Adobe (ADBE) shares are falling in Thursday's extended-hours trading despite topping fiscal first-quarter earnings estimates, posting $5.18 billion in revenue and gains of $4.48 per share. The software giant's fiscal second-quarter outlook on revenue and earnings ultimately fell short of Wall Street expectations. Adobe also announced a $25 billion share buyback program. Wolfe Research Managing Director and Head of Software Research Alex Zukin joins Yahoo Finance on Adobe's outlook riding the winds of AI adoption and integration into editing software. "I think it will be really important for them [CEO Shantanu Narayen] to come out and remind folks that Adobe's strength is around the editing side and all of these wonderful, new pieces of content — video or image — that are getting generated now for professional, commercial-grade distribution, you're still going to need to edit them," Zukin says, adding. "This doesn't change in any way my opinion on the competition with the foundation models... or diffusion models themselves..." For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live. Editor's note: This article was written by Luke Carberry Mogan.

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