Stifel has cut its price target on Figma Inc. (NYSE: FIG) to $30 from $40 and kept a Hold rating, according to the firm’s latest assessment. The revised target equates to about 20% upside from the recent trading price of $24.89.
The downgrade arrived after Figma posted fourth-quarter results and issued fiscal 2026 revenue guidance that topped estimates, a set of announcements that sent the stock more than 15% higher in after-hours trading. Despite that immediate rally, Figma shares have suffered notable declines over longer horizons, falling 79% over the past year and 35% year-to-date, per InvestingPro data.
Stifel's view on AI and margins
Stifel characterized Figma as a likely near-term AI beneficiary, pointing to a strong AI partner ecosystem and healthy adoption of the company’s Make product. The firm also observed that Figma is stepping up AI-related spending to take advantage of disruption in the design and collaboration space.
Yet the analyst flagged an important uncertainty: the long-term effect of AI on the UI/UX design market. Specifically, Stifel questioned how much the user interface will matter if intelligent agents begin to perform significant portions of design work. The firm described assessing these consequences as complex, and this uncertainty partly underpins its Hold rating.
Stifel also highlighted concerns about margin implications driven by heavier AI investment and uncertainty around the timing and magnitude of increased consumption that could occur when credit limits are enforced in March and beyond. Those factors leave the firm reluctant to move to a more positive rating.
Financial context and company performance
Figma delivered a robust fourth quarter, with revenue of $303.8 million, representing 40% year-over-year growth. Adjusted earnings per share came in at $0.08, which exceeded analyst expectations of $0.06. Non-GAAP gross margins were reported at 86.2%, and operating margins stood at 14.5% - both above consensus estimates.
InvestingPro data cited by analysts shows Figma maintaining a strong gross profit margin of 84.76%, a level that provides the company financial flexibility to fund AI initiatives. Stifel noted that these healthy margins are a factor in Figma’s ability to increase AI spending, though they do not remove the longer-term margin-risk questions tied to AI adoption.
Other analyst reactions
Piper Sandler reaffirmed an Overweight rating and kept a $35.00 price target, citing the company’s strong quarterly results and optimistic fiscal 2026 guidance, which projects 30% year-over-year revenue growth - about 7 percentage points above consensus. By contrast, RBC Capital reduced its price target to $31 from $38 while retaining a Sector Perform rating.
Analysts attributed the quarter’s strength to broader platform adoption and AI integration across Figma’s customer base. Those themes underscore why some firms remain bullish even as others temper expectations based on margin and consumption uncertainties.
Market implications
The juxtaposition of strong near-term execution and persistent longer-term questions captures why opinions on Figma remain mixed. The company’s financial profile and product momentum support further investment in AI, but the ultimate impact of that spending on margins and how customers consume the platform once credit limits are applied remain open questions.
Investors will likely be watching upcoming quarters for signs that AI-driven features both expand usage and preserve or enhance profitability.