Figma Beats, Raises and Accelerates! Boom! Stock Rockets 12%! But … It Still Trades for Less than 10X ARR

Figma reported Q1, and the results were the cleanest “beat and raise and accelerate” you’ll see all earnings season in B2B + AI. Revenue accelerated for the second quarter in a row. NDR ripped to a 2+ year high. AI monetization, which everyone on the Street feared would never materialize, is actually working. The stock jumped about 12% overnight.

And yet … even after the incredible rip, Figma still trades for less than 10x ARR.

If a company growing 46% YoY at $1.3B ARR with 139% NDR and accelerating doesn’t get a premium multiple in 2026, the public markets seem, for now at least, to have just fallen out of love with almost the entire category. Because even if AI kills Figma at some point, it won’t be anytime soon.

Here are the numbers.

Q1 2026: Just a Total Crushing of Every Metric, And The Beginning of True Agentic Revenue

Figma generated revenue of $333.4 million, a 46% year-over-year increase in Q1, significantly surpassing the consensus analyst estimate of $316.3 million.

The acceleration is the real story. This marks the second consecutive quarter of accelerating revenue growth for Figma, following 40% growth in Q4 2025 and 38% growth in Q3 2025.

So the trend line goes 38% → 40% → 46%. That doesn’t happen by accident. That’s a B2B company crossing the chasm from “AI threat” to “AI beneficiary” in real time.

On the bottom line, the company reported non-GAAP net income of $0.10, comfortably above the $0.06 analysts had forecast.

5 Interesting Learnings From the Quarter

1. NDR Hit 139%, Their Highest in 2+ Years

Net dollar retention hit 139%, its highest in over two years, fueled by broad-based seat expansion and early enterprise adoption of Figma Make. That’s up 3 points from Q4.

For B2B founders, this is the single most important data point in the entire release. NDR going up while the customer base is also expanding 54% YoY is what acceleration actually looks like under the hood. Most public B2B companies are watching NDR slide. Figma’s is going the other direction.

2. Paid Customers Grew 54% YoY to ~690,000

This is the most bullish sign of all for any company, especially a high NRR software company.

Paying customers grew 54% year-over-year to approximately 690,000, while rising AI adoption drove a year-over-year increase of over 150% in new users switching to the Pro Team plan.

New Pro Team conversions up 150% YoY. The AI tools aren’t replacing seats. They’re upgrading them.

3. $100K+ ARR Customers Up 48% YoY

The enterprise motion is accelerating. 48% YoY growth in $100K+ ARR customers validate enterprise traction. This number also accelerated relative to Q4 2025.

This is the pattern you want to see in a maturing public B2B + AI company: total customers growing fast, but big customers growing even faster. Land and expand is alive and well at Figma.

4. AI Credit Monetization Is Already a Tailwind, Not a Drag

The AI monetization story is what most analysts have been worried about for two quarters. Figma launched it on March 18, so we’re looking at less than two weeks of contribution in the quarter. And it’s already meaningfully ahead of plan.

CFO Praveer Melwani highlighted that over 75% of over-limit enterprise users continued consuming credits in April.

That’s the data point. When 75%+ of your power users blow through their included credits and then keep paying for more, you’ve nailed the monetization model. This is essentially Snowflake-style consumption economics layered on top of seat-based SaaS pricing.

The cost side: Gross margin dipped to 82% on AI inference costs, but the company remains focused on optimizing gross profit dollars. 82% is still a beautiful gross margin for what’s now a hybrid AI-consumption business.

5. The “AI Is Killing Figma” Thesis Just Died. At Least For Now.

This was the bear case for the entire stock. New AI-native design tools and code-generation platforms were going to compress seats, automate work, and erode Figma’s collaborative moat.

The actual data: “$FIG The bear case for Figma was that AI would compress seats, automate design work, and erode its collaborative moat, but we are seeing the opposite — AI is expanding Figma’s seat footprint, not shrinking it,”

Dylan Field’s own X post said it best: “Quick update: not dead,” Figma CEO Dylan Field said on an X post, outlining the company’s Q1 performance. “Design matters more than ever,”

The Guidance Raise

The guide-up is bigger than the quarter itself. HubSpot had a strong quarter, but guided down, and the stock crashed.

For the full year 2026, Figma raised its revenue guidance to a range of $1.422 billion to $1.428 billion, implying 35% growth at the midpoint. This $55 million increase from its prior outlook is well above the current analyst revenue estimate of $1.376 billion.

Operating income guide also went up: Raises FY26 operating income view to $125M-$135M from $100M-$110M. That’s a 25%+ raise on operating income, which tells you the AI investments are scaling more efficiently than expected.

Q2 guide of $348 million to $350 million implies ~40% growth, which would mark a third consecutive quarter of acceleration if it holds.

Oh Yeah, Rule of 73 Quarter, Too

Non-GAAP operating margin was 16% in the quarter. Free cash flow was 27%, and we ended Q1 with $1.6 billion in cash equivalents, and marketable securities.

27% free cash flow margin while growing 46%. That’s a Rule of 73 quarter. Most public B2B companies would kill for a Rule of 50 in this environment.

Now The Gut-Punching Punchline: Still Under 10x ARR

The math on the multiple is the story.

Q1 revenue annualized comes out to roughly $1.33B in implied ARR. Even after the post-earnings pop, Figma’s market cap sits around $10-11B. That works out to about 7-8x implied ARR. For a software company growing 46%, accelerating, with 139% NDR and 27% free cash flow margins, that’s a remarkably tight multiple by any historical standard.

For comparison, here’s roughly where this kind of company would have traded in 2021: 30-40x ARR, maybe higher with this growth profile and NDR.

The stock is down 46% YTD and about 40% from their IPO price. Even after a 12% rip on a clean beat-and-raise-and-accelerate quarter.

So What’s Actually Going On In Public B2B Markets

Three things, all happening at once:

The public software re-rating is real and it’s not done. Even great results don’t restore 2021-era multiples. The market is repricing what “good” looks like across the entire category.

AI fear is overpriced into legacy B2B + AI names. Figma getting AI traction is the proof point. The companies that were supposed to die from AI disruption are turning out to be the biggest beneficiaries of it. Same will likely play out at Adobe, Atlassian, ServiceNow and the rest.

Private markets are dramatically disconnected from public ones. Anthropic, OpenAI, Cursor, Lovable are getting valued like the public software world doesn’t exist. The public software world is getting valued like AI doesn’t exist. Both can’t be right.

What I Almost Don’t Want to Type: You Need to Do Even Better to Justify Being a Unicorn

A 14-year-old design tool, going public into the worst possible window for B2B multiples, accused of being killed by AI, just put up a 46% accelerating quarter with 139% NDR and proved that AI monetization works when you have the underlying workflow and data.

That’s the playbook. AI doesn’t replace deep B2B workflow products. It expands them. It makes the seats more valuable. It makes the customers spend more. And eventually, even the public markets figure that out.

Just maybe not at 10x ARR yet.