Adobe Inc. (NASDAQ:ADBE)

The information presents a fluctuating pattern in market value and market value added over a six-year period. While invested capital demonstrates a generally increasing trend, the market value exhibits significant volatility. Consequently, market value added, calculated as the difference between market value and invested capital, also displays considerable variation.

Market Value

The market value of the company initially increased from US$222,840 million in 2020 to US$238,694 million in 2021, representing a growth of approximately 7.1%. A substantial decline followed in 2022, with the market value decreasing to US$160,181 million. A strong recovery occurred in 2023, bringing the market value to US$272,572 million. However, this was followed by a decrease to US$183,485 million in 2024 and a further decline to US$130,283 million in 2025. This indicates a high degree of market sensitivity and potential volatility in investor sentiment.

Invested Capital

Invested capital shows a consistent upward trend throughout the period, increasing from US$18,837 million in 2020 to US$22,203 million in 2025. The growth is not linear, with smaller increases observed between 2021 and 2022, and 2024 and 2025. However, the overall trajectory suggests a steady commitment to capital deployment.

Market Value Added (MVA)

Market value added mirrors the fluctuations in market value. It rose from US$204,003 million in 2020 to US$217,629 million in 2021, then decreased significantly to US$139,051 million in 2022. A substantial increase was observed in 2023, reaching US$247,602 million, followed by declines to US$158,776 million in 2024 and US$108,080 million in 2025. The MVA demonstrates a strong correlation with the market value, indicating that changes in investor perception have a significant impact on the company’s value creation above its invested capital.

Relationship between Metrics

The largest increases in MVA coincide with periods of market value growth, specifically between 2020-2021 and 2022-2023. Conversely, the most substantial declines in MVA occur during periods of market value contraction, notably between 2021-2022 and 2023-2025. The relatively stable increase in invested capital suggests that changes in MVA are primarily driven by shifts in market valuation rather than significant alterations in the capital base.

In summary, the period examined is characterized by significant market value volatility, which directly impacts market value added. While invested capital demonstrates a consistent, albeit moderate, growth trend, the company’s overall value creation appears highly sensitive to external market forces.

The Market Value Added (MVA) exhibited considerable fluctuation over the observed period. Initially, MVA increased from 2020 to 2021, followed by a substantial decline in 2022, a recovery in 2023, and subsequent decreases in 2024 and 2025. Invested capital demonstrated a generally increasing trend, though at a slower pace, throughout the period, with a slight decrease observed in the most recent year.

MVA Trend

MVA began at US$204,003 million in 2020, rising to US$217,629 million in 2021, representing a growth of approximately 6.6%. A significant decrease was then recorded in 2022, with MVA falling to US$139,051 million. The value rebounded strongly in 2023, reaching US$247,602 million. However, this positive momentum did not persist, as MVA decreased to US$158,776 million in 2024 and further to US$108,080 million in 2025.

Invested Capital Trend

Invested capital showed a consistent upward trend from 2020 to 2024. It increased from US$18,837 million in 2020 to US$24,970 million in 2023, indicating growing capital deployment. In 2025, invested capital experienced a slight reduction, decreasing to US$22,203 million. This suggests a potential shift in capital allocation strategy or a decrease in investment opportunities.

MVA Spread Ratio Trend

The MVA spread ratio, which reflects the relationship between MVA and invested capital, generally decreased over the period. It started at a high of 1,082.99% in 2020, decreasing to 1,033.13% in 2021. A substantial decline was observed in 2022, falling to 658.07%. The ratio partially recovered to 991.60% in 2023, but continued its downward trajectory, reaching 642.58% in 2024 and 486.78% in 2025. This indicates that the market value created per dollar of invested capital is diminishing over time.

The decreasing MVA spread ratio, despite increases in invested capital during certain periods, suggests a potential weakening in the efficiency of capital allocation or a change in market perception regarding the company’s ability to generate value from its investments. The volatility in MVA itself warrants further investigation to understand the underlying drivers of these fluctuations.

The Market Value Added (MVA) exhibited considerable fluctuation over the observed period. Initially increasing from 2020 to 2021, it then experienced a substantial decline in 2022 before recovering in 2023. Subsequent years, 2024 and 2025, demonstrate a continued downward trend in MVA.

Market Value Added (MVA)

The MVA began at US$204,003 million in 2020, rising to US$217,629 million in 2021. A significant decrease followed, with MVA falling to US$139,051 million in 2022. It rebounded to US$247,602 million in 2023, but then decreased to US$158,776 million in 2024 and further to US$108,080 million in 2025. This pattern suggests sensitivity to external factors or internal strategic shifts.

Adjusted Revenue

Adjusted revenue consistently increased throughout the period. Starting at US$13,126 million in 2020, it grew to US$16,904 million in 2021, US$18,142 million in 2022, US$19,945 million in 2023, US$21,814 million in 2024, and reached US$24,540 million in 2025. This indicates a steady expansion of the company’s top line.

MVA Margin

The MVA margin experienced a pronounced decline over the period. It started at a high of 1,554.19% in 2020, decreasing to 1,287.44% in 2021. The largest drop occurred between 2021 and 2022, falling to 766.46%. While there was a partial recovery to 1,241.42% in 2023, the margin continued to decrease in 2024 (727.86%) and 2025 (440.42%). The decreasing MVA margin, despite increasing revenue, suggests that the market is valuing each dollar of revenue less over time, or that the cost of generating that revenue is increasing relative to the value created.

The divergence between the increasing adjusted revenue and the fluctuating, ultimately declining, MVA and MVA margin warrants further investigation. While revenue growth is positive, the diminishing MVA margin indicates a potential disconnect between revenue generation and shareholder value creation. This could be due to factors such as increased competition, rising costs, or changing market expectations.