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I am trying to open a file with the format .psd.icloud but It wouldn't open on Photoshop. It says
"Could not complete your request because Photoshop does not recognize this type of file."
Specs for reference:
Change the extension to .psd and try again.
Try the solution from @D Fosse first.
This user had the same (or similar) issue. Finder said .psd and the error message said .psd.icloud. It was solved by dragging the file to their local disk: