You've led this business as CEO since
2007. You know what it's like to lead a giant
through a financial instability issue, through a bank crisis.
What do you make of the macro economic environment for Adobe right now?
Well, Caroline, thank you so much for having me on your show.
And as you know, we just announced Q1 results and for us, digital really just
continues to be a massive tailwind because it's reshaping how we live, how
we work, how we're entertained. And Adobe has always really focused on
ensuring that we build a company for the long run.
You're absolutely right. There are business cycles.
But whether it's consumer sentiment or whether it's small and medium business
creation or larger enterprises, while there's perhaps more scrutiny on the
expense, people realize that in order to drive profitable growth.
Technology is one of those areas that you have to continue to invest in.
So maybe we're a little more fortunate because we have more mission critical
solutions and we have a more diverse portfolio as it relates to geographic
exposure. But, you know, the company posted really
strong results. Let's talk about image, this desire to
continue to focus on R and D. You are, of course, today announcing
what indeed the last couple of days that your summit announcing new artificial
intelligence iterations in your product, in particular, Firefly, the family of
generative A.I. Tools.
And boy, the one silver lining, the one area of growth that we keep continuing
to talk about, no matter what the macro environment is, generative A.I.
models, it's in beta. Can you just
give our audience what what this means in terms of text and generating image?
What's the leap? Is this actually as a user of Adobe?
We think it is really a transformational moment, both for the company as well as
for the industry. And Caroline, where we focus on is our
vision is how do we unleash creativity for all?
It's our assertion and hypothesis that everybody has a story to tell.
They would like to tell that story on different media.
I was listening to your show and you were talking about what's happening with
other platforms like Tick Tock, but people fear the blank page or the blank
slate. And so I think generative A.I.
is a great way to have onramp into being able to take your idea.
Describe that in words and then generate an image associated with that.
And, you know, I think people are also really focused on what are the ethical
issues associated with generating, you know, these images.
And I think we've taken a very prudent and correct approach.
So we think it helps people make our products more accessible, more
productive and more fun. How are you talking to those legal
concerns for creators that perhaps they want the images used?
That's part of the reason that we are actually starting with the beta, because
engaging with the community has been a really important aspect of how we
introduce this. We've had of site called Be Hands Behind
says, you know, the most popular site for creative professionals in terms of
how they showcase their content and get inspired.
So, you know, Adobe has had a multi decade history of engaging with our
customers in this particular case. We've a very, very ruthless about
ensuring that the content on which our models were trained are its content that
we have absolute license for. I think other companies have not been as
strict or as diligent about ensuring that the content that they use to train
the models. As we all know, the more data they do
have to trade in the models, the better the models are.
And so our approach has been always to make sure that this is bulletproof in
terms of having rights to it and just engaging with the community.
We've also talked about how as we continue to have our stock service,
which is a very popular image, 3D service, that we will compensate the
people who are participating in that. So it's a thoughtful approach.
It's the beginning of the journey, but most important, it's transparency and
engagement with our community. Antony, you are thoughtful and you think
about ethics and you just mentioned tick tock.
So I just have to go with that for a moment.
What do you make of the business? Well, I think from my perspective, you
know, every few years you have multiple platforms.
And for me, when I think about Dick Darko, I think about the other
platforms. It's really this insatiable appetite
that people have for both consuming and for creating content.
And so, you know, I am not as familiar with all of the issues that all those
are perhaps concerned about. But from my perspective and the role
that Adobe can play, it's like how do we allow people to express themselves?
And I think that insatiable appetite is not going to go away.
Of course, when it comes to authorities analyzing tech businesses like Tick
Tock, there's some authorities eyeing many here in the US, in particular the
DOJ analyzing your tail for figure at the moment.
How in Tegel is the figment deal, your generative A.I.
movement forward? How integral is that deal?
Full stop? Well, you fight to protect it.
Well, from our perspective, the strategic rationale for why we are
excited about FEMA is three things. We believe that we can accelerate
product design, which enables new interactive experiences to be built for
digital medium. The second reason is we think we can
actually extend all of our products to do creative collaboration on the web and
allow more stakeholders to participate, much like we did with our acquisitions
or work front and free mile. And third, I think that there's this new
emerging paradigm where the distinction between collaboration, creativity and
productivity is rapidly diminishing. And everybody who wants to create a
school project or a document wants to engage in it, both using words and text
and images and animation. So strategically, we think that it is a
real extension of what we do. The figure business is an adjacency for
us. I know there have been some questions
about what does this mean for our core business.
As we showed, our core business is extremely strong.
So we're doing this from a position of strength.
We're confident about, you know, our position in this.
It's such an adjacency and the overlap is de minimis to none.
But we will engage with the authorities. Would you ever abandon the deal if you
had to? Well, at this point, you know, given we
are confident about, you know, the deal terms, we will just continue to operate
with the authorities. And, you know, that's what we're focused
on, which is how do we, you know, continue to deliver value to customers
and demonstrate why this is a good thing for the community, for customers.
And another important thing for the economy.
If companies that are being created. The U.S.
has been the hotbed of entrepreneurship. It is really critical that there be
economic outcomes that are appropriate for startups as well.
So at this point, we're really focused on continuing to impress upon the
authorities why this is good.
