Figma’s share price has plunged roughly 50-69% since its 2025 public debut, with a year-to-date drop of about 68.8% and a 12-month fall near 54%. The company is rolling out ChatGPT connectivity, a generative suite called Figma Weave, and third-party integrations as a deliberate attempt to turn AI features into new revenue streams. Through the first two quarters of fiscal 2025 Figma reported about $478 million in revenue and guided full-year sales to $1.021-1.025 billion, implying 37-40% growth for the year. Investors will judge those AI-led monetisation plans against the company revenue guidance when the fiscal year result arrives.

Start with the read. The market is treating Figma like a growth story that must deliver more than product momentum. That's why the roughly 68.8% year-to-date decline stings, and why management is now placing AI at the centre of its revenue case.

Why the share price collapsed

The valuation gap is the obvious place to begin. One valuation analysis using a discounted cash flow model puts intrinsic value at US$19.58 per share and concludes Figma is about 84.2% overvalued versus market price. That DCF cites last-twelve-month free cash flow near US$283.9 million and projects free cash flow around US$428.6 million by 2029. That conclusion is presented as single-source analysis and should be read accordingly.

Other coverage highlights divergent market signals. Some reports show a market capitalisation near US$27 billion as of late October 2025, while a separate snapshot records a market cap closer to US$9.9 billion with shares trading near US$20.27 in November. Price-to-sales multiples vary across accounts, with one analysis noting a ratio near 18.45x and others placing multiples above 25x. Whatever the exact number, the consistent fact is Figma sits well above typical software peers on those measures. That elevated multiple is what investors are debating while the stock grinds lower.

Numbers matter, and on the revenue front Figma has a cleaner story. Company disclosures cited by analysts show roughly US$478 million in revenue for the first two quarters of fiscal 2025, with guidance for the full year set narrowly between US$1.021 billion and US$1.025 billion. That implies annual growth in the order of 37-40% compared with the prior year. Quarterly reporting also noted Q3 revenue of US$274.2 million and an annualised revenue run rate above US$1 billion. One earnings summary points out free cash flow swung materially toward the positive in the most recent comparative window.

Mastheads

Can AI turn users into dollars?

Figma’s case for a valuation premium rests on what it can do to raise average revenue per user. The company is leaning on enterprise customer expansion as proof of concept. Recent disclosures show more than 1,200 customers paying over US$100,000 in annual recurring revenue, and about 12,910 customers at the US$10,000-plus ARR level. Net revenue retention is near 131% in the most recent quarter, and the business added 140 new US$100,000-plus customers in a single quarter.

Those figures explain why some investors still see optionality despite the sharp share-price decline.

Management and partners are positioning AI features as the engine to capture that optionality. OpenAI’s ChatGPT integration lets ChatGPT users interact directly with Figma content. Figma has also promoted Figma Weave, a generative AI feature set targeted at video, animation, motion design and VFX workflows. Reports also place collaborations with Google among the company’s product initiatives. Coverage frames these moves as ways to deepen engagement and to create paid tiers or add-ons that lift ARPU and make enterprise spend more predictable.

There is logic to the argument. Enterprise customers already account for a big share of revenue, and high net revenue retention suggests the installed base expands spend over time. If AI features convert a meaningful portion of users into higher-paying tiers, that will show up in revenue per customer and, eventually, in free cash flow. But the timing and scale of that conversion are the key unknowns. Some coverage treats the AI announcements as central to management’s response to valuation pressure. Others caution that lofty multiples assume a lot of future monetisation that hasn't yet been realised.

Analysts and retail research services present sharply divergent valuation signals, yet they agree on expectations. One side models a conservative intrinsic value and flags a large overhang. The other side points to rapid revenue growth and strong enterprise metrics as justification for a premium. Investors need to reconcile those views by watching incoming results against the company guidance.

For now the market has punished the gap between expectation and present performance. Figma has good growth and improving cash flow. It also carries multiples that force the company to deliver new revenue streams, not simply product upgrades. The AI rollouts are the clearest path to that outcome, but they're a path with milestones that will be judged by the revenue line and by enterprise uptake.

Related Articles

The near-term test is concrete. Figma’s fiscal 2025 revenue guidance of US$1.021 billion to US$1.025 billion will be the yardstick investors use to decide whether AI features and enterprise expansion are closing the valuation gap.

This article was created with AI assistance.