Shares of Figma Inc. experienced a decline of more than 13% in after-hours trading following the release of its first quarterly earnings report post-IPO. The graphic design software provider, which went public in July 2023, reported disappointing earnings that fell short of market expectations.
For the quarter ending on June 30, 2023, Figma announced earnings per share of zero cents, indicating a breakeven point, alongside revenue of $249.6 million. This figure marks a substantial year-over-year growth of 41%. Analysts had anticipated earnings of 18 cents per share, while revenue slightly surpassed expectations of $228.2 million.
Despite the earnings miss, Figma highlighted a strong customer base, reporting 11,096 paid customers with annual recurring revenue exceeding $10,000, and 1,119 customers generating over $100,000 in annual recurring revenue. The company also showcased a robust net dollar retention rate of 129%, reflecting the loyalty of its customer base.
Figma’s net income for the quarter was $28.2 million, and as of the end of June, the company held $1.6 billion in cash, cash equivalents, and marketable securities.
Product Launches and Future Outlook
During the quarter, Figma introduced four new products aimed at enhancing user experience. These included Figma Make, an AI-powered prototyping tool; Figma Draw, designed for richer visual expression; Figma Sites, which allows users to publish designs as live websites; and Figma Buzz, for creating marketing assets. The company also launched the Dev Mode MCP Server, a Model Context Protocol offering that enhances developer workflows by integrating design systems into generated code.
Figma hosted its annual user conference, Config, describing it as a significant investment in community engagement, customer relationships, and product development. Dylan Field, co-founder and CEO of Figma, expressed optimism in the company’s earnings release. “We delivered record revenue in Q2 as we continued to innovate with the launch of four new products,” he stated. “Looking ahead, we’re excited to keep building for our customers and help define the next era of digital products and experiences. Design is more important than ever and we have so much more to build.”
For the upcoming third quarter, Figma projects revenue between $263 million and $265 million, with a full-year revenue forecast of $1.021 billion to $1.025 billion. The company’s performance and strategic initiatives will be closely monitored as it navigates the competitive landscape of graphic design software.
