Figma stock has slipped sharply this year and is hovering at its lowest level on record. It traded at $21.54 on Monday, down 85% from its all-time high. The retreat has coincided with growing “SaaSpocalypse” fears, as investors worry that AI tools such as Claude and ChatGPT could disrupt its business. Still, evidence suggests that the company’s growth remains intact.
Figma’s business is doing well despite SaaSpocalypse concerns
Figma is a top technology company in the design and collaboration industry. Its platform makes it easier for teams to implement tasks like UI and UX design, prototyping, and collaboration.
The company, like other top software firms, has come under pressure this year as AI tools get more advanced. Investors fear that the company could be ripe for disruption over time.
However, early evidence shows that the company’s growth is continuing, with more clients moving to its ecosystem. The most recent results showed that Figma’s revenue jumped by 48% last quarter to $370 million, much higher than its guidance and what analysts were expecting.
This growth came as both small and large companies joined Figma’s ecosystem. The number of customers paying more than $10,000 a year rose to nearly 16,000, while those paying more than $100,000 annually grew to 1,635.
The growth continued even as the company moved to a credit-based system, in which Professional plans receive 3,000 credits per month, Organization plans receive 3,500, and Enterprise plans receive 4,250. Additionally, SimilarWeb data shows that Figma’s website traffic has continued growing, hitting 77.5 million last month.
Wall Street analysts expect the company’s revenue growth to continue in the last quarter. The average estimate is that its revenue will come in at $376 million, up by 37% from the same period last year. For the year, analysts see its revenue rising by 39% to $1.47 billion, followed by $1.82 billion next year.
Figma’s management has remained confident that AI will not disrupt its business. Instead, it is leveraging AI to improve its business. This includes launching Figma agent, a first-party agent built into its canvas. It handles everything from automating tasks to generating motion animations. In a statement, the CEO said:
“The tools are changing, the creative possibilities are expanding and Figma finds itself at the forefront of this shift. We have so much work ahead and even more left to build for our customers.”
Most analysts tracking the company have a bullish outlook on the company. Wells Fargo has a target of $30, while Bank of America, Citigroup, and Morgan Stanley have targets of $33, $37, and $33, respectively.
Figma stock technical analysis
FIG stock chart | Source: TradingView
The daily chart shows that FIG stock slumped after its initial public offering. It reached a record low of $16.48 in April and then bounced back to $28 in June. The stock then retested the same level in June and bounced back to a high of $31.
Recently, however, Figma shares have remained below the 50-day moving average and Supertrend indicator. It is also slowly forming a bearish flag pattern. Therefore, the most likely scenario is that it drops and retests the support of $16.48, forming a triple-bottom pattern. In most cases, this pattern normally leads to a strong rebound. A drop below that level will point to more downside over time.
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