Adobe Inc. stock research
FY2025 Q3
Adobe (ADBE) Gross Margin — Quarter Ended Aug 29, 2025
Revenue and gross profit increased both sequentially and year-over-year. Gross margin improved slightly from the prior quarter but decreased compared to the same quarter last year.
Gross margin takeaway
Quarter ended Aug 29, 2025 · FY2025 Q3
Revenue and gross profit increased both sequentially and year-over-year. Gross margin improved slightly from the prior quarter but decreased compared to the same quarter last year.
- The sequential improvement in gross margin was driven by revenue growth outpacing cost of revenue growth. The year-over-year decline reflects a different dynamic where cost of revenue grew more rapidly.
- Compared to the immediately preceding quarter, gross margin improved. Compared to the same quarter one year earlier, gross margin weakened.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
89.3%
Gross profit
$5.3B
Revenue
$6.0B
Cost of revenue
$642.0M
Quarter-over-quarter change
+0.1 pts
Year-over-year change
-0.5 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Nov 29, 2024 | $5.6B | $5.0B | $616.0M | 89.0% |
| Feb 28, 2025 | $5.7B | $5.1B | $622.0M | 89.1% |
| May 30, 2025 | $5.9B | $5.2B | $638.0M | 89.1% |
| Aug 29, 2025 | $6.0B | $5.3B | $642.0M | 89.3% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
May 30, 2025
+0.1 pts
Year-over-year change
Aug 30, 2024
-0.5 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The sequential improvement in gross margin was driven by revenue growth outpacing cost of revenue growth. The year-over-year decline reflects a different dynamic where cost of revenue grew more rapidly.
Compared to the immediately preceding quarter, gross margin improved. Compared to the same quarter one year earlier, gross margin weakened.
Monitor the trend in cost of revenue growth relative to revenue growth.