Figma (FIG) entered the market like a kid who’d found the keys to a shiny new car, promising everything and delivering half of it. It’s a software for design and website creation, the kind that lets professionals work together without arguing over who bought the last coffee. It went public last month, and for a moment, the stock ticked upwards like a well-oiled machine. But in the world of stocks, machines break down fast.
Back in 2022, Adobe (NASDAQ: ADBE) made a bid to snap up Figma for a cool $20 billion, looking to add it to their growing empire. The regulators had other ideas, though, and put the kibosh on the deal. Now, Figma’s a free agent, floating on the market like a lone shark in a sea of minnows.
For a while, it seemed like the stock had found its sweet spot. The price opened at $85, and by August 1, it was near $143. Investors were hopping on like it was the last bus out of town. But as the days wore on, it became clear that the hype wasn’t built to last. The stock took a dive, like an elevator plummeting without its cables.
So, what’s really going on here? Is Figma just taking a breather after its sprint, or are investors staring at a ticking time bomb? Let’s take a deeper dive into the picture, and I’ll give you the good and bad in the same breath.
The Bullish Case for Figma
If you’re looking for a reason to back Figma, it’s not hard to find. The software’s got a charm all its own. It offers affordable plans-$16 per month for the full suite of design tools. Compare that to Adobe’s $23 for a single Photoshop subscription, or $70 if you want the whole Creative Cloud. Figma’s got the price advantage. In times like these, when wallets are tighter than a banker’s handshake, that’s worth something.
But there’s more. Figma has a following, a loyal one. Last year, it posted $749 million in revenue, a solid 48% increase from the year before. And in the first quarter of 2025, it racked up $228 million, which is up 46%. The kind of numbers that make a man sit up in his chair.
The company’s got something else going for it-132% dollar retention. That means customers are spending more than they did last year. The kind of thing you can’t fake. Add to that the fact that 95% of Fortune 500 companies use Figma, and you’ve got yourself a software that’s caught on like a drug in a high school hallway.
The Bearish Case for Figma
But for all the charm, Figma’s got problems-big ones. It’s not making a profit. For two straight years, it’s reported losses. Sure, it’s managing to scrape by with a $0.04 EPS in the first quarter, but that puts its annualized EPS at a measly $0.16. At a price tag around $80, that gives it a price-to-earnings ratio that would make your grandmother faint-almost 500. The market’s willing to pay for potential, but at these prices, they’re practically handing out their lunch money.
And then there’s the matter of its operating expenses. They’re sky-high, chewing up around 75% of its revenue. That’s not a good look, not when you’re trying to grow a business and turn a profit. Without a serious change in cost structure, Figma’s future earnings are going to stay flatter than a pancake after a truck drives over it.
On top of that, you’ve got the threat of AI. It’s like a dark cloud hanging over the design world, promising to replace Figma’s bread and butter with tools that could do the job faster, better, and cheaper. In a world of algorithms, a human touch might just not be enough. As growth slows and competition increases, the stock might drop faster than a bad habit.
Should You Buy Figma Stock Today?
Here’s the deal: Figma’s not the next big thing, at least not yet. Sure, it’s doing well, but the numbers are still small. You can’t expect a company with high operating costs and no profits to keep up the pace indefinitely. The design world’s evolving, and Figma’s caught in the middle of it, a little too dependent on the old ways of doing things. Unless the stock takes a serious dip, I’d steer clear.
In this game, you don’t bet on a horse unless you’re sure it’s going to finish the race. And Figma’s still showing signs of stumbling. Hold off. It’s not time to cash in yet. 🧐
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2025-08-12 01:48