Adobe’s decline was mainly due to its disappointing forward guidance. Q2 revenue forecast came in at $5.77–$5.82 billion vs. the consensus of $5.8 billion. Investors were likely spooked as the lower end of the guidance still implies a chance of Adobe missing expectations.

Not only that, but Adobe reported $2.5 billion in positive free cash flow for the quarter, twice last year's $1.2 billion, and 36% more than reported net income. By these metrics, the quarter looked exceptionally strong, and earnings quality at Adobe was very good.