly stand out through unique creative expression, and the future of experiences across industries and everyday life will become increasingly personalized.

We have a strategic opportunity to provide solutions that enable real-time personalization at scale and accelerate our customers’ content supply chain, with a streamlined and coordinated process from content ideation through deployment and measurement and optimization.

Further descriptions of our Digital Experience products are included below under “Principal Products, Services and Solutions.”

Our goal is to deploy our capabilities to help enterprises generate highly engaging experiences, enable content creators to enhance creativity and scale content production, and provide marketing strategists with recommendations to improve marketing strategy and enhance the delivery of personalized customer journeys.

We believe innovations like Adobe Sensei and Adobe Sensei GenAI—our collection of natively embedded AI services in Adobe Experience Cloud that enable the delivery of more relevant and personalized customer journeys—enhance the delivery and personalization of digital experiences.

We are also building generative AI into our Adobe Experience Cloud product offerings, such as the updated Adobe Experience Manager.

*See the section titled “Risk Factors” contained in Part 1, Item 1A of this report for additional information regarding risks related to competition.*

We compete in a rapidly evolving and growing market and face significant direct or indirect competition from:

- software companies and AI companies;

- device, hardware and camera manufacturers, including those that integrate software for digital media, such as photo and video;

- proprietary and open-source web-authoring tools;

- mobile-first apps;

- web native tools and platforms;

- social media platforms that provide digital media offerings, including editing capabilities;

- providers of stock content;

- digital document creation, storage, collaboration and signing providers; and

- operating system developers that integrate digital media document viewers and markup features with their operating systems.

We believe competitive factors in our markets include:

Founded in 1982, Adobe is one of the largest and most diversified software companies in the world.

We offer a line of products and services used by creative professionals, including photographers, video editors, graphic and experience designers and game developers; communicators, including content creators, students, marketers and knowledge workers; businesses of all sizes; and consumers for creating, managing, delivering, measuring, optimizing, engaging and transacting with compelling content and experiences across personal computers, smartphones, other electronic devices and digital media formats.

In addition, we license our technology to hardware manufacturers, software developers and service providers for use in their products and solutions.

Our products run on desktop and laptop computers, smartphones, tablets, other devices and the web, depending on the product.

We have operations in the Americas; Europe, Middle East and Africa (“EMEA”); and Asia-Pacific (“APAC”).

Adobe was originally incorporated in California in October 1983 and was reincorporated in Delaware in May 1997.

Our executive offices and principal facilities are located at 345 Park Avenue, San Jose, California 95110-2704.

Our telephone number is 408-536-6000 and our website is www.adobe.com.

Investors can obtain copies of our SEC filings from our website free of charge, as well as from the SEC website at www.sec.gov.

We deliver tools and services to empower individuals to create, collaborate and express their vision, transform businesses with compelling, personalized experiences in streamlined workflows and connect communities with new levels of collaboration.

Our Digital Media segment is centered around Adobe Creative Cloud

With the creative power of our Digital Media business and the data-based tools of our Digital Experience business, we are able to offer a comprehensive suite of offerings to our customers.

Through these tools and services, we help our customers effectively make, manage, monetize and mobilize their content across channels and devices with an end-to-end workflow and feedback loop.

In addition, our ability to deliver innovation and productivity improvements across customer workflows involving the creation, management, delivery, measurement and optimization of engaging content favorably positions Adobe as our customers continue to invest in delivering digital experiences.

In a creator economy that is continually expanding, creators are looking for tools to help them easily make and share unique and beautiful content with speed and ease.

consumers.

With content creation, consumption, collaboration and monetization happening across all surfaces and media types, we aim to deliver new ways to unleash creativity and accelerate document productivity, and we believe this is an area of significant opportunity for growth through expansion of our customer base.

We continue to redefine the creative process with Creative Cloud, so that our customers can connect with everything and everyone they need to create, collaborate and be inspired.

Similarly, our new Share for Review feature in Photoshop, Illustrator and InDesign provides an efficient way for creators to seamlessly request, manage and view feedback from stakeholders that makes exporting to other formats, emailing files, tracking versions and keeping track feedback across different channels obsolete.

We are expanding the capabilities of Creative Cloud on the web with improvements to our public beta web versions of Photoshop and Illustrator, which allow subscribers to edit and review their files directly in their browser.

Other new features and solutions introduced in our products include Substance 3D Modeler, a new desktop and VR application for creating 3D objects; AI-powered quick actions and social media content scheduling in Adobe Express; direct video upload from select cameras to Frame.io with Camera to Cloud; and improved AI-powered neural filters and content-aware editing in Photoshop and Lightroom.

We are continuing to focus on democratizing 3D and immersive content creation with Adobe Aero and our Substance suite of products, as well as through integrating our Substance 3D capabilities into our other applications.

subscriptions to point products.

We use our data-driven operating model and product-led growth strategy to optimize conversion of our users of free apps and trials to paid subscribers.

We also intend to drive innovation with Adobe Sensei, our cross-platform AI and machine learning technology, to make both new and legacy documents more intelligent and responsive, unlock business workflows through PDF and Adobe Acrobat Sign APIs, accelerate Document Cloud adoption through direct sales, and leverage diversified go-to-market motions to reach all segments.

We aim to increase our reach in our key markets through the utilization of our corporate and volume licensing programs.

Digital transformation is a macro trend that affects every business, government and educational institution today—every business is a digital business.

In turn, executives, including those at the world’s leading brands, are increasingly seeking solutions that enable real-time personalization at scale.

- *Marketing workflows*.

We also believe the AI and machine learning framework enabled by our strategy with Adobe Sensei enhances the delivery of digital experiences.

Adobe Experience Cloud offers domain-specific AI services powered by Adobe Sensei that work with Adobe Experience Platform to augment existing Experience Cloud product offerings.

We also intend to focus on personalization at scale, customer engagement, growth within existing customer accounts and product differentiation.

We are continuing to add new services, functionality and features to our current offerings.

Some examples include a new algorithm in Adobe Target that utilizes machine learning to provide recommendations and tools that allow developers to optimize page load performance and deliver personalized experiences more quickly.

We are also delivering new and improved integrations, such as increased synergy between our Experience Cloud products and Creative Cloud and Adobe Acrobat Sign.

and Adobe PDF printing technologies provide advanced functionality to meet the sophisticated requirements of this marketplace.

We compete in a constantly evolving market and face significant direct or indirect competition from software companies; device, hardware and camera manufacturers; operating system developers that integrate digital imaging and image management features with their operating systems; smartphone and tablet manufacturers that integrate imaging and video software; proprietary and open source web-authoring tools; mobile-first applications; web-native tools and platforms; social media platforms that provide imaging and video offerings, including editing capabilities; stock content marketplaces; and digital document creation, storage, collaboration and signing providers.

We believe competitive factors in our markets include brand leadership, product features and functionalities; integration with related tools and third-party applications; the intuitiveness and visual appeal of user interfaces; demonstrable cost-effective benefits to customers; pricing; the flexibility of services to match changing business demands; usability and accessibility on multiple devices, including mobile and desktop; and success in educating customers in how to utilize services effectively.

We believe our greatest advantage in this space is the performance and scope of our integrated solutions, which work together as part of Creative Cloud or Document Cloud.

We are a leader through our ability to offer a very broad and comprehensive array of products and services through our Adobe Creative Cloud.

For the fiscal year ended December [removed: 2, 2022][added: 1, 2023]

The aggregate market value of the registrant’s common stock, $0.0001 par value per share, held by non-affiliates of the registrant on June [removed: 3, 2022,] [added: 2, 2023,] the last business day of the registrant’s most recently completed second fiscal quarter, was [removed: $159.00] [added: $165.53] billion (based on the closing sales price of the registrant’s common stock on that date).

As of January [removed: 6, 2023, 457.8] [added: 5, 2024, 452.0] million shares of the registrant’s common stock, $0.0001 par value per share, were issued and outstanding.

Portions of the Proxy Statement for the registrant’s [removed: 2023] [added: 2024] Annual Meeting of Stockholders (the “Proxy Statement”), to be filed within 120 days of the end of the fiscal year ended December [removed: 2, 2022,] [added: 1, 2023,] are incorporated by reference in Part III hereof.

| Item 1. | | | [removed: [Business](#iebcb91b2b75a4807a5a4d5cb7021397e_13)] [added: [Business](#id2fffb105edb44a29625d93e58bf85a1_13)] | | | [removed: [3](#iebcb91b2b75a4807a5a4d5cb7021397e_13)] [added: [3](#id2fffb105edb44a29625d93e58bf85a1_13)] | | |

| Item 1A. | | | [Risk [removed: Factors](#iebcb91b2b75a4807a5a4d5cb7021397e_49)] [added: Factors](#id2fffb105edb44a29625d93e58bf85a1_49)] | | | [removed: [20](#iebcb91b2b75a4807a5a4d5cb7021397e_49)] [added: [22](#id2fffb105edb44a29625d93e58bf85a1_49)] | | |

| Item 1B. | | | [Unresolved Staff [removed: Comments](#iebcb91b2b75a4807a5a4d5cb7021397e_52)] [added: Comments](#id2fffb105edb44a29625d93e58bf85a1_52)] | | | [removed: [34](#iebcb91b2b75a4807a5a4d5cb7021397e_52)] [added: [34](#id2fffb105edb44a29625d93e58bf85a1_52)] | | |

| Item 2. | | | [removed: [Properties](#iebcb91b2b75a4807a5a4d5cb7021397e_55)] [added: [Properties](#id2fffb105edb44a29625d93e58bf85a1_55)] | | | [removed: [34](#iebcb91b2b75a4807a5a4d5cb7021397e_55)] [added: [34](#id2fffb105edb44a29625d93e58bf85a1_55)] | | |

| Item 3. | | | [Legal [removed: Proceedings](#iebcb91b2b75a4807a5a4d5cb7021397e_61)] [added: Proceedings](#id2fffb105edb44a29625d93e58bf85a1_61)] | | | [removed: [34](#iebcb91b2b75a4807a5a4d5cb7021397e_61)] [added: [34](#id2fffb105edb44a29625d93e58bf85a1_61)] | | |

| Item 4. | | | [Mine Safety [removed: Disclosures](#iebcb91b2b75a4807a5a4d5cb7021397e_64)] [added: Disclosures](#id2fffb105edb44a29625d93e58bf85a1_64)] | | | [removed: [34](#iebcb91b2b75a4807a5a4d5cb7021397e_64)] [added: [34](#id2fffb105edb44a29625d93e58bf85a1_64)] | | |

| Item 5. | | | [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#iebcb91b2b75a4807a5a4d5cb7021397e_70)] [added: Securities](#id2fffb105edb44a29625d93e58bf85a1_70)] | | | [removed: [35](#iebcb91b2b75a4807a5a4d5cb7021397e_70)] [added: [35](#id2fffb105edb44a29625d93e58bf85a1_70)] | | |

| Item 6 | | | [removed: [\[Reserved\]](#iebcb91b2b75a4807a5a4d5cb7021397e_73)] [added: [\[Reserved\]](#id2fffb105edb44a29625d93e58bf85a1_73)] | | | [removed: [35](#iebcb91b2b75a4807a5a4d5cb7021397e_73)] [added: [35](#id2fffb105edb44a29625d93e58bf85a1_73)] | | |

| Item 7. | | | [Management's Discussion and Analysis of Financial Condition and Results of [removed: Operations](#iebcb91b2b75a4807a5a4d5cb7021397e_76)] [added: Operations](#id2fffb105edb44a29625d93e58bf85a1_76)] | | | [removed: [36](#iebcb91b2b75a4807a5a4d5cb7021397e_76)] [added: [36](#id2fffb105edb44a29625d93e58bf85a1_76)] | | |

| Item 7A. | | | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#iebcb91b2b75a4807a5a4d5cb7021397e_115)] [added: Risk](#id2fffb105edb44a29625d93e58bf85a1_112)] | | | [removed: [50](#iebcb91b2b75a4807a5a4d5cb7021397e_115)] [added: [49](#id2fffb105edb44a29625d93e58bf85a1_112)] | | |

| Item 8. | | | [Financial Statements and Supplementary [removed: Data](#iebcb91b2b75a4807a5a4d5cb7021397e_118)] [added: Data](#id2fffb105edb44a29625d93e58bf85a1_115)] | | | [removed: [52](#iebcb91b2b75a4807a5a4d5cb7021397e_118)] [added: [51](#id2fffb105edb44a29625d93e58bf85a1_115)] | | |

| Item 9. | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#iebcb91b2b75a4807a5a4d5cb7021397e_211)] [added: Disclosure](#id2fffb105edb44a29625d93e58bf85a1_208)] | | | [removed: [92](#iebcb91b2b75a4807a5a4d5cb7021397e_211)] [added: [92](#id2fffb105edb44a29625d93e58bf85a1_208)] | | |

| Item 9A. | | | [Controls and [removed: Procedures](#iebcb91b2b75a4807a5a4d5cb7021397e_214)] [added: Procedures](#id2fffb105edb44a29625d93e58bf85a1_211)] | | | [removed: [92](#iebcb91b2b75a4807a5a4d5cb7021397e_214)] [added: [92](#id2fffb105edb44a29625d93e58bf85a1_211)] | | |

| Item 9B. | | | [Other [removed: Information](#iebcb91b2b75a4807a5a4d5cb7021397e_217)] [added: Information](#id2fffb105edb44a29625d93e58bf85a1_214)] | | | [removed: [92](#iebcb91b2b75a4807a5a4d5cb7021397e_217)] [added: [92](#id2fffb105edb44a29625d93e58bf85a1_214)] | | |

| Item 9C. | | | [Disclosure Regarding Foreign Jurisdictions That Prevent [removed: Inspections](#iebcb91b2b75a4807a5a4d5cb7021397e_2044)] [added: Inspections](#id2fffb105edb44a29625d93e58bf85a1_217)] | | | [removed: [92](#iebcb91b2b75a4807a5a4d5cb7021397e_2044)] [added: [92](#id2fffb105edb44a29625d93e58bf85a1_217)] | | |

| Item 10. | | | [Directors, Executive Officers and Corporate [removed: Governance](#iebcb91b2b75a4807a5a4d5cb7021397e_223)] [added: Governance](#id2fffb105edb44a29625d93e58bf85a1_223)] | | | [removed: [93](#iebcb91b2b75a4807a5a4d5cb7021397e_223)] [added: [93](#id2fffb105edb44a29625d93e58bf85a1_223)] | | |

| Item 11. | | | [Executive [removed: Compensation](#iebcb91b2b75a4807a5a4d5cb7021397e_226)] [added: Compensation](#id2fffb105edb44a29625d93e58bf85a1_226)] | | | [removed: [93](#iebcb91b2b75a4807a5a4d5cb7021397e_226)] [added: [93](#id2fffb105edb44a29625d93e58bf85a1_226)] | | |

| Item 12. | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#iebcb91b2b75a4807a5a4d5cb7021397e_229)] [added: Matters](#id2fffb105edb44a29625d93e58bf85a1_229)] | | | [removed: [93](#iebcb91b2b75a4807a5a4d5cb7021397e_229)] [added: [93](#id2fffb105edb44a29625d93e58bf85a1_229)] | | |

| Item 13. | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#iebcb91b2b75a4807a5a4d5cb7021397e_232)] [added: Independence](#id2fffb105edb44a29625d93e58bf85a1_232)] | | | [removed: [93](#iebcb91b2b75a4807a5a4d5cb7021397e_232)] [added: [93](#id2fffb105edb44a29625d93e58bf85a1_232)] | | |

| Item 14. | | | [Principal [removed: Accounting Fees] [added: Account](#id2fffb105edb44a29625d93e58bf85a1_235)[ant](#id2fffb105edb44a29625d93e58bf85a1_235) [Fees] and [removed: Services](#iebcb91b2b75a4807a5a4d5cb7021397e_235)] [added: Services](#id2fffb105edb44a29625d93e58bf85a1_235)] | | | [removed: [93](#iebcb91b2b75a4807a5a4d5cb7021397e_235)] [added: [93](#id2fffb105edb44a29625d93e58bf85a1_235)] | | |

| Item 15. | | | [Exhibits, Financial Statement [removed: Schedules](#iebcb91b2b75a4807a5a4d5cb7021397e_241)] [added: Schedules](#id2fffb105edb44a29625d93e58bf85a1_241)] | | | [removed: [94](#iebcb91b2b75a4807a5a4d5cb7021397e_241)] [added: [94](#id2fffb105edb44a29625d93e58bf85a1_241)] | | |

| Item 16. | | | [Form 10-K [removed: Summary](#iebcb91b2b75a4807a5a4d5cb7021397e_247)] [added: Summary](#id2fffb105edb44a29625d93e58bf85a1_247)] | | | [removed: [96](#iebcb91b2b75a4807a5a4d5cb7021397e_247)] [added: [96](#id2fffb105edb44a29625d93e58bf85a1_247)] | | |

| [removed: [Signatures](#iebcb91b2b75a4807a5a4d5cb7021397e_250)] [added: [Signatures](#id2fffb105edb44a29625d93e58bf85a1_250)] | | | | | | [removed: [97](#iebcb91b2b75a4807a5a4d5cb7021397e_250)] [added: [97](#id2fffb105edb44a29625d93e58bf85a1_250)] | | |

| [Summary of [removed: Trademarks](#iebcb91b2b75a4807a5a4d5cb7021397e_253)] [added: Trademarks](#id2fffb105edb44a29625d93e58bf85a1_253)] | | | | | | [removed: [99](#iebcb91b2b75a4807a5a4d5cb7021397e_253)] [added: [99](#id2fffb105edb44a29625d93e58bf85a1_253)] | | |

*In addition to historical information, this Annual Report on Form 10-K contains [removed: forward-looking statements,] [added: “forward-looking statements,” within the meaning of applicable securities laws,] including statements [removed: regarding] [added: related to] product [removed: plans,] [added: development plans and new or enhanced offerings; our business, artificial intelligence and innovation momentum; our vision for the digital world, innovation and AI; our market opportunity and] future growth, market [removed: opportunities, fluctuations in foreign currency exchange rates,] [added: and AI trends,] strategic [removed: investments, industry positioning, customer acquisition] [added: investments; revenue, operating margin, operating efficiencies] and [removed: retention, the amount of] annualized recurring [removed: revenue, revenue growth] [added: revenue; industry positioning;] and [removed: anticipated impacts on our business of the ongoing COVID-19 pandemic] [added: customer acquisition] and [removed: related public health measures.][added: retention.]

[removed: Each of the forward-looking statements we make in this report involves] [added: Such] risks and [removed: uncertainties that] [added: uncertainties, many of which relate to matters beyond our control,] could cause actual results to differ materially [added: and adversely] from these forward-looking statements.

Factors that might cause or contribute to such differences include, but are not limited to, those discussed in the section titled “Risk Factors” in Part I, Item 1A of this [removed: report.][added: report and elsewhere herein.]

The risks described herein and in [added: Adobe’s] other [removed: documents we file from time to time] [added: filings] with the U.S. Securities and Exchange Commission (the “SEC”), including our Quarterly Reports on Form 10-Q to be filed in fiscal [removed: 2023,] [added: 2024,] should be carefully reviewed.

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

| Item 1C. | | | [Cybersecu](#id2fffb105edb44a29625d93e58bf85a1_2085)[rity](#id2fffb105edb44a29625d93e58bf85a1_2085) | | | [34](#id2fffb105edb44a29625d93e58bf85a1_2085) | | |

Each of the forward-looking statements we make in this report are based on information available to us as of the date of this report and involves risks, uncertainties and assumptions based on information available to us as of the date of this report.

Undue reliance should not be placed on the financial information set forth in this report, which reflects estimates based on information available at this time.

Adobe assumes no obligation to, and does not currently intend to, update these forward-looking statements.*

Undue reliance should not be placed on these forward-looking statements, which speak only as of the date of this Annual Report on Form 10-K.

We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document, except as required by law.*

Not applicable.

Our corporate headquarters is located in San Jose, California where we occupy approximately [removed: 1.1] [added: 1.7] million square feet of office [removed: space as of December 2, 2022.][added: space.]

We own [removed: a substantial portion] [added: all] of our San Jose, California properties which we use for research, product development, sales, marketing and administrative purposes.

Outside of the United States, we own and lease properties throughout [removed: EMEA] [added: Europe, Middle East] and [removed: APAC] [added: Africa (“EMEA”) and Asia-Pacific (“APAC”)] for research, product development, [removed: sales] [added: sales, marketing] and administrative purposes.

The largest properties we occupy outside of the United States are our Bangalore, India and Noida, India offices which are approximately [removed: 0.4] [added: 0.7] million and 0.5 million square feet, respectively.

*[See Note 18 of our Notes to Consolidated Financial Statements for further information regarding our lease [removed: obligations.](#iebcb91b2b75a4807a5a4d5cb7021397e_199)*][added: obligations.](#id2fffb105edb44a29625d93e58bf85a1_196)*]

During fiscal 2023, we continued to operate under a hybrid work model.

Construction of a new building at our corporate headquarters in San Jose, California is substantially complete and was opened for occupancy in January 2023.

We have ongoing building construction in Bangalore, India which is currently targeted for completion in fiscal 2023.

During fiscal 2022, we fully re-opened our offices and evolved to a hybrid work model.

According to the records of our transfer agent, there were [removed: 928] [added: 905] holders of record of our common stock on January [removed: 6, 2023.][added: 5, 2024.]

Below is a summary of stock repurchases for the three months ended December [removed: 2, 2022.][added: 1, 2023.]

*[See Note 14 of our Notes to Consolidated Financial Statements for information regarding our stock repurchase [removed: programs.](#iebcb91b2b75a4807a5a4d5cb7021397e_187)*][added: programs.](#id2fffb105edb44a29625d93e58bf85a1_184)*]

| Beginning repurchase authority | | | | | | | | | | | | | | | | | | | | | | | | $ | [removed: 8,700] [added: 3,483] | | | | |

| October [removed: 29] [added: 28] — December [removed: 2, 2022] [added: 1, 2023] | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

(2)In September [removed: 2022,] [added: 2023,] we entered into a structured stock repurchase agreement with a large financial institution whereupon we provided them with a prepayment of [removed: $1.75] [added: $1] billion.

As of December [removed: 2, 2022,] [added: 1, 2023,] approximately [removed: $583] [added: $354] million of the prepayment remained under this agreement.

| September 2 — September 29, 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Shares repurchased | | | | | | 0.6 | | | | | | $ | 538.26 | | | | | 0.6 | | | | | | $ | (333) | | | | |

| September 30 — October 27, 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Shares repurchased | | | | | | 0.6 | | | | | | $ | 521.39 | | | | | 0.6 | | | | | | $ | (328) | | (2) | | |

| Shares repurchased | | | | | | 0.6 | | | | | | $ | 536.94 | | | | | 0.6 | | | | | | $ | (318) | | (2) | | |

| Total | | | | | | 1.8 | | | | | | | | | | | | 1.8 | | | | | | $ | 2,504 | | | | |

| September 3 — September 30, 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Shares repurchased | | | | | | 1.1 | | | | | | $ | 371.04 | | | | | 1.1 | | | | | | $ | (400) | | | | |

| October 1 — October 28, 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Shares repurchased | | | | | | 2.1 | | | | | | $ | 285.40 | | | | | 2.1 | | | | | | $ | (584) | | (2) | | |

| Shares repurchased | | | | | | 1.8 | | | | | | $ | 317.04 | | | | | 1.8 | | | | | | $ | (583) | | (2) | | |

| Total | | | | | | 5.0 | | | | | | | | | | | | 5.0 | | | | | | $ | 7,133 | | | | |

| [Consolidated Balance [removed: Sheets](#iebcb91b2b75a4807a5a4d5cb7021397e_121)] [added: Sheets](#id2fffb105edb44a29625d93e58bf85a1_118)] | | | [removed: [53](#iebcb91b2b75a4807a5a4d5cb7021397e_121)] [added: [52](#id2fffb105edb44a29625d93e58bf85a1_118)] | | |

| [Consolidated Statements of [removed: Income](#iebcb91b2b75a4807a5a4d5cb7021397e_124)] [added: Comprehensive Income](#id2fffb105edb44a29625d93e58bf85a1_124)] | | | [removed: [54](#iebcb91b2b75a4807a5a4d5cb7021397e_124)] [added: [54](#id2fffb105edb44a29625d93e58bf85a1_124)] | | |

| [Consolidated Statements of Stockholders' [removed: Equity](#iebcb91b2b75a4807a5a4d5cb7021397e_130)] [added: Equity](#id2fffb105edb44a29625d93e58bf85a1_127)] | | | [removed: [56](#iebcb91b2b75a4807a5a4d5cb7021397e_130)] [added: [55](#id2fffb105edb44a29625d93e58bf85a1_127)] | | |

| [Consolidated Statements of Cash [removed: Flows](#iebcb91b2b75a4807a5a4d5cb7021397e_133)] [added: Flows](#id2fffb105edb44a29625d93e58bf85a1_130)] | | | [removed: [57](#iebcb91b2b75a4807a5a4d5cb7021397e_133)] [added: [56](#id2fffb105edb44a29625d93e58bf85a1_130)] | | |

[removed: | [Notes to Consolidated Financial Statements](#iebcb91b2b75a4807a5a4d5cb7021397e_136) | | | [58](#iebcb91b2b75a4807a5a4d5cb7021397e_136) | | |][added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)]

| [Report [removed: of](#iebcb91b2b75a4807a5a4d5cb7021397e_208) [Independent] [added: of Independent] Registered Public Accounting [removed: Firm](#iebcb91b2b75a4807a5a4d5cb7021397e_208)] [added: Firm](#id2fffb105edb44a29625d93e58bf85a1_205)] (KPMG [removed: LLP[,](#iebcb91b2b75a4807a5a4d5cb7021397e_208)] [added: LLP[,](#id2fffb105edb44a29625d93e58bf85a1_205)] Santa Clara, [removed: California[,](#iebcb91b2b75a4807a5a4d5cb7021397e_208)] [added: California[,](#id2fffb105edb44a29625d93e58bf85a1_205)] PCAOB ID 185) | | | [removed: [90](#iebcb91b2b75a4807a5a4d5cb7021397e_208)] [added: [90](#id2fffb105edb44a29625d93e58bf85a1_205)] | | |

| | | | December [added: 1, 2023 | | | | | | December] 2, 2022 | | | | | | December 3, 2021 | | |

| Cash and cash equivalents | | | $ | [removed: 4,236] [added: 7,141] | | | | | $ | [removed: 3,844] [added: 4,236] | |

| Short-term investments | | | [removed: 1,860] [added: 701] | | | | | | [removed: 1,954] [added: 1,860] | | |

| Trade receivables, net of allowances for doubtful accounts of [removed: $23] [added: $16] and of [removed: $16,] [added: $23,] respectively | | | [removed: 2,065] [added: 2,224] | | | | | | [removed: 1,878] [added: 2,065] | | |

| Prepaid expenses and other current assets | | | [removed: 835] [added: 1,018] | | | | | | [removed: 993] [added: 835] | | |

| Total current assets | | | [removed: 8,996] [added: 11,084] | | | | | | [removed: 8,669] [added: 8,996] | | |

| Property and equipment, net | | | [removed: 1,908] [added: 2,030] | | | | | | [removed: 1,673] [added: 1,908] | | |

| Operating lease right-of-use assets, net | | | [removed: 407] [added: 358] | | | | | | [removed: 443] [added: 407] | | |

| Goodwill | | | [removed: 12,787] [added: 12,805] | | | | | | [removed: 12,668] [added: 12,787] | | |

| Other intangibles, net | | | [removed: 1,449] [added: 1,088] | | | | | | [removed: 1,820] [added: 1,449] | | |

| Deferred income taxes | | | [removed: 777] [added: 1,191] | | | | | | [removed: 1,085] [added: 777] | | |

| Other assets | | | [removed: 841] [added: 1,223] | | | | | | [removed: 883] [added: 841] | | |

| Total assets | | | $ | [removed: 27,165] [added: 29,779] | | | | | $ | [removed: 27,241] [added: 27,165] | |

| Trade payables | | | $ | [removed: 379] [added: 314] | | | | | $ | [removed: 312] [added: 379] | |

| Accrued expenses | | | [removed: 1,790] [added: 1,942] | | | | | | [removed: 1,736] [added: 1,790] | | |

| Debt | | | [removed: 500] [added: —] | | | | | | [removed: —] [added: 500] | | |

| Deferred revenue | | | [removed: 5,297] [added: 5,837] | | | | | | [removed: 4,733] [added: 5,297] | | |

| Income taxes payable | | | [removed: 75] [added: 85] | | | | | | [removed: 54] [added: 75] | | |

| Operating lease liabilities | | | [removed: 87] [added: 73] | | | | | | [removed: 97] [added: 87] | | |

| Total current liabilities | | | [removed: 8,128] [added: 8,251] | | | | | | [removed: 6,932] [added: 8,128] | | |

| Debt | | | [removed: 3,629] [added: 3,634] | | | | | | [removed: 4,123] [added: 3,629] | | |

| Deferred revenue | | | [removed: 117] [added: 113] | | | | | | [removed: 145] [added: 117] | | |

| Income taxes payable | | | [removed: 530] [added: 514] | | | | | | [removed: 534] [added: 530] | | |

| Operating lease liabilities | | | [removed: 417] [added: 373] | | | | | | [removed: 453] [added: 417] | | |

| Other liabilities | | | [removed: 293] [added: 376] | | | | | | [removed: 257] [added: 293] | | |

| Total liabilities | | | [removed: 13,114] [added: 13,261] | | | | | | [removed: 12,444] [added: 13,114] | | |

| Common stock, $0.0001 par value; 900 shares authorized; 601 shares issued; [removed: 462] [added: 455] and [removed: 475] [added: 462] shares outstanding, respectively | | | — | | | | | | — | | |

| Additional paid-in-capital | | | [removed: 9,868] [added: 11,586] | | | | | | [removed: 8,428] [added: 9,868] | | |

| Retained earnings | | | [removed: 28,319] [added: 33,346] | | | | | | [removed: 23,905] [added: 28,319] | | |

| Accumulated other comprehensive income (loss) | | | [removed: (293)] [added: (285)] | | | | | | [removed: (137)] [added: (293)] | | |

| Treasury stock, at cost [removed: (139] [added: (146] and [removed: 126] [added: 139] shares, respectively) | | | [removed: (23,843)] [added: (28,129)] | | | | | | [removed: (17,399)] [added: (23,843)] | | |

| Total stockholders’ equity | | | [removed: 14,051] [added: 16,518] | | | | | | [removed: 14,797] [added: 14,051] | | |

| Total liabilities and stockholders’ equity | | | $ | [removed: 27,165] [added: 29,779] | | | | | $ | [removed: 27,241] [added: 27,165] | |

| | | | December [removed: 2, 2022] [added: 1, 2023] | | | | | | December [removed: 3, 2021] [added: 2, 2022] | | | | | | [removed: November 27, 2020] [added: December 3, 2021] | | |

| [Consolidated Statements of Income](#id2fffb105edb44a29625d93e58bf85a1_121) | | | [53](#id2fffb105edb44a29625d93e58bf85a1_121) | | |

| [Notes to Consolidated Financial Statements](#id2fffb105edb44a29625d93e58bf85a1_133) | | | [57](#id2fffb105edb44a29625d93e58bf85a1_133) | | |

| | | | December 1, 2023 | | | | | | December 2, 2022 | | |

| Balances at December 1, 2023 | | | | | | 601 | | | | | | $ | — | | | | | $ | 11,586 | | | | | $ | 33,346 | | | | | $ | (285) | | | | | (146) | | | | | | $ | (28,129) | | | | | $ | 16,518 | |

| | | | December 1, 2023 | | | | | | December 2, 2022 | | | | | | December 3, 2021 | | |

| Net income | | | $ | 5,428 | | | | | $ | 4,756 | | | | | $ | 4,822 | |

Adobe is a global technology company with a mission to change the world through personalized digital experiences.

For over four decades, Adobe’s innovations have transformed how individuals, teams, businesses, enterprises, institutions, and governments engage and interact across all types of media.

Our products, services and solutions are used around the world to imagine, create, manage, deliver, measure, optimize and engage with content across surfaces and fuel digital experiences.

We have a diverse user base that includes consumers, communicators, creative professionals, developers, students, small and medium businesses and enterprises.

We are also empowering creators by putting the power of artificial intelligence (“AI”) in their hands, and doing so in ways we believe are responsible.

Our products and services help unleash creativity, accelerate document productivity and power businesses in a digital world.

We enter into revenue arrangements in which a customer may purchase a combination of our products, services and/or solutions as described above.

Periods of time after the right of

To determine the fair values, we use the equal weighting of the market approach based on comparable publicly traded

We also enter into collateral security agreements with certain of our counterparties

In November 2023, the Financial Accounting Standards Board issued Accounting Standards Update No. 2023-07, Segment Reporting, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses.

The updated standard is effective for our annual periods beginning in fiscal 2025 and interim periods beginning in the first quarter of fiscal 2026.

Early adoption is permitted.

We are currently evaluating the impact that the updated standard will have on our financial statement disclosures.

| Revenue | | | $ | 14,216 | | | | | $ | 4,893 | | | | | $ | 300 | | | | | $ | 19,409 | |

| Cost of revenue | | | 665 | | | | | | 1,603 | | | | | | 86 | | | | | | 2,354 | | |

| Gross profit | | | $ | 13,551 | | | | | $ | 3,290 | | | | | $ | 214 | | | | | $ | 17,055 | |

On December 17, 2023, we entered into a mutual termination agreement with Figma to terminate the proposed merger.

In accordance with the terms of the termination agreement, on December 20, 2023, we paid Figma a termination fee of $1 billion, which we recorded in operating expenses in the first quarter of fiscal year 2024.

| Cash | | | $ | 618 | | | | | $ | — | | | | | $ | — | | | | | $ | 618 | |

| U.S. agency securities | | | 13 | | | | | | — | | | | | | (1) | | | | | | 12 | | |

| Total | | | | | | | | | $ | 701 | |

| U.S. agency securities | | | 12 | | | | | | — | | | | | | 12 | | | | | | — | | |

| Total assets | | | $ | 7,482 | | | | | $ | 6,729 | | | | | $ | 753 | | | | | $ | — | |

*[See Note 17 for further details regarding our debt.](#id2fffb105edb44a29625d93e58bf85a1_193)*

| *(in millions)* | | | 2023 | | | | | | | | | | | | 2022 | | | | | | | | |

| Foreign exchange forward contracts | | | | | | | | | | | | | | | | | | | | | | | |

| Net gain (loss) reclassified from accumulated OCI into income | | | Operating expenses | | | | | | $ | (2) | | | | | $ | — | | | | | $ | — | |

| *(in millions)* | | | | | | 2023 | | | | | | 2022 | | |

| *(in millions)* | | | | | | 2023 | | | | | | 2022 | | | | | | | | |

| *(in millions)* | | | Digital Media | | | | | | Digital Experience | | | | | | Publishing and Advertising | | | | | | Total Goodwill | | |

| Balances at December 3, 2021 | | | $ | 3,731 | | | | | $ | 8,539 | | | | | $ | 398 | | | | | $ | 12,668 | |

| Acquisitions | | | 161 | | | | | | — | | | | | | — | | | | | | 161 | | |

| Balances at December 2, 2022 | | | $ | 3,889 | | | | | $ | 8,500 | | | | | $ | 398 | | | | | $ | 12,787 | |

| [Consolidated Statements of Comprehensive Income](#iebcb91b2b75a4807a5a4d5cb7021397e_127) | | | [55](#iebcb91b2b75a4807a5a4d5cb7021397e_127) | | |

| Balances at November 29, 2019 | | | | | | 601 | | | | | | $ | — | | | | | $ | 6,504 | | | | | $ | 14,829 | | | | | $ | (188) | | | | | (118) | | | | | | $ | (10,615) | | | | | $ | 10,530 | |

| Proceeds from issuance of debt | | | — | | | | | | — | | | | | | 3,144 | | |

Founded in 1982, Adobe is one of the largest and most diversified software companies in the world.

We offer a line of products and services used by creative professionals, including photographers, video editors, graphic and experience designers and game developers; communicators, including content creators, students, marketers and knowledge workers; businesses of all sizes; and consumers for creating, managing, delivering, measuring, optimizing, engaging and transacting with compelling content and experiences across personal computers, smartphones, other electronic devices and digital media formats.

We market our products and services directly to enterprise customers through our sales force and local field offices.

We license our products to end users through app stores and our own website at www.adobe.com.

We offer many of our products via a Software-as-a-Service (“SaaS”) model or a managed services model (both of which are referred to as hosted or cloud-based) as well as through term subscription and pay-per-use models.

We also distribute certain products and services through a network of distributors, value-added resellers (“VARs”), systems integrators (“SIs”), independent software vendors (“ISVs”), retailers, software developers and original equipment manufacturers (“OEMs”).

In addition, we license our technology to hardware manufacturers, software developers and service providers for use in their products and solutions.

Our products run on desktop and laptop computers, smartphones, tablets, other devices and the web, depending on the product.

*Reclassifications*

Certain prior year amounts, which are not material, have been reclassified to conform to current year presentation in the Consolidated Balance Sheets and Notes to Consolidated Financial Statements.

capable of being distinct and accounted for as separate performance obligations, or in the case of offerings such as cloud-enabled Creative Cloud and Document Cloud, accounted for as a single performance obligation.

We enter into revenue arrangements in which a customer may purchase a combination of cloud-enabled subscriptions, cloud-hosted offerings, term-based, royalty, and perpetual software licenses, associated software maintenance and support plans, consulting services, training and technical support.

each other, and therefore part of a single performance obligation, may require significant judgment.

percent of revenue to determine a historical reserve rate.

In performing our goodwill impairment test, we first perform a qualitative assessment, which requires that we consider events or

Prior year amounts have been recast to conform to current year presentation, which reflect changes to modernize the categorization of costs reported as advertising expenses, primarily associated with the inclusion of certain digital advertising costs.

There was no impact to the Consolidated Statements of Income resulting from this change.

| Fiscal 2020 | | | | | | | | | | | | | | | | | | | | | | | |

| Revenue | | | $ | 9,233 | | | | | $ | 3,125 | | | | | $ | 510 | | | | | $ | 12,868 | |

| Cost of revenue | | | 352 | | | | | | 1,126 | | | | | | 244 | | | | | | 1,722 | | |

| Gross profit | | | $ | 8,881 | | | | | $ | 1,999 | | | | | $ | 266 | | | | | $ | 11,146 | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

Approximately 6 million additional restricted stock units will be granted to Figma’s Chief Executive Officer and employees that will vest over four years subsequent to closing.

The transaction is subject to regulatory approvals and customary closing conditions, and is expected to close in 2023.

We will be required to pay Figma a reverse termination fee of $1 billion if the transaction fails to receive regulatory clearance, assuming all other closing conditions have been satisfied or waived, or if it fails to close within 18 months from September 15, 2022.

Figma is a privately held company that provides a web-first collaborative product design platform.

Following the closing, we intend to integrate Figma into our Digital Media reportable segment for financial reporting purposes.

During fiscal 2022, we recorded purchase accounting adjustments that were not material based on changes to management’s estimates and assumptions primarily in regards to the total purchase price and its related impact to goodwill.

_________________________________________

| Cash | | | $ | 750 | | | | | $ | — | | | | | $ | — | | | | | $ | 750 | |

| Municipal securities | | | 28 | | | | | | — | | | | | | — | | | | | | 28 | | |

| Due after three years | | | | | | | | | 9 | | |

| Total | | | | | | | | | $ | 1,860 | |

| Corporate debt securities | | | $ | 5 | | | | | $ | — | | | | | $ | 5 | | | | | $ | — | |

| Corporate debt securities | | | 1,425 | | | | | | — | | | | | | 1,425 | | | | | | — | | |

| Municipal securities | | | 28 | | | | | | — | | | | | | 28 | | | | | | — | | |

| Total assets | | | $ | 5,297 | | | | | $ | 3,240 | | | | | $ | 2,057 | | | | | $ | — | |

Our management has evaluated, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures as of December [removed: 2, 2022.][added: 1, 2023.]

Based on their evaluation as of December [removed: 2, 2022,] [added: 1, 2023,] our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) were effective at the reasonable assurance level to ensure that the information required to be disclosed by us in this Annual Report on Form 10-K was (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and regulations and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

Our management assessed the effectiveness of our internal control over financial reporting as of December [removed: 2, 2022.][added: 1, 2023.]

Our management has concluded that, as of December [removed: 2, 2022,] [added: 1, 2023,] our internal control over financial reporting [removed: are] [added: is] effective based on these criteria.

There were no changes in our internal control over financial reporting during the quarter ended December [removed: 2, 2022] [added: 1, 2023] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

The information required by this Item 10 of Form 10-K that is found in our [removed: 2023] [added: 2024] Proxy Statement to be filed with the SEC in connection with the solicitation of proxies for the Company’s [removed: 2023] [added: 2024] Annual Meeting of Stockholders [removed: (“2023] [added: (“2024] Proxy Statement”) is incorporated herein by reference to our [removed: 2023] [added: 2024] Proxy Statement.

The [removed: 2023] [added: 2024] Proxy Statement will be filed with the SEC within 120 days after the end of the fiscal year to which this report relates.

For information with respect to our executive officers, [see the section titled “Executive [removed: Officers”](#iebcb91b2b75a4807a5a4d5cb7021397e_46)] [added: Officers”](#id2fffb105edb44a29625d93e58bf85a1_46)] in [Part I, Item [removed: 1](#iebcb91b2b75a4807a5a4d5cb7021397e_46)] [added: 1](#id2fffb105edb44a29625d93e58bf85a1_46)] of this report.

The information required by this Item 11 of Form 10-K is incorporated herein by reference to our [removed: 2023] [added: 2024] Proxy Statement.

The information required by this Item 12 of Form 10-K is incorporated herein by reference to our [removed: 2023] [added: 2024] Proxy Statement.

The information required by this Item 13 of Form 10-K is incorporated herein by reference to our [removed: 2023] [added: 2024] Proxy Statement.

The information required by this Item 14 of Form 10-K is incorporated herein by reference to our [removed: 2023] [added: 2024] Proxy Statement.

[See Index to Consolidated Financial Statements in Part II, Item [removed: 8](#iebcb91b2b75a4807a5a4d5cb7021397e_118)] [added: 8](#id2fffb105edb44a29625d93e58bf85a1_115)] of this Form 10-K.

| 4.5 | | | | | | [Description of Adobe’s Common [removed: Stock](https://www.sec.gov/Archives/edgar/data/796343/000079634323000007/adbeex45fy22.htm)] [added: Stock](https://www.sec.gov/Archives/edgar/data/796343/000079634324000006/adbeex45fy23.htm)] | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | X | | |

| 10.3A | | | | | | [2019 Equity Incentive Plan, as [removed: amended*](http://www.sec.gov/Archives/edgar/data/796343/000079634319000091/ex101-2019.htm)] [added: amended*](https://www.sec.gov/Archives/edgar/data/796343/000079634323000084/adbeex1018-k42423.htm)] | | | | | | 8-K | | | | | | [removed: 4/12/19] [added: 4/24/23] | | | | | | 10.1 | | | | | | 000-15175 | | | | | | | | |

| 10.3B | | | | | | [removed: [2020] [added: [2021] Performance Share Program pursuant to the 2019 Equity Incentive [removed: Plan*](http://www.sec.gov/Archives/edgar/data/796343/000079634320000040/adbeex1028-k.htm)] [added: Plan*](http://www.sec.gov/Archives/edgar/data/796343/000079634321000028/adbeex1028-k.htm)] | | | | | | 8-K | | | | | | [removed: 1/30/20] [added: 1/27/21] | | | | | | 10.2 | | | | | | 000-15175 | | | | | | | | |

| 10.3C | | | | | | [Form of [removed: 2020] [added: 2021] Performance Share Award Grant Notice and Award Agreement pursuant to [removed: 2020] [added: 2021] Performance Share Program and 2019 Equity Incentive [removed: Plan*](http://www.sec.gov/Archives/edgar/data/796343/000079634320000040/adbeex1038-k.htm)] [added: Plan*](http://www.sec.gov/Archives/edgar/data/796343/000079634321000028/adbeex1038-k.htm)] | | | | | | 8-K | | | | | | [removed: 1/30/20] [added: 1/27/21] | | | | | | 10.3 | | | | | | 000-15175 | | | | | | | | |

| 10.3D | | | | | | [removed: [2021] [added: [2022] Performance Share Program pursuant to the 2019 Equity Incentive [removed: Plan*](http://www.sec.gov/Archives/edgar/data/796343/000079634321000028/adbeex1028-k.htm)] [added: Plan*](https://www.sec.gov/Archives/edgar/data/796343/000079634322000056/adbeex1028-k12722.htm)] | | | | | | 8-K | | | | | | [removed: 1/27/21] [added: 1/27/22] | | | | | | 10.2 | | | | | | 000-15175 | | | | | | | | |

| [removed: 10.3E] [added: 10.3F] | | | | | | [Form of [removed: 2021] [added: 2022] Performance Share Award Grant Notice and Award Agreement pursuant to [removed: 2021] [added: 2022] Performance Share Program and 2019 Equity Incentive [removed: Plan*](http://www.sec.gov/Archives/edgar/data/796343/000079634321000028/adbeex1038-k.htm)] [added: Plan*](https://www.sec.gov/Archives/edgar/data/796343/000079634322000056/adbeex1038-k12722.htm)] | | | | | | 8-K | | | | | | [removed: 1/27/21] [added: 1/27/22] | | | | | | 10.3 | | | | | | 000-15175 | | | | | | | | |

| [removed: 10.3F] [added: 10.3H] | | | | | | [removed: [2022] [added: [2023] Performance Share Program pursuant to [removed: the 2019 Equity] [added: 2019](https://www.sec.gov/Archives/edgar/data/796343/000079634323000011/adbe8-kex10212623.htm) [Equity] Incentive [removed: Plan*](https://www.sec.gov/Archives/edgar/data/796343/000079634322000056/adbeex1028-k12722.htm)] [added: Plan*](https://www.sec.gov/Archives/edgar/data/796343/000079634323000011/adbe8-kex10212623.htm)] | | | | | | 8-K | | | | | | [removed: 1/27/22] [added: 1/26/23] | | | | | | 10.2 | | | | | | 000-15175 | | | | | | | | |

| [removed: 10.3G] [added: 10.3I] | | | | | | [removed: [Form] [added: [F](https://www.sec.gov/Archives/edgar/data/796343/000079634323000011/adbe8-kex10312623.htm)[orm] of [removed: 2022] [added: 2023] Performance [removed: Share Award] [added: Share](https://www.sec.gov/Archives/edgar/data/796343/000079634323000011/adbe8-kex10312623.htm) [Award] Grant Notice and Award Agreement pursuant to [removed: 2022] [added: 2023] Performance Share Program and 2019 Equity Incentive [removed: Plan*](https://www.sec.gov/Archives/edgar/data/796343/000079634322000056/adbeex1038-k12722.htm)] [added: Plan](https://www.sec.gov/Archives/edgar/data/796343/000079634323000011/adbe8-kex10312623.htm)[*](https://www.sec.gov/Archives/edgar/data/796343/000079634323000011/adbe8-kex10312623.htm)] | | | | | | 8-K | | | | | | [removed: 1/27/22] [added: 1/26/23] | | | | | | 10.3 | | | | | | 000-15175 | | | | | | | | |

| [removed: 10.3H] [added: 10.3G] | | | | | | [Form of Restricted Stock Unit Grant Notice and Award Agreement pursuant to 2019 Equity Incentive Plan (for awards granted prior to January 15, 2021)*](http://www.sec.gov/Archives/edgar/data/796343/000079634319000142/adbeex1035bq219.htm) | | | | | | 10-Q | | | | | | 6/26/19 | | | | | | 10.35B | | | | | | 000-15175 | | | | | | | | |

| [removed: 10.3I] [added: 10.3J] | | | | | | [Form of Restricted Stock Unit Grant Notice and Award Agreement pursuant to 2019 Equity Incentive Plan (for awards granted on or after January 15, 2021)*](http://www.sec.gov/Archives/edgar/data/796343/000079634321000004/adbeex103efy20.htm) | | | | | | 10-K | | | | | | 1/15/21 | | | | | | 10.3E | | | | | | 000-15175 | | | | | | | | |

| [removed: 10.3J] [added: 10.3K] | | | | | | [Form [removed: of Director] [added: of](https://www.sec.gov/Archives/edgar/data/796343/000079634323000055/adbeex107q123.htm) [Non-Employee](https://www.sec.gov/Archives/edgar/data/796343/000079634323000055/adbeex107q123.htm) [Director] Grant Restricted Stock Unit Grant Notice and Award Agreement pursuant to 2019 Equity Incentive [removed: Plan*](http://www.sec.gov/Archives/edgar/data/796343/000079634319000142/adbeex1035cq219.htm)] [added: Plan*](https://www.sec.gov/Archives/edgar/data/796343/000079634323000055/adbeex107q123.htm)] | | | | | | 10-Q | | | | | | [removed: 6/26/19] [added: 3/29/23] | | | | | | [removed: 10.35C] [added: 10.7] | | | | | | 000-15175 | | | | | | | | |

| 10.5 | | | | | | [Form of Indemnity [removed: Agreement*](http://www.sec.gov/Archives/edgar/data/796343/000079634309000026/ex10_12.htm)] [added: Agreement*](https://www.sec.gov/Archives/edgar/data/796343/000079634324000006/adbeex105fy23.htm)] | | | | | | [removed: 10-Q] | | | | | | [removed: 6/26/09] | | | | | | [removed: 10.12] | | | | | | [removed: 000-15175] | | | | | | [added: X] | | |

| 10.8 | | | | | | [Adobe [removed: Inc. 2020 Executive] [added: Inc.](https://www.sec.gov/Archives/edgar/data/796343/000079634323000252/adbeex101q423.htm) [2023](https://www.sec.gov/Archives/edgar/data/796343/000079634323000252/adbeex101q423.htm) [Executive] Severance Plan in the Event of a Change of [removed: Control*](http://www.sec.gov/Archives/edgar/data/796343/000079634320000248/adbeex101q420.htm)] [added: Control*](https://www.sec.gov/Archives/edgar/data/796343/000079634323000252/adbeex101q423.htm)] | | | | | | 8-K | | | | | | [removed: 12/10/20] [added: 12/13/23] | | | | | | 10.1 | | | | | | 000-15175 | | | | | | | | |

| 10.9 | | | | | | [removed: [2022] [added: [2023] Executive Annual Incentive [removed: Plan*](https://www.sec.gov/Archives/edgar/data/796343/000079634322000056/adbeex1048-k12722.htm)] [added: P](https://www.sec.gov/Archives/edgar/data/796343/000079634323000011/adbe8-kex10512623.htm)[lan](https://www.sec.gov/Archives/edgar/data/796343/000079634323000011/adbe8-kex10512623.htm)[*](https://www.sec.gov/Archives/edgar/data/796343/000079634323000011/adbe8-kex10512623.htm)] | | | | | | 8-K | | | | | | [removed: 1/27/22] [added: 1/26/23] | | | | | | [removed: 10.4] [added: 10.5] | | | | | | 000-15175 | | | | | | | | |

| 10.10 | | | | | | [removed: [Description of 2021] [added: [2023] and [removed: 2022 Director Compensation*](http://www.sec.gov/Archives/edgar/data/796343/000079634321000004/adbeex1012fy20.htm)] [added: 2024](https://www.sec.gov/Archives/edgar/data/796343/000079634323000007/adbeex1011fy22.htm) [Non-Employee](https://www.sec.gov/Archives/edgar/data/796343/000079634323000007/adbeex1011fy22.htm) [Director Compensation](https://www.sec.gov/Archives/edgar/data/796343/000079634323000007/adbeex1011fy22.htm) [Policy](https://www.sec.gov/Archives/edgar/data/796343/000079634323000007/adbeex1011fy22.htm)[*](https://www.sec.gov/Archives/edgar/data/796343/000079634323000007/adbeex1011fy22.htm)] | | | | | | 10-K | | | | | | [removed: 1/15/21] [added: 1/17/23] | | | | | | [removed: 10.12] [added: 10.11] | | | | | | 000-15175 | | | | | | | | |