According to CNBC, Figma delivered stronger-than-expected third-quarter results with revenue of $274.2 million beating the $265.2 million consensus estimate. The design software company grew revenue 38% year-over-year while reporting a massive $1.10 billion net loss, up from just $15.6 million in the same quarter last year. CEO Dylan Field revealed that about 30% of customers spending over $100,000 annually are using Figma Make, their generative AI product, on a weekly basis. The company’s adjusted operating margin came in at 12%, well above the 6.5% StreetAccount consensus. Despite the strong performance, Figma’s stock slipped 1% in extended trading following the announcement.
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AI driving growth
Here’s the thing about Figma Make – it’s clearly becoming the company’s growth engine. When nearly a third of your biggest customers are actively using a new product weekly, that’s not just a nice-to-have feature. That’s becoming core to your value proposition. Field basically said as much, calling it a “big driver of new customers in Q3.” The timing couldn’t be better either, given how every software company is racing to prove their AI credentials to investors.
The elephant in the room
But let’s talk about that $1.10 billion loss. That’s not just a bad quarter – that’s catastrophic on paper. The company quickly points to stock-based compensation as the culprit, which does make the adjusted numbers look much healthier. Still, when your net loss balloons from $15.6 million to over a billion dollars in one year, investors have to wonder what’s really going on. Is this sustainable? Are we looking at another case of growth at any cost?
Profitability puzzle
The adjusted operating margin of 12% looks impressive compared to expectations, but it raises questions about the path to actual profitability. Companies can play with adjusted numbers all day, but eventually the market wants to see real profits. Figma’s walking a tightrope here – investing heavily in AI while trying to convince Wall Street they’ve got the financial discipline to turn this into a sustainable business. The stock’s slight dip after hours suggests investors aren’t completely sold yet, despite the strong guidance.
Broader implications
This earnings report feels like a microcosm of the entire software industry right now. Everyone’s chasing AI adoption metrics while hoping investors will overlook messy financials. Figma’s making the bet that if they can get enough customers hooked on their AI tools, the profitability will follow. It’s a risky strategy, but one that could pay off huge if they become the default AI-powered design platform. The next few quarters will tell us whether this is genius positioning or just another tech company burning cash to chase the AI hype cycle. You can read more about their official results in their press release.
