Figma beat earnings. Figma raised guidance. Figma gave customers more AI for the same price. The stock fell 7%.
Wall Street looked at a company handing out free stuff and called it a crime scene.
The numbers were fine. ,Revenue hit $391.4 million, up 43%, against $375.8 million expected., ,Adjusted earnings were 10 cents a share, twice the 5 cents analysts wanted., Twice. The market heard "twice" and sold anyway.
The offense was a help center page. ,Figma gave 2x more credits for the same cost on the Professional plan, and 1.6x on Organization and Enterprise., That's a discount. Figma ran a sale on itself.
CFO Praveer Melwani explained it plainly. ,He said the company is potentially trading off near-term revenue to grow durably over the long term., Translation: we're being nice now, we'll be rich later. Adults call this an investment. Traders call it a betrayal.
Consider the holder who bought Figma this year. ,The stock is down roughly 41% year to date, while the S&P 500 is up 12%., That person has been waiting all year for management to squeeze customers harder. Instead, management gave them a coupon.
Figma is also still losing money. ,It posted an $81.3 million net loss., But sure, the problem is generosity.
Here is my technical read. The chart went down. Before that, it went down. Before that, it also went down. Earnings have no vote. The line does what the line wants.
The long term is where Figma says the payoff lives. Retail traders don't own a long term. They own a phone and a margin call.
Figma gave away AI credits and lost 7%. Somewhere, a guy with a Figma position is mad that a design tool was nice to designers.
Photo by Mariia Berezovsky on Unsplash
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