Shares of Figma sank 7.7% in after-hours trading to $20.50 after the design-software company delivered a third quarter that topped Wall Street expectations on every headline metric — then guided to a fourth quarter that suggests the growth engine is cooling.

  • The Numbers Were Strong, but the Next Quarter Tells a Different Story. Figma reported third-quarter revenue of $391.4 million, beating estimates of $375.8 million.

Adjusted earnings came in at $0.10 per share, nearly double the $0.06 consensus. Yet Q4 revenue guidance of $402–$404 million implies year-over-year growth in the low-to-mid 30s — a clear step down from the 43% growth posted this quarter and the 48% growth in Q2. For a stock that trades on its growth rate, not its profits, that deceleration matters enormously.

  • AI Is Driving Revenue but Also Eating Into Profitability. Gross margin — the share of revenue left after covering direct costs — came in at 80%, slightly below the 81% analysts expected. That continues a steady slide from 92% in 2024 to 82.4% in 2025 , driven by the cost of running AI features, which pushed hosting and infrastructure expenses up 112% year-over-year in 2025. Figma's CFO recently conceded uncertainty about returning to prior margin levels, saying "I would be willing to take the hit on margin…if it means that we're able to serve a much larger total addressable market." Translation: profits take a back seat to user growth for now.

  • The Raised Outlook Still Fell Short of the Hype. Figma lifted its full-year revenue target to $1.497–$1.499 billion from $1.463–$1.467 billion, and now expects adjusted operating income of $158–$163 million at an 11% margin, up from the prior 9% forecast. That's a meaningful upgrade, but the stock has plunged from a $115 first-day close after its July 2025 IPO to roughly $20 , and investors are demanding more than incremental guidance raises to justify any re-acceleration.

  • Competition Adds Another Layer of Risk. Analysts are watching whether AI competition fears — particularly from rival Canva — outweigh Figma's revenue momentum.

Free cash flow of $41.5 million this quarter and 16,566 customers spending more than $10,000 annually show the core business is healthy, but not healthy enough to calm a market fixated on the growth trajectory's direction.