Adobe ends an 18-year era as AI pressure mounts

Adobe is undergoing a major leadership transition 18 years after Shantanu Narayen took the helm of the software company. Anil Chakravarthy will become president and CEO on December 1, succeeding Narayen, who will transition to executive chair. Wall Street's reaction to the announcement suggested the magnitude of the challenges ahead.

Adobe shares dropped nearly 7% after the news, and the stock has fallen 18% in 2026. The company is grappling with the impact of artificial intelligence on its core business of creative software. Chakravarthy, who joined Adobe in 2020, will be tasked with transforming Adobe's AI capabilities into growth opportunities. Adobe is working on generative AI technology like Firefly, but the company lacks AI expertise and faces competition from firms like Canva and Figma.

The impact of generative AI on the economics of creative software is uncertain, and investors are waiting to see if Adobe can adapt to this disruption. The leadership change comes as Adobe prepares to report earnings, providing investors with their first glimpse of the new CEO's strategy and the effectiveness of its AI initiatives.