Figma(FIG) - 2025 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Figma achieved $250 million in revenue for Q2 2025, marking a new quarterly revenue record and representing a 41% year-over-year growth [8][44]. - The company maintained a non-GAAP operating margin of 5% and an adjusted free cash flow margin of 24% [8][48]. - Gross margin for the quarter was reported at 90%, with expectations of further compression due to investments in AI products [46][47]. Business Line Data and Key Metrics Changes - Figma launched four new products at the Config conference: Figma Make, Figma Draw, Figma Sites, and Figma Buzz, effectively doubling its product offering [13][34]. - Over 80% of customers utilized two or more products, and two-thirds used three or more products during Q2 [44]. Market Data and Key Metrics Changes - The company localized its product and support for Korean and Brazilian Portuguese markets, which resonated well with customers in those regions [37]. - Figma's platform is increasingly being adopted by large enterprises, with notable examples including Itau Unibanco and Nubank in Latin America [38]. Company Strategy and Development Direction - Figma aims to build a durable, long-term business focused on serving the evolving needs of designers and product development teams, with significant investments planned in AI [11][12]. - The company is committed to transparency and may adjust its reporting framework as the business evolves [8][9]. Management's Comments on Operating Environment and Future Outlook - Management expressed excitement about the role of design in a software landscape increasingly influenced by AI, emphasizing that design is a critical differentiator for companies [39][40]. - The company plans to deepen investments in AI and other growth opportunities, indicating a willingness to take significant swings when opportunities arise [11][86]. Other Important Information - Figma ended the quarter with $1.6 billion in cash, cash equivalents, and marketable securities, including approximately $91 million in a Bitcoin exchange-traded fund [49]. - The company has established a new annual guidance framework for operating income, reflecting its commitment to finding timely investment opportunities [51][53]. Q&A Session Summary Question: Context on the ramp of new products and monetization - Management acknowledged that new products are still early in their lifecycle but noted strong initial engagement, particularly with Figma Draw and Figma Sites [58][59]. Question: Quantifying the impact of Figma Make on full seat usage - Management indicated that they are working on monetization strategies for Figma Make and have seen broad usage across different personas, including developers and marketers [66][68]. Question: Competitive environment and differentiation - Management highlighted that Figma Make's unique integration with design context sets it apart from competitors, and they are excited about customer engagement with the product [68][69]. Question: User demographics for Figma Make - Management noted that Figma Make is attracting a diverse range of users, including product managers and marketers, expanding the platform's reach beyond traditional designers [72][74]. Question: Future cash usage and investment strategy - Management confirmed that the $1.6 billion cash reserve provides flexibility for investments in AI and other growth areas, with a focus on high-priority opportunities [82][84].