- What is Adobe, and how does Adobe work?
- How does Adobe make money?
- Subscription Revenue
- Product Revenue
- Services And Other Revenue
- Adobe’s Subsidiaries, Acquisitions, and Exits
- Adobe’s profit and revenue
- What is the Adobe business and revenue model?
- Adobe’s funding and valuation
How does Adobe make money? Here is a full, in-depth, breakdown of their three (3) revenue streams and the different products and services they offer, as well as the Adobe business and revenue model, their profit and revenue, and how Adobe works.
What is Adobe, and how does Adobe work?
Adobe is a computer software company that creates applications specializing in graphic design, web design, video editing, animation, visual effects, and more.
Since that time, Adobe is said to now have more than 22 million paying Creative Cloud members using their apps on a monthly basis.
How Adobe works is: Users can choose from over 20+ app products through 19 different subscription plans that Adobe offers. Once a user chooses a plan, they will receive a license key to access the software for as long as they are paying for it. Billing can be paid monthly or annually.
Some of Adobe’s competitors include Canva and other graphic design services.
How does Adobe make money?
Adobe is said to now have more than 22 million Creative Cloud members paying to use their apps. And, according to the company’s about page, these apps have been downloaded more than 449 million times.
So how does Adobe make money off of all those customers?
Below is a breakdown of how much money Adobe makes and its revenue model. Including all revenue streams and how much they charge for their services.
Here are the 3 ways of how Adobe makes money (in 2021):
Adobe has a revenue model that makes money in three (3) ways – subscription revenue, product revenue, and other services.
#1. Subscription Revenue
Adobe makes the majority of its money from the subscription services they offer. In fact, $11.26 billion or 87.5% of Adobe’s total revenue came from subscriptions in 2020.
Adobe has 20+ apps with 19 subscription plans to choose from. All ranging in price between $4.99 to $79.99 per month depending on the type of plan and who they are licensing the software to. (Which can be seen below or by clicking here).
Adobe Subscription Price:
- Individual: $4.99 to $52.99 per month
- Business: $33.99 to $79.99 per month, per licence
- Students & Teachers: $19.99 per month
- Schools & Universities: $14.99 to $34.99 per month, per user
Note: 87.5% of Adobe’s total revenue came from subscriptions in 2020.
#2. Product Revenue
On top of licensing their apps to be used via subscriptions, Adobe also makes money by licensing these apps out in other forms as well. Which brought in an additional $507 million of revenue for Adobe in 2020.
These other forms include licensing the software to be used on the premises of the person and or organization using the software which may be (1) purchased on a permanent basis, as a subscription for a fixed period of time, or (2) based on the usage for certain of Adobe’s OEM and royalty agreements.
#3. Services And Other Revenue
In addition to the subscription and product revenues, Adobe makes the remaining portion of its money from “Services And Other Revenue,” as the company describes it. Which, collectively resulted in $735 million of revenue for Adobe in 2020.
This revenue, according to page 48 of Adobe’s 2020 Form 10-K, is recognized as “fees related to consulting, training, maintenance and support, and [Adobe’s] advertising offerings.”
Adobe’s Subsidiaries, Acquisitions, and Exits
To date, Adobe Inc. has made a total of 57 acquisitions, 26 investments, 7 lead investments, and 7 successful exits.
Adobe’s profit and revenue
In 2020, Adobe reported $12.87 billion in revenue.
Note: Because Adobe Inc. is a publicly traded company, under the Securities Exchange Act of 1934, they must file continuous financial filings with the U.S. Securities and Exchange Commission (SEC). You can find all of Adobe’s publicly released financial reports, including annual reports, through Adobe’s investor section on their website.
What is the Adobe business and revenue model?
Adobe makes money through a few revenue models that they combine within their company, they are:
- Subscription based business model
- Licensing revenue model
- Fee-for-service (FFS) business model
- Mergers & acquisitions (M&A) business model
Adobe’s funding and market cap
According to Adobe’s Crunchbase profile, Adobe has raised $2.5 million over 1 round and has an estimated market cap of $299.266 billion as of September 2021.