Touted by some as the David to Adobe’s Goliath, design software upstart Figma’s (FIG) market value could be catching up to that of the company that nearly acquired it more quickly than even it expected.
Figma’s stock more than tripled in value in its first day of trading yesterday after an upsized initial public offering. And with Friday’s further jump —6% in recent trading—its market capitalization is approaching $60 billion, close to half of Adobe’s (ADBE).
That’s also roughly three times the $20 billion Adobe offered to pay for it in 2022, in what was widely seen as an acknowledgement that Figma could—at least in some ways—be beating the design giant at its own game. (Pressure from regulators, who viewed the bid as a bald attempt from Adobe to knock out competition, killed that deal.)
In the less than 10 years since Figma launched its software publicly in 2016, it’s become a mainstay of the design world, particularly for its strengths in real-time collaboration, interactive features, and AI integrations. An estimated 95% of Fortune 500 companies use it, with its clients including many tech heavyweights like Amazon (AMZN), Google parent Alphabet (GOOGL), Oracle (ORCL), and Netflix (NFLX).
Figma reported first-quarter net income of $44.9 million on revenue that jumped 46% year-over-year to $228.2 million, according to a regulatory filing. CEO Dylan Field, a budding billionaire thanks to this week’s gains, said he expects further growth, with big plans in AI.
Figma’s revenue surged 48% last year to $749 million. Adobe’s climbed 11% to $21.51 billion.
“Figma’s most innovative days are ahead,” he said in a blog post yesterday. “We’re already investing heavily in AI and we plan to double down even more in this area. AI spend will potentially be a drag on our efficiency for several years, but AI is also core to how design workflows will evolve going forward.”
Some high-profile investors are among those buying into Field’s vision. Cathie Wood’s Ark Invest, which focuses on companies it perceives as innovators and disruptors, was among those that piled into the stock yesterday, snapping up about 60,000 shares.
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