Melius Research downgraded Adobe Inc. to Sell from Hold and lowered its price target to $310, warning that the software maker faces a prolonged period of valuation multiple contraction as generative-AI technology reshapes the industry. The brokerage said checks indicate Adobe is ceding market share, particularly among younger customers who may balk at paying for the company’s broad Creative Suite when AI-first rivals offer narrower, lower-cost tools. Melius argued that value in the software stack is shifting toward infrastructure providers that enable artificial-intelligence workloads. Adobe shares have fallen about 48% since early 2024, underperforming both software peers and the broader market. The downgrade adds to a growing list of brokerages reassessing the stock as competitive and macroeconomic pressures build.