Las Vegas: On Tuesday, Shantanu Narayen, the chief executive of California-based tech firm Adobe, led the company’s two-hour-long pitch to convince businesses and analysts that in the race among Big Tech firms to sell their innovations in artificial intelligence (AI), it warrants a seat at the top. While a new full-stack agentic AI platform would see Adobe rival the likes of Salesforce, its key executives are clear about one thing: selling AI to businesses still won’t be an easy task.
In the long run, Adobe wants to become the one-stop software seller to businesses for all purposes—including letting them access third-party foundational AI models such as Google’s Gemini for reasoning tasks, and Runway’s Gen-3 and beyond for generative videography tasks.
Wall Street, however, did not react kindly to Adobe’s announcements. On Tuesday, after opening at $395.96 per share on the Nasdaq exchange, Adobe’s shares fell 2.6% after the announcements at one point, but recovered mildly to close at $391.37 per share.
Adobe is not the only tech firm facing scepticism on AI offerings. On 26 February, Amazon unveiled Alexa ‘Plus’—a generative AI experience with the company’s Echo range of smart speakers—that the tech firm is looking to monetize by making it available only to subscribers. The catch: if users buy a new Echo device with Alexa Plus enabled, there will be no option to opt-out of sending various samples of recorded voice inputs to Amazon, all for ‘improving’ its AI offerings.
Much like Adobe, Amazon’s AI pitch was largely ignored by investors. Since its AI unveiling last month, Amazon’s share price on Nasdaq has declined by more than 10% to $192.82 as of Tuesday’s closing bell.
Uncertain returns
The scepticism may be coming largely from the uncertain returns on investment from AI. For instance, Adobe’s numbers don’t quite show a lot of excitement about the uptake of its deepest enterprise play so far.
“We’ve already generated $125 million in our first quarter of this fiscal from pure-play AI subscriptions and sales and, by the end of this fiscal, we expect the AI revenue to double to $250 million,” Eliot ‘Ely’ Greenfield, global chief technical officer of Adobe’s digital media business, told Mint.
The numbers pale when taken in the larger context: in its first quarter of reporting between December 2024 and February 2025, Adobe reported net revenue of $5.71 billion. AI, thus, accounted for a meagre 2.2% of its overall revenue.
Analysts Mint spoke with said Adobe’s predicament is a blueprint for all Big Tech firms—while generative AI is transformative, its business impact is yet to translate into reality.
The tech leaders, in fact, are accepting that there’s a challenge. “Innovating to build AI without using third-party, open-source datasets is like building with our handcuffs on,” Greenfield said. “It definitely does restrict the extent to which the performance of our AI models could have improved so far, as well as the diversity and quality of results that it could have produced today.”
He added that Adobe is still doing it today to ensure that more businesses realize there are “tangible returns in terms of saved manpower hours, more window for creativity and better targeted marketing by using our AI agents”.
In the long run, Greenfield expects customer billing from Adobe’s generative AI offering to pick up pace. “It’s not going to be instantaneous, but to make sure that it is a smooth upward climb, we’re bundling together support for third-party AI models as well to give customers as much of a choice as we can—all the while offering legal indemnification from AI lawsuits when Adobe’s own models are used,” he said.
The copyright conundrum
The slow pace of growth, analysts said, is a clear sign that without infringements and pitfalls, Big Tech may struggle to sell its AI innovation to clients. “Adobe has gone the safe way and played it conservatively in its generative AI push—and its strategy is yet to be proven. It has so far failed to offer an exciting AI revenue roadmap to Wall Street—Tuesday’s event is all about trying to change that perception,” said Kashyap Kompella, AI analyst and founder of tech consultancy, RPA2AI.
To be sure, both OpenAI and Google are embroiled in copyright infringement lawsuits, where parties including The New York Times Company Limited are pushing charges, claiming that the tech firms used copyrighted material to train commercial AI models. The two tech majors—one the face of generative AI and other the founding sponsor—are lobbying the US government to qualify the use of any public information to train AI models as “fair usage”. The US government, on 25 February, opened filings for public comments—and much of AI’s commercial success hinges upon this verdict.
“The uptake of AI is definitely there in marketing initiatives, but for the most part, many marketers are conservative about the uptake of generative AI purely from the copyright infringement perspective,” Billy Seabrook, global chief design officer at tech integrator IBM Consulting, told Mint. “While Adobe’s Firefly model does help in generating copyright-free video and creative illustration content, its effectiveness in performance is likely restricted to being background fillers. Others such as Midjourney and Google’s Imagen are superior, but cannot be taken up by commercial content creators.”
Others, too, are convinced that for now, Big Tech’s biggest challenge is their own pitfall—that of failing to convince businesses in selling AI without lawsuits.
“Eventually, all tech firms will start pushing harder. Each company has spent billions of dollars in AI research and development, so none will let go of generative AI so easily. But, the challenges will remain at least until there is regulatory clarity, or the models become good enough with self-contained re-training upon a finite dataset,” said Jayanth Kolla, co-founder and partner of AI and technology consulting firm, Convergence Catalyst.
“The idea is simple—eventually, all layers of enterprise automation will be bundled into tech platforms that will sell generative AI integrators to vendors. But, until policies are tightened and lawsuits get a specific direction and precedent at least in some leading geography, AI sales will be slow—and Big Tech’s returns on their generative AI bets will keep getting pushed into the future. It’s happening right now—and it is affecting not just Big Tech, but India’s largest tech outsourcing firms as their AI revenue should have already become a sizeable segment to report,” Kolla added.
The writer is in Las Vegas, US, on Adobe’s invitation.
