Figma Just Grew Revenue 43%. Its Stock Fell 7% Anyway.

Figma just beat Wall Street's expectations. Its stock dropped anyway.

The design software company reported third-quarter revenue of $391.4 million on November 4, up 43% from a year earlier and $16.4 million above the top of its own forecast. Analysts polled by LSEG expected $375.8 million. Shares fell 7% in extended trading, CNBC reported, and were already down about 41% this year.

Figma also raised its full-year revenue forecast by $33 million, to between $1.497 billion and $1.499 billion. But it expects growth to slow to about 33% in the fourth quarter, above the 28% analysts predicted but well below the 43% it just posted.

Neither Figma's release nor CNBC said what caused the drop.

More AI credits for the same price

Figma's AI tools run on credits, which are spent each time someone runs one of those features. In August, Figma changed how many credits its paying customers get.

Starting August 25, paid add-ons included twice as many credits on the Professional plan and 1.6 times as many on the Organization and Enterprise plans, according to Figma's FAQ. The price didn't change. Figma says "only the number of AI credits included at that price is increasing."

The credits included with each seat stayed the same, so only customers paying for extra usage got the better deal.

"What that means is you're potentially trading off near-term revenue, investing in your customers," CFO Praveer Melwani told CNBC.

Figma left the AI allowance inside each seat capped and made extra credits cheaper instead. Heavy users still pay for what they use beyond the seat, which is where the CFO's near-term revenue trade-off would show up. For seat-priced vendors weighing unlimited AI inside the seat, Figma made the opposite move.

Figma says it has been improving token efficiency and its own AI models, and that the share of work powered by its own design model more than doubled between July 1 and October 31.

Customers are using more AI

The number of weekly users consuming credits at customers paying more than $10,000 a year rose almost 50% between July 1 and October 31, according to Figma. As of October 31, Figma says, 65% of those customers were using the Figma agent each week, and more than 80% were consuming credits.

The agent became generally available on October 6. It used no credits during its beta, and it now draws from the same monthly budget as Figma's other AI tools.

Net dollar retention, a measure of how much existing customers' spending grows, was 131%. Figma counted 16,566 customers with more than $10,000 in annual recurring revenue and 1,717 with more than $100,000.

Figma's release doesn't break out revenue from credit add-ons.

Gross margin fell, but operating margin beat

Gross margin is the share of revenue left after the direct costs of delivering a product. Figma's non-GAAP gross margin was 82%, down from 86% a year earlier.

Other profit measures came in stronger. Figma's adjusted operating margin of 12% beat the 6.1% analysts expected, and it now expects 11% for the full year, up from 9%. Its net loss narrowed to $81.3 million from $1.10 billion a year earlier.

What this means for Figma investors

Figma expects fourth-quarter revenue of $402 million to $404 million. The agent started drawing on credits less than a week into that quarter, so the next report will be the first to show nearly a full quarter of agent usage counted against credits.

you're potentially trading off near-term revenue, investing in your customers

Figma's fourth-quarter report will show what gross margin looks like with the agent drawing on credits.

By Business of GTM