Enterprise Value to FCFF (EV/FCFF)

Free Cash Flow to The Firm (FCFF)
Interest Paid, Net of Tax
EV to FCFF Ratio, Current
EV to FCFF Ratio, Historical

Free Cash Flow to The Firm (FCFF)

Adobe Inc., FCFF calculation

US$ in millions

12 months ended:	Dec 1, 2023	Dec 2, 2022	Dec 3, 2021	Nov 27, 2020	Nov 29, 2019	Nov 30, 2018
Net income	5,428)	4,756)	4,822)	5,260)	2,951)	2,591)
Net noncash charges	2,229)	2,746)	2,116)	281)	1,493)	495)
Changes in operating assets and liabilities, net of acquired assets and assumed liabilities	(355)	336)	292)	186)	(23)	943)
Net cash provided by operating activities	7,302)	7,838)	7,230)	5,727)	4,422)	4,029)
Cash paid for interest, net of tax¹	85)	82)	85)	70)	140)	75)
Purchases of property and equipment	(360)	(442)	(348)	(419)	(394)	(267)
Free cash flow to the firm (FCFF)	7,027)	7,478)	6,967)	5,378)	4,167)	3,838)

Based on: 10-K (reporting date: 2023-12-01), 10-K (reporting date: 2022-12-02), 10-K (reporting date: 2021-12-03), 10-K (reporting date: 2020-11-27), 10-K (reporting date: 2019-11-29), 10-K (reporting date: 2018-11-30).

¹ See details »

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Item	Description	The company
FCFF	Free cash flow to the firm is the cash flow available to the Adobe Inc. suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made.	Adobe Inc. FCFF increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.

Interest Paid, Net of Tax

Adobe Inc., interest paid, net of tax calculation

US$ in millions

12 months ended:	Dec 1, 2023	Dec 2, 2022	Dec 3, 2021	Nov 27, 2020	Nov 29, 2019	Nov 30, 2018
Effective Income Tax Rate (EITR)
EITR¹	20.16%	20.84%	15.48%	21.00%	7.90%	7.27%
Interest Paid, Net of Tax
Cash paid for interest, before tax	106)	103)	100)	88)	152)	81)
Less: Cash paid for interest, tax²	21)	21)	15)	18)	12)	6)
Cash paid for interest, net of tax	85)	82)	85)	70)	140)	75)

¹ See details »

² 2023 Calculation
Cash paid for interest, tax = Cash paid for interest × EITR
= 106 × 20.16% = 21

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Enterprise Value to FCFF Ratio, Current

Adobe Inc., current EV/FCFF calculation, comparison to benchmarks

Selected Financial Data (US$ in millions)
Enterprise value (EV)	215,672)
Free cash flow to the firm (FCFF)	7,027)
Valuation Ratio
EV/FCFF	30.69
Benchmarks
EV/FCFF, Competitors¹
Accenture PLC	25.47
Autodesk Inc.	50.67
Cadence Design Systems Inc.	65.01
CrowdStrike Holdings Inc.	87.91
International Business Machines Corp.	17.40
Intuit Inc.	38.39
Microsoft Corp.	48.45
Oracle Corp.	40.18
Palo Alto Networks Inc.	40.68
Salesforce Inc.	31.68
ServiceNow Inc.	76.17
Synopsys Inc.	53.89
EV/FCFF, Sector
Software & Services	45.09
EV/FCFF, Industry
Information Technology	52.67

Based on: 10-K (reporting date: 2023-12-01).

¹ Click competitor name to see calculations.

If the company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if the company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.

Enterprise Value to FCFF Ratio, Historical

Adobe Inc., historical EV/FCFF calculation, comparison to benchmarks

	Dec 1, 2023	Dec 2, 2022	Dec 3, 2021	Nov 27, 2020	Nov 29, 2019	Nov 30, 2018
Selected Financial Data (US$ in millions)
Enterprise value (EV)¹	265,229)	155,690)	234,133)	217,408)	168,707)	120,364)
Free cash flow to the firm (FCFF)²	7,027)	7,478)	6,967)	5,378)	4,167)	3,838)
Valuation Ratio
EV/FCFF³	37.75	20.82	33.61	40.43	40.48	31.36
Benchmarks
EV/FCFF, Competitors⁴
Accenture PLC	20.26	16.99	24.76	17.90	18.49	—
Autodesk Inc.	20.48	27.63	41.13	23.38	98.38	—
Cadence Design Systems Inc.	63.83	44.54	35.05	44.13	29.35	—
CrowdStrike Holdings Inc.	38.65	96.35	141.44	807.14	—	—
International Business Machines Corp.	15.27	16.47	13.10	9.35	12.86	—
Intuit Inc.	31.28	32.85	48.64	37.90	33.30	—
Microsoft Corp.	41.75	32.31	38.37	33.99	26.37	—
Oracle Corp.	35.83	31.60	16.36	14.99	14.03	—
Palo Alto Networks Inc.	28.15	29.29	32.74	26.50	20.44	—
Salesforce Inc.	28.41	35.97	44.91	39.63	41.21	—
ServiceNow Inc.	56.49	40.86	60.13	83.74	67.96	—
Synopsys Inc.	55.87	30.82	38.59	42.88	33.32	37.07
EV/FCFF, Sector
Software & Services	35.33	29.55	32.31	27.29	23.61	—
EV/FCFF, Industry
Information Technology	34.32	27.25	28.19	24.28	19.87	—

¹ See details »

² See details »

³ 2023 Calculation
EV/FCFF = EV ÷ FCFF
= 265,229 ÷ 7,027 = 37.75

⁴ Click competitor name to see calculations.

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Valuation ratio	Description	The company
EV/FCFF	Enterprise value to free cash flow to the firm is whole company valuation indicator.	Adobe Inc. EV/FCFF ratio decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Adobe Inc. (NASDAQ:ADBE)

Enterprise Value to FCFF (EV/FCFF)

Free Cash Flow to The Firm (FCFF)

Interest Paid, Net of Tax

Enterprise Value to FCFF Ratio, Current

Enterprise Value to FCFF Ratio, Historical