The end of stock photos? Shutterstock and Adobe's future amid the AI boom

Whether it is a book cover, a product label, or an image in a fitness app, chances are the photo came from a stock marketplace such as Shutterstock or Depositphotos.

For years, the business of licensing stock images followed a proven model: photographers uploaded pictures, while companies of all sizes purchased them for marketing and advertising at lower cost than commissioning shoots or keeping staff photographers. Some players in this market achieved valuations in the hundreds of millions of dollars.

Now, the rise of AI-powered image generators threatens to upend the balance. Oninvest looks at how stock-photo platforms operate, whether they remain an attractive investment, and how generative AI may reshape the industry.

By 2022, affordable and fast AI tools such as Midjourney gave companies the ability to generate custom images from text prompts, offering an alternative to traditional stock libraries. As a result, demand for marketplaces began to soften.

Stock-photo executives argue that concerns are exaggerated. Consumers and marketers remain wary of AI-generated images, preferring authentic photos, writes the Wall Street Journal.

Real photos of real things are still in demand, Shutterstock CEO Paul Hennessy said on a February 2024 earnings call. “We are not seeing our customers at any level of scale with a desire to buy, purchase, and utilize AI-generated images.”

Rebecca Swift, Getty Images’ global head of creative, added that AI models still depend on a constant flow of real-world photos to stay relevant, particularly for new technologies and current events.

While buyers may not be rushing to AI art, investors are skeptical about the sector’s outlook. Since the start of 2025, Shutterstock’s shares have fallen 30%, for a 40% retreat over the past 12 months. Subscriber numbers are also down: at the end of 2024, Shutterstock reported 459,000 subscribers, down 13% from 2023 and 22% from 2022.

Getty Images has faced similar pressure, with its stock losing 7% since January and 40% over the past year.

Even large-cap Adobe, which earns revenue from both stock images and its creative software suite, has been hit. Its shares are down 18% year to date and nearly 50% over the past 12 months.

To adapt, stock-photo firms are pursuing new strategies and AI tools. Getty Images launched an AI image generator in 2023 using its vast photo library in partnership with Nvidia. Last summer, it partnered with Picsart on Model-II, a “responsible, commercially safe” AI generator.

In January 2025, Getty Images and Shutterstock announced a merger that would create one of the largest providers of licensed visual content in the U.S. The deal comes, Bloomberg writes, as AI upends the content-creation market and cell phone cameras dilute the value of stock photos. Following the announcement of the deal, Shutterstock jumped almost 30% in a day, and Getty 50%.

The combined company is valued at about $3.7 billion, including Getty’s $1.4 billion debt. The management expects $150 million to $200 million in annual cost savings within three years and higher earnings and cash flow starting in year two.

However, at the end of August, the UK’s Competition and Markets Authority opened a probe to determine whether the merger would reduce competition. A decision is expected by October 20.

Meanwhile, Shutterstock has rolled out its own generative tool, Shutterstock.AI, built on a mix of internal models and external partners’ solutions. The company reported $104 million in annual AI licensing revenue in 2023, with the CEO projecting up to $250 million by 2027. It is also expanding into AI-powered video and 3D content.

Shutterstock reported record second-quarter revenue, up 21% year over year and 8% above analyst expectations. EBITDA rose 32% year over year, beating forecasts by 23%, Investing.com points out. Still, Citizens JMP kept its “neutral” rating on the stock.

Getty Images posted second-quarter revenue of $234.9 million, up 2.5% from a year earlier and in line with analyst forecasts. But the bottom line swung to a $35.1 million net loss versus a $3.85 million profit a year ago.

Adobe has been embedding AI across its creative suite since 2023, when it introduced generative AI for images and text effects. Photoshop, and other tools, integrated Firefly, its proprietary model, by late 2024. 

Adoption has been broad: 99% of Fortune 100 companies now use Adobe’s AI features, with clients including Coca-Cola, dentsu, Estée Lauder, Henkel, and IBM, the company says.

For the third quarter of 2025, Adobe reported revenue of $5.99 billion, up 11% year over year and above the consensus of $5.92 billion, according to FactSet. Earnings came in at $5.31 per share, beating the $5.18 per share forecast. Annual recurring subscription revenue (ARR) from Adobe’s digital media segment rose 11.7% to $18.59 billion, also topping expectations. The management said the key to Adobe’s AI success lies in Firefly’s application, as well as in a growing selection of third party models, such as Gemini and GPT Image 1.

Despite these initiatives, analysts remain cautious. In August, BofA listed Shutterstock among 26 companies at high risk from AI disruption. It warned that generative AI could replace core services with faster, cheaper alternatives.

On September 24, Morgan Stanley downgraded Adobe from “overweight” to “equal weight,” and cut its target price from $520 per share to $450 per share. The bank cited risks linked to Adobe’s heavy investment in AI.

Earlier, Melius downgraded Adobe to “sell," warning of heightened competition from both tech giants and new rivals.

There is concern that the effects of this shock, once expected only years in the future, could arrive much sooner, creating significant uncertainty for the company’s prospects, the Journal noted.

“Our checks and a dose of common sense tells us that customers – especially new and young ones – won't want to pay for an all-you-can-eat Creative Suite buffet if these AI-first tools are available,” wrote Melius analyst Ben Reitzes. He pointed to companies like Google and OpenAI that offer image-generation and video-editing tools using AI.

The AI translation of this story was reviewed by a human editor.