Adobe (ADBE), Salesforce (CRM), and The Trade Desk (TTD) stocks fell to new 52-week lows on Thursday as investors pulled money from traditional software businesses and redirected capital toward companies building artificial intelligence infrastructure. Investors questioned whether generative AI will strengthen the competitive positions of legacy software companies or weaken their pricing power by making existing products easier to replace. Adobe stock tumbled over 6%, while Salesforce and The Trade Desk stocks fell over 2% each.
Adobe Reports Q1 Revenue Growth Amid Leadership Transition
Adobe came under selling pressure on Thursday, pushing the stock to a seven-year low of $218.1. The company reported quarterly revenue of $6.62 billion, representing a 13% increase from a year earlier. Adobe posted adjusted earnings per share (EPS) of $5.95 and raised its full-year forecast. Both revenue and EPS beat Street estimates of $6.45 billion and $5.81, according to Fiscal AI data.
CFO Dan Durn planned departure added uncertainty during the period. In March, Adobe CEO Shantanu Narayen said he plans to step down once a successor is chosen. On Stocktwits, retail sentiment around the stock improved to 'extremely bullish' from 'bullish' territory the previous day.
Salesforce Announces Workforce Reductions and m3ter Acquisition
Salesforce shares fell to a three-year low of $163.31 on Thursday as the company undertook restructuring including layoffs across several business units. According to a Business Insider report published Tuesday, the job cuts affected employees working on the company's Agentforce AI platform, MuleSoft software, and Marketing Cloud products.
Salesforce acquired billing software provider m3ter on Monday, a move viewed as part of an effort to adapt its pricing strategy for an AI-driven market. Retail sentiment around the stock remained in 'bearish' territory.
The Trade Desk Issues Q2 Revenue Outlook Below Analyst Expectations
Shares of The Trade Desk (TTD) fell to a six-year low of $18.37 on Thursday, extending a decline that erased nearly 74% of the digital advertising company's market value over the past year. Fiscal Q1 revenue expansion moderated into the low double digits, while the company's Q2 revenue outlook of $750 million fell short of analyst expectations of $770.41 million, according to Fiscal AI data.
Over the past year, the company experienced leadership turnover including the departures of marketing chief Ian Colley, revenue chief Anders Mortensen, and at least three CFOs. Retail sentiment around the stock remained in 'bullish' territory.
So far this year, TTD stock declined 50%, while ADBE and CRM stocks fell over 37% each.
FAQ
What caused Adobe, Salesforce, and The Trade Desk stocks to hit 52-week lows on Thursday?
Investors pulled money from traditional software businesses and redirected capital toward companies building artificial intelligence infrastructure on Thursday. Adobe fell to a seven-year low of $218.1, Salesforce dropped to a three-year low of $163.31, and The Trade Desk declined to a six-year low of $18.37.
What financial results did Adobe report in Q1?
Adobe reported quarterly revenue of $6.62 billion, representing a 13% increase from a year earlier. The company posted adjusted earnings per share (EPS) of $5.95. Both revenue and EPS beat Street estimates of $6.45 billion and $5.81, according to Fiscal AI data.
What leadership changes occurred at Adobe and The Trade Desk?
Adobe CFO Dan Durn planned departure, and CEO Shantanu Narayen said in March he plans to step down once a successor is chosen. The Trade Desk experienced departures of marketing chief Ian Colley, revenue chief Anders Mortensen, and at least three CFOs over the past year.
