Overview
- Morgan Stanley cut Adobe to Underweight with a $240 price target and trimmed Salesforce to Equal-weight with a $185 target on Tuesday, moves that pushed both stocks lower in premarket trading.
- Analyst Adam Wood pointed to a timing gap between heavy AI spending and measurable revenue gains as the core concern for both companies.
- For Adobe Wood flagged the company’s shift to freemium pricing, the ongoing CEO and CFO transitions, and the risk that AI-native tools could erode parts of its creative workflow.
- For Salesforce the bank said products like Agentforce show technical promise but need evidence they will increase annual recurring revenue and offset weakness in legacy units such as Commerce and Tableau.
- The report also cut Workday and initiated coverage of Intuit while naming other software names as preferred picks, a move that could shift investor allocations and raise near-term pressure on management to show concrete ARR and product-integration milestones.