Summary
Figma reported fiscal 2025 second quarter revenue of $249.6 million, up 40.9% from the prior-year quarter. Year-to-date revenue reached $477.8 million, up 43.3%. The company attributed the top-line growth to new paid customers. Paid customers with more than $10,000 in annual recurring revenue rose to 11,906 from 9,071, and paid customers with more than $100,000 in ARR rose to 1,119 from 787. Net dollar retention was 129%, down from 130%. Figma also doubled its product portfolio in 2025 with Figma Sites, Figma Make, Figma Buzz, and Figma Draw, and it continues to invest in AI features across the platform.
Profitability improved sharply. Gross profit was $221.8 million in the quarter, up 61.1%, and gross margin was 88.8%, up 11.2 percentage points. Year-to-date gross profit was $430.5 million, up 53.2%, with a gross margin of 90.1%, up 5.8 percentage points. Operating income was $2.1 million, a swing to a profit from an operating loss a year earlier, and operating margin was 0.8%, up 505.5 percentage points. Year-to-date operating income was $41.8 million, also a swing to a profit, with an operating margin of 8.8%, up 273.2 percentage points. Net income was $28.2 million, a swing to a profit, and year-to-date net income was $73.1 million, also a swing to a profit. Diluted earnings per share was $0.00, up $4.39, and year-to-date diluted earnings per share was $0.10, up $4.63. Non-GAAP operating income was $11.5 million and non-GAAP operating margin was 5%; year-to-date non-GAAP operating income was $51.5 million and non-GAAP operating margin was 11%. The prior-year period included the May 2024 RSU Release, which the company said significantly increased operating expenses.
Cash generation turned positive. Operating cash flow was $62.5 million in the quarter and $159.6 million in the first half, up 181.3% from the prior-year first half. Capital expenditures were $1.1 million in the quarter and $2.0 million in the first half, up 122.6%. Free cash flow, which subtracts capital expenditures and capitalized internal use software costs, was $60.6 million in the quarter and $155.2 million in the first half. Adjusted free cash flow was also $60.6 million in the quarter and $155.2 million in the first half. Deferred revenue was $433.1 million, up 41.9% from the prior-year quarter, and remaining performance obligations were $448.8 million. On August 1, 2025, Figma completed its initial public offering, raising net proceeds of approximately $393.1 million. On July 30, 2025, the company drew $330.5 million under a new $500.0 million revolving credit facility to cover withholding and remittance obligations tied to RSU vesting, then used IPO proceeds to repay that borrowing.
Management expects AI investments to pressure margins. The company said AI inference and model training spend will affect cost of revenue and research and development, and it expects those investments to negatively impact gross margins and operating margins in the short term. For the full fiscal year 2025, Figma expects significant research and development, sales and marketing, and general and administrative expenses from the vesting and settlement of outstanding RSUs tied to the IPO. It also expects added public company costs. Free cash flow may fluctuate and could decrease as a percentage of revenue in future periods. The growth story still depends on adding new paid customers and expanding within the existing base, and net dollar retention slipped to 129% from 130%. The new revolving credit facility includes a financial covenant requiring liquidity of at least $100 million as of the last day of each fiscal quarter.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2025 | Q1 FY2025 | QoQ | Q2 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $249.6M | — | — | — | — |
| Gross profit | $221.8M | — | — | — | — |
| Gross margin | 88.8% | — | — | — | — |
| Research & development | $83.1M | — | — | — | — |
| Sales & marketing | $97.7M | — | — | — | — |
| General & administrative | $38.9M | — | — | — | — |
| Total operating expenses | $219.7M | — | — | — | — |
| Operating income (loss) | $2.1M | — | — | — | — |
| Operating margin | 0.8% | — | — | — | — |
| Net income (loss) | $28.2M | — | — | — | — |
| Net margin | 11.3% | — | — | — | — |
| Diluted EPS | $0.00 | — | — | — | — |
Risks
Developments in AI are already impacting the software industry, and the filing states AI may reduce the difficulty and cost for competitors to build and launch competitive products, alter the value of interface design, or decrease the number of designers, developers, and other collaborators that use Figma, which could lead to loss of revenue.
MD&A states that in the short term, AI investments and use of AI technologies, including spend on AI inference and model training, will impact cost of revenue, research and development expenses, and potentially sales and marketing expenses, and are expected to negatively impact gross margins and operating margins.
Figma generally relies on third-party models for AI features, and the filing warns that inability to access these technologies at scale, unfavorable pricing or terms, or termination of provider relationships could make the platform less appealing and harm results.
The EU AI Act entered into force in August 2024 and imposes fines for breaches of up to 7% of worldwide annual revenues, while California enacted seventeen AI laws in 2024 and Colorado and Utah have passed AI-focused legislation, increasing compliance costs and potential civil claims.
In March 2025 Figma moved away from user-driven upgrades so administrator approval is required before a seat is provisioned, introduced multi-product seats, and increased the price of its most expensive Full seat; the filing says these changes may inhibit seat upgrades, cause customer dissatisfaction, and lead to loss of customers.
Net Dollar Retention Rate was 129% as of June 30, 2025 compared with 130% as of June 30, 2024, and the filing states it expects Net Dollar Retention Rate to fluctuate or decline due to the growing revenue base, penetration within the customer base, and pricing and packaging changes.
Figma faces intense competition from companies covering multiple stages of design and development, point tools, and design-to-code and AI-driven companies and tools, and competitors may have greater resources, offer lower pricing, or bundle competing products at lower prices or for free.
An extended lock-up agreement covers holders of approximately 54.1% of outstanding Class A common stock, with tranches released beginning after earnings for the quarter ending September 30, 2025, and the filing states sales of a substantial number of shares upon expiration or early release could cause the market price of Class A common stock to fall.
As Figma increasingly sells to larger organizations, more extensive internal approval requirements may delay or prevent organic growth, and the March 2025 billing model update added administrator controls that may inhibit seat upgrades and increase customer acquisition costs.
Rapid growth and expansion have created technical debt within the platform, and addressing it requires engineering resources that could otherwise be devoted to new features; integrating AI capabilities may increase technical complexity and exacerbate these challenges.
Figma has experienced credential sharing, abuse of Figma for Education offerings, credit card fraud, and other misuse or fraud on its platform that result in bad debt, chargebacks, or other losses, and such incidents may increase as it grows.
Other income, net increased by $26.8 million, or 265%, for the three months ended June 30, 2025 compared with the prior-year quarter, primarily due to a $26.1 million increase in net unrealized gains on equity securities driven by a Bitcoin exchange traded fund, and the filing warns such investments are subject to credit, liquidity, market, and interest rate risks.
On June 27, 2025 Figma entered a $500.0 million revolving credit facility secured by liens on substantially all assets, with a financial covenant requiring liquidity of not less than $100 million as of the last day of each fiscal quarter, and drew $330.5 million on July 30, 2025.
The filing warns that weak global and regional economic conditions, tariffs, trade restrictions, inflation, interest rate volatility, and reduced software spending could result in longer sales cycles, pressure to lower prices, reduced sales, and slower growth, and notes that in 2023 Figma experienced a decline in usage and consumption from certain customers, especially larger enterprise customers.
SaaS KPIs
All quarters →Free Cash Flow Margin
Net Dollar Retention Rate
Adjusted Free Cash Flow Margin
Summary, forecast, risks and KPIs are extracted from Figma, Inc.'s SEC filings for Q2 FY2025 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Sep 24, 2026.