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Can FIG Accelerate Its Retention Rate With Seat Expansion?
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Key Takeaways
Figma's 139% net dollar retention rate is driven by seat expansion and broader platform adoption.
FIG relies on customer seat growth; weaker hiring or IT spending could slow retention and revenues.
Figma faces Adobe and Atlassian competition while trading at 11.91x forward sales.
Figma (FIG - Free Report) is growing on the back of strong seat expansion across its customer base, supported by large enterprise agreements, increasing adoption by developers and broader use of the platform beyond design teams.
Management noted that organizations are expanding Figma usage across product, engineering and business teams, which is helping drive the company’s industry-leading 139% net dollar retention rate. Its seat-plus-credit model also adds new consumption dynamics, which can lead to more quarter-to-quarter variability.
At the same time, this growth model carries risk. If hiring slows, enterprise technology budgets tighten, or companies cut software spending amid a weaker economy, seat expansion could slow.
Since Figma’s retention and revenue growth depend heavily on customers adding users and widening platform adoption, any slowdown in seat growth could weigh on net dollar retention and revenue growth. In addition, high infrastructure costs and AI serving expenses may continue to pressure margins.
The Zacks Consensus Estimate for FIG’s bottom line for 2026 is pegged at 23 cents per share, indicating a year-over-year decline of 23%. The estimates have remained unchanged for 60 days. This can be worsened by continued competitive pressure from larger players, leading Figma to offer its products at a low margin while spending on R&D at the same time.
How Competitors Fare Against Figma
Figma operates in a crowded design and product workflow market with established incumbents and newer AI-native tools, including AI coding tools, AI design tools, AI website builders and AI product-development platforms.
Figma faces constant competitive challenges from established players, including Adobe (ADBE - Free Report) and Atlassian (TEAM - Free Report) . Atlassian is focusing on adding generative AI features to some of its collaboration software.
Atlassian is partnering with Google Cloud to bring Atlassian’s AI-powered teamwork platform, including Jira, Confluence and Loom, onto Google’s AI-optimized infrastructure. Maintaining product leadership in this marketplace requires sustained investment and higher operating costs. Adobe recently partnered with Google Cloud to enhance Adobe’s creative ecosystem with AI.
Figma’s Share Price Performance, Valuation and Estimates
Figma shares have lost 35% year to date. The Zacks Internet - Software industry has declined 6.2% in the same period.
FIG YTD Performance Chart
Image Source: Zacks Investment Research
Figma stock is trading at a premium, with a forward 12-month Price/Sales of 6.99X compared with the Computer and Technology sector’s 4.00X. FIG has a Value Score of F.
FIG Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research
The consensus mark for 2026 earnings is pegged at 28 cents per share, which has increased 17.3% over the past 30 days. This indicates a 6.7% decline from the reported figure of 2025.
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Image: Bigstock
Can FIG Accelerate Its Retention Rate With Seat Expansion?
Key Takeaways
Figma (FIG - Free Report) is growing on the back of strong seat expansion across its customer base, supported by large enterprise agreements, increasing adoption by developers and broader use of the platform beyond design teams.
Management noted that organizations are expanding Figma usage across product, engineering and business teams, which is helping drive the company’s industry-leading 139% net dollar retention rate. Its seat-plus-credit model also adds new consumption dynamics, which can lead to more quarter-to-quarter variability.
At the same time, this growth model carries risk. If hiring slows, enterprise technology budgets tighten, or companies cut software spending amid a weaker economy, seat expansion could slow.
Since Figma’s retention and revenue growth depend heavily on customers adding users and widening platform adoption, any slowdown in seat growth could weigh on net dollar retention and revenue growth. In addition, high infrastructure costs and AI serving expenses may continue to pressure margins.
The Zacks Consensus Estimate for FIG’s bottom line for 2026 is pegged at 23 cents per share, indicating a year-over-year decline of 23%. The estimates have remained unchanged for 60 days. This can be worsened by continued competitive pressure from larger players, leading Figma to offer its products at a low margin while spending on R&D at the same time.
How Competitors Fare Against Figma
Figma operates in a crowded design and product workflow market with established incumbents and newer AI-native tools, including AI coding tools, AI design tools, AI website builders and AI product-development platforms.
Figma faces constant competitive challenges from established players, including Adobe (ADBE - Free Report) and Atlassian (TEAM - Free Report) . Atlassian is focusing on adding generative AI features to some of its collaboration software.
Atlassian is partnering with Google Cloud to bring Atlassian’s AI-powered teamwork platform, including Jira, Confluence and Loom, onto Google’s AI-optimized infrastructure. Maintaining product leadership in this marketplace requires sustained investment and higher operating costs. Adobe recently partnered with Google Cloud to enhance Adobe’s creative ecosystem with AI.
Figma’s Share Price Performance, Valuation and Estimates
Figma shares have lost 35% year to date. The Zacks Internet - Software industry has declined 6.2% in the same period.
FIG YTD Performance Chart
Image Source: Zacks Investment Research
Figma stock is trading at a premium, with a forward 12-month Price/Sales of 6.99X compared with the Computer and Technology sector’s 4.00X. FIG has a Value Score of F.
FIG Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research
The consensus mark for 2026 earnings is pegged at 28 cents per share, which has increased 17.3% over the past 30 days. This indicates a 6.7% decline from the reported figure of 2025.
Image Source: Zacks Investment Research
Figma currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.