Figma Stock Faces Post-IPO Turbulence: Earnings on Deck

Figma, Inc. (NYSE: FIG), the darling of the design and product development world, has experienced a rocky start to its public life. The stock is down a staggering 60% from its closing price on IPO day (July 31st, 2025). As the company prepares to announce its third-quarter 2025 financial results today, and with the IPO lock-up period expiring on November 7th, markets are bracing for potential volatility and reassessing the company’s long-term prospects.

Analysts currently project for FIG an earnings-per-share (EPS) of around $0.05, while average revenue estimates are at approximately US$263.95 million, indicating modest profitability paired with moderate top-line expectations.

Figma's IPO was initially met with immense enthusiasm. Priced at $33 per share, the stock soared to an intraday high of $142.92 on its debut, briefly valuing the company at over $33 billion. However, this euphoria proved short-lived. Subsequent market corrections and concerns about the company's valuation have led to a significant decline. The stock's 52-week range underscores this volatility, hitting a high of $142.92 and a low of $33.00.

The upcoming Q3 earnings announcement will be a critical test for Figma. In the second quarter of 2025, the company reported revenue of $249.6 million, a respectable 41% year-over-year increase. Operating income was a modest $2.1 million, translating to a 1% operating margin. While these figures demonstrate growth, they seemingly failed to meet the inflated expectations set by the initial IPO hype, triggering a sharp selloff in early September.

Adding to the uncertainty is the impending expiration of the IPO lock-up period. This event will release a flood of previously restricted shares into the market, potentially creating significant downward pressure on the stock price as early backers look to cash out. The sheer volume of shares becoming available could overwhelm demand, further exacerbating the existing concerns about Figma's valuation.

While the prevailing sentiment surrounding Figma's stock is cautious, a contrarian perspective suggests that the current downturn may present a compelling buying opportunity. The market may be overreacting to the lock-up expiration, underestimating Figma's long-term growth potential. The company's innovative platform, strong customer retention, and dominant position in the collaborative design space could position it for sustained success.

Furthermore, it's also worth noting that companies often experience a period of adjustment after going public, as they adapt to the pressures of the market and refine their business strategies.

Figma's management team has a track record of innovation and execution, and they may be able to navigate the challenges ahead and deliver strong results in the long run. A possible merger or acquisition is not out of the question either, and if the price is right, FIG could be an attractive target.

Ultimately, Figma's future hinges on its ability to maintain its growth trajectory, manage its expenses effectively, and navigate the competitive landscape. The upcoming Q3 earnings announcement will provide valuable insights into the company's performance and outlook.