Why Figma's Stock Plunge Doesn't Match Its Real Business

The Disconnect

Figma went public at $143 in July and now trades below $39. Sounds like a disaster, right? Not so fast. The market might be confusing short-term noise with long-term fundamentals.

The Business Is Firing on All Cylinders

Let’s start with the real numbers:

• 2024 revenue: $749M (up 48% YoY)
• 2025 projected revenue: $1.04B (40% growth expected)

These aren’t garage startup numbers. For context, Adobe once valued Figma at $20B back in 2022. Today’s market cap? Around $18.7B. So you’re buying at a discount to what one of tech’s giants was willing to pay.

The kicker? AI isn’t killing Figma—it’s supercharging it. Their “Figma Make” tool lets users convert ideas into finished designs using AI assistance. They’ve even partnered with ChatGPT to auto-generate diagrams. This isn’t disruption; it’s integration.

Why Q3 Earnings Spooked Everyone (Spoiler: They Shouldn’t Have)

The company reported a $1.1B net loss on $274M quarterly revenue. Wall Street freaked out. But here’s what actually happened: $975.7M of that was one-time stock-based compensation expenses—a non-cash accounting item from their IPO.

Strip that out, and Figma posted adjusted EPS of $0.10 vs. expected $0.05. They beat. But investors saw the headline loss and panic-sold.

The Real Risk: Profitability Timeline

Figma trades at ~100x forward P/E, which is steep. The company isn’t consistently profitable yet—Q2 showed barely $1M in shareholder profit. That’s the legitimate concern, not the growth story.

Is it a bargain or a value trap? That depends on whether you believe a 40% revenue growth rate with improving unit economics eventually leads to sustainable profitability. For a design collaboration platform with strong network effects and AI tailwinds, the bull case is real.

The Bottom Line

Figma’s stock got punished because tech valuations are under fire and earnings confusion spoked investors. But the business fundamentals haven’t deteriorated—the market just reset expectations faster than the company can deliver on them.

At current levels, it’s either a screaming buy for patient capital or a value trap for those betting on profitability never materializing. Either way, it’s no longer a “meme IPO.”