Design software company Figma delivered a stronger-than-expected fourth quarter, though a 20% after-hours pop on Wednesday (Thursday AEDT) has a lot of ground to make up against a punishing post-IPO slide.
Revenue came in at US$303.8 million for Q4, up 40% year-on-year and clear of Wall Street's $293.15 million consensus estimate.
Figma has surrendered around 80% of its stock value since listing in mid-2025, trading near $23 a share as a sector-wide SaaS correction has flattened most names in the space.
Full year and guidance
Full-year 2025 revenue landed at $1.056 billion, up 41% year-on-year, with international revenue outpacing the headline at 45% growth.
This year, management guided for revenue of US$1.366 billion to US$1.374 billion - roughly 30% growth at the midpoint and well above the $1.29 billion LSEG consensus.
Q1 guidance came in at $315 million to $317 million, pointing to 38% growth continuing into the new year.
Margin shrink
Adjusted free cash flow margin deteriorated steadily across the year - from 41% in Q1 to 13% by Q4, with gross margin retreating from roughly 92% to 86% as the cost of running AI inference at scale accumulated.
The Q4 cash position was also dented by a one-time US$25 million IP transfer tax tied to Figma's acquisition of AI imaging startup Weavy, since rebranded Figma Weave.
Management flagged that gross margins have stabilised over the past two quarters, though stabilisation at 86% is still a meaningful step down from where the business was operating twelve months ago.
On a GAAP basis, Figma recorded a net loss of $226.6 million for the quarter, or 44 cents per share - a considerable reversal from the $33.1 million profit posted in Q4 2024.
AI as the growth lever
CEO Dylan Field leaned into the AI narrative during the analyst call, and there's at least some substance to it.
By the end of Q4, 80% of Figma Make's weekly active users on full seats were also using Figma Design, suggesting cross-platform adoption is running ahead of what pure trial numbers might indicate.
From March, Figma will enforce monthly AI credit limits and introduce usage-based pricing - a monetisation shift that could lift revenue per user or create enterprise friction, depending on how procurement teams absorb it.
"If you look at software, not only is it not going away - there's going to be way more of it than ever before," Field told analysts, though he conceded the competitive landscape is "potentially increasingly" crowded.
