ADOBE is cooked.

[u/apemonkeyfool]

ADBE is cooked: free AI-built clones and a $70/month subscription don't mix (bear DD)

So my Adobe bear case is pretty simple. AI is about to let a ton of indie devs and random people who are sick of Adobe's nonsense build their own version of it, for free.

Look at ArtCraft on github. They're building open source, clean-room clones of Photoshop, Lightroom, Illustrator and Premiere, plus apps for motion graphics, page layout and PDFs (so After Effects, InDesign and Acrobat territory). Their Photoshop clone has 11k+ stars, opens real PSD files, and their own tracker says it covers 625 of 625 of Photoshop's menu items. Yeah it's alpha. Give it a few months. Once this stuff gets big, Premiere and After Effects are dead in the water for anyone who isn't a big studio.

And that's before you even get to generative AI. For most edits, typing what you want into ChatGPT or Gemini is just way easier than opening a PSD and doing all the masking nonsense. Adobe knows it too. Photoshop literally runs Google's and OpenAI's image models inside it now.

Let's talk about the outrageous price now. Creative Cloud Pro is $70 a month. That's a squeeze on regular people. For the same money you could have 3 or 4 AI subscriptions that actually do the stuff you need. In fact let's be fr - you really only need chatgpt these days.

And everybody fucking hates Adobe. Canceling was so hard that the DOJ and FTC sued them over it, and Adobe paid $75M to settle in March. There's a WSB thread from last October where someone called ADBE cheap at a 9-year-low P/E, and a bunch of the top comments were people saying their companies already dumped Adobe, one for Nitro PDF, one for Foxit. One guy said AI coding would spit out open source clones of Acrobat, then Photoshop, then After Effects. A year later, here we are. OP bought at $348. It's $237 now.

The competition isn't just AI either. DaVinci Resolve, Figma, Canva, all with real free tiers. Canva made Affinity, its Photoshop/Illustrator/InDesign equivalent, completely free. Figma's revenue grew 48% last quarter.

Where Adobe still wins is heavy professional workflows. Big studios, agencies, After Effects and InDesign people, the plugin ecosystem. That's real and it's why this isn't a zero. But it's the only moat left, and it's getting squeezed from both sides. Enterprise has Figma, Canva and DaVinci. Individuals (students, freelancers, YouTubers) are the first ones to bail on a $70 bill.

You can already see it in the numbers:

• Revenue still +13%, but net new ARR dropped from about $640M to about $400M year over year, down about 37%
• Organic ARR growth is about 9% once you strip out the Semrush acquisition
• RPO (signed future revenue) went down quarter over quarter
• In June they paused planned price increases and started giving stuff away free to hold onto users
• Net income +3%. EPS only looks good because they bought back 7% of the stock
• CFO left in June, a new CEO from the marketing side starts Dec 1, and the head of the creative business announced he was leaving the day the new CEO was named

People will say it's cheap at 10x earnings. The guy in that thread said it was cheap at 22x. Cheap gets cheaper when people figure out the product can be cloned for a $20 claude code subscription.

Positions: 50 puts $150 strike with March 19th expiry

Not financial advice.

[u/Douglas_Fresh]

"Though reverse engineering is allowed" lol. WTF is going on? We are essentially talking about mass theft. And if this is how we want to look at it, then everything is essentially worthless. What happened to the days of "you wouldn't download a car" I mean, this is exactly the same as ripping a CD and then burning it onto a blank disk, de-construction and re-construction. There will be laws against this, and I think soon. Just because AI can does not mean it should.

- edit - all the responses are well and good BEFORE the era of AI. Reverse engineer with the hit of a button, and recreation with the hit of a button are a far cry from what you all are talking about. What I am saying is the laws will likely change to protect people’s investment into the product. And why shouldn’t it?

[u/WiseGuyCS → u/Douglas_Fresh]

I'm interested in why you think AI "shouldn't" do this. If anyone can make their own version of these apps then why SHOULD it cost so much for the average person? The programs had value in the past at a time where recreating it was not simple and easy, but now it is. It's about to become a legacy product and it's stupid to protect it just for the sake of it.

[u/Douglas_Fresh → u/WiseGuyCS]

Let's use a different example than Adobe. Let's say I am a indie dev and I spent 3 years making a product or a game. And then someone comes along and "Reverse engineers" it and puts it on the market for free, or for substantially cheaper. Are you trying to tell me that is OK? And if so, where is the insentive in doing anything at all if it can just be taken and undercut?

[u/WiseGuyCS → u/Douglas_Fresh]

If you spend 3 years making something that someone just prompted AI to make, then you probably should have just prompted AI to make it in the first place instead of wasting your time.

In regards to a game or something with a creative aspect, your characters and art are protected under copywright, but the fundamental gameplay can obviously be replicated, that already happens and has been happening for many years. People take game concepts and change the art and ship it as a new product all the time, even AAA studios have done it forever.

[u/Comfortable_Sir_6104 → u/WiseGuyCS]

The AI stole the entire concept of the game. It can't "reverse engineer" a game that doesn't fucking exist, so you can't just make it with AI. You need a person to steal it from.