Key Takeaways:
Figma Inc. (FIG) shares rose more than 9% in after-hours trading after the company announced first-quarter financial results that surpassed analyst expectations and raised its full-year revenue forecast, citing accelerating adoption of its artificial intelligence tools.
"The results validate our AI strategy," Figma CEO Dylan Field said. "We're seeing strong seat expansion across entire organizations, which is a testament to the value our platform provides in a world increasingly powered by visual communication."
For the quarter ended March 31, the design software company reported revenue of $333.4 million, a 46% increase from the same period last year. Adjusted earnings came in at $0.10 per share. Both figures topped Wall Street estimates, which had projected revenue of $313.2 million and earnings of $0.06 per share.
The strong performance was driven by a 48% year-over-year growth in customers with over $100,000 in annual recurring revenue and a net dollar retention rate of 139%. The company also generated $88.6 million in free cash flow during the quarter.
Looking ahead, Figma boosted its fiscal 2026 revenue guidance to between $1.422 billion and $1.428 billion, an increase from its prior range of $1.36 billion to $1.37 billion. For the second quarter, the company anticipates revenue between $348 million and $350 million, also ahead of the consensus estimate of $327 million.
The guidance raise signals management's confidence that demand for its AI-powered design and collaboration tools will continue to grow. Investors will be watching the company's upcoming earnings call for more details on the impact of AI on margins and the competitive landscape.
This article is for informational purposes only and does not constitute investment advice.
