WARNER BROS BOUTA MERGE IS ADOBE EVER GONNA SURGE
- Mr. Bullish
- Sep 12
- 2 min read
📈 1. Adobe (ADBE) – AI-Boosted Earnings and Raised Guidance
What Happened
Adobe reported Q3 FY2025 results: revenue of $5.99 billion (≈ +11% YoY) and non-GAAP EPS of $5.31/share, beating estimates.
Remaining Performance Obligations (RPO) were $20.44B, about +13% from a year ago.
Digital Media revenue was $4.46B (+12% YoY), ARR (Annual Recurring Revenue) in Digital Media up ~11.7%. Digital Experience (subscriptions etc.) also rose.
They raised full-year guidance: expecting FY2025 revenues of $23.65-23.70B and EPS of $20.80-20.85 non-GAAP. Q4 guidance also lifted.
What’s Good / What’s Risky
👍 Positives:
The AI tailwind: Firefly, Acrobat AI Assistant, etc., are driving growth. Companies are adopting.
Strong recurring revenue model (subscriptions) gives more predictability.
The guidance raise shows management confidence.
⚠ Risks / concerns:
Adobe’s stock is still down ~20-25% year to date, meaning investors might be expecting more or fearing competitive threats (OpenAI, Canva, maybe others).
AI competition is heating up. The cost to keep innovating / scaling matters.
Macro headwinds: inflation, potential rate hikes or slower economic growth could affect enterprise/spend budgets.
Stock Reaction
Stock rose modestly (~3-4%) after hours on the earnings + guided up news.
But overall performance still weighed down by investor caution over whether AI monetization can sustain.
🎬 2. Warner Bros Discovery (WBD) – Surge From Merger Rumors
What Triggered the Move
Reports (Wall Street Journal + others) say Paramount Skydance (led by David Ellison, supported by Larry Ellison family) is preparing a majority cash bid for Warner Bros Discovery.
The bid would include acquiring WBD’s studios, streaming assets, cable networks (HBO, CNN, etc.), etc.
Stock Moves
WBD shares surged ~29-37% in a single trading day on the takeover rumors.
Also hit a multi-year high on the strength of the merger speculation.
What’s Good / What’s Risky
👍 Upside:
If a bid goes through, shareholders stand to get a premium.
Strategic value: combining studios/streaming/cable may yield synergies, cost savings, more scale in streaming wars.
Media consolidation is a theme, so being a target in this climate can lift valuation purely on expectation.
⚠ Downsides:
No formal offer yet — rumors can lead to volatility.
Regulatory / antitrust risk: large media mergers often face scrutiny.
WBD has a lot of debt. Its balance sheet could make deals complex or expensive.
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