Figma, Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and the related notes and the discussion under the heading “Management's Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended December 31, 2024 included in the final prospectus for our initial public offering (“IPO”) dated as of July 30, 2025 and filed with the Securities and Exchange Commission (“SEC”), pursuant to Rule 424(b)(4), on July 31, 2025 (the “Final Prospectus”). This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements. The matters discussed in these forward-looking statements are subject to risk, uncertainties, and other factors that could cause actual results to differ materially from those made, projected or implied in the forward-looking statements. Please see the sections titled “Risk Factors” and “Special Note Regarding Forward-Looking Statements” appearing elsewhere in this Quarterly Report on Form 10-Q for a discussion of the uncertainties, risks, and assumptions associated with these statements.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and the related notes and the discussion under the heading “Management's Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended December 31, 2025 included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the Securities and Exchange Commission (the “SEC”) on February 18, 2026. This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements. The matters discussed in these forward-looking statements are subject to risk, uncertainties, and other factors that could cause actual results to differ materially from those made, projected or implied in the forward-looking statements. Please see the sections titled “Risk Factors” and “Special Note Regarding Forward-Looking Statements” appearing elsewhere in this Quarterly Report on Form 10-Q for a discussion of the uncertainties, risks, and assumptions associated with these statements.

Previous wording

In 2025, we doubled our product portfolio with the launch of four new products: Figma Sites, Figma Make, Figma Buzz, and Figma Draw. Figma Sites is a product that lets you design a website and directly publish it to the web, with a URL of your choice. Figma Make is an artificial intelligence (“AI”)-powered tool that turns a prompt into a fully functional prototype. Figma Buzz is a product for easily creating marketing assets like social media assets and digital ads at scale. And Figma Draw provides a dedicated space for finer vector editing required when drawing detailed iconography and product illustrations.

Current wording

In 2025, we doubled our product portfolio with the launch of four new products: Figma Make, Figma Sites, Figma Buzz, and Figma Draw. Figma Make lets users go directly from prompt to working prototype, at which point they can immediately validate an idea and choose to iterate on it. Users can improve the design of their product via further prompting, editing code directly, or through visual manipulation. Figma Sites is a product that lets you design a website and directly publish it to the web, with a URL of your choice. Figma Buzz is a product for easily creating marketing assets, like social media assets and digital ads, at scale. Figma Draw provides a dedicated space for finer vector editing required when drawing detailed iconography and product illustrations. We have also added our own Model Context Protocol (“MCP”) server, which allows developers to connect an agent in their code editor directly to designs in Figma. Developers can ask the agent to inspect the design and use this context to convert it into working code in their codebase.

Previous wording

With the addition of these new products and increasing AI functionality across our platform, Figma has expanded to help teams go from idea to shipped product all in one place. We believe AI will continue to accelerate this journey by helping users of all skill levels to ideate, iterate, and build faster. We are continuing to invest in AI so our customers can continue to innovate and push what is possible on our platform.

Current wording

With the addition of these new products and increasing AI functionality across our platform, Figma has expanded to help teams go from idea to shipped product all in one place. We believe AI will continue to accelerate this journey by helping users of all skill levels to ideate, iterate, and build faster. We are continuing to invest in AI so our customers can continue to innovate and push what is possible on our platform. We have also made acquisitions that expand Figma’s capabilities, such as Payload CMS, Inc., a leading open-source headless content management system, and Weavy Inc., now Figma Weave, which brings the world’s leading AI models together with professional editing tools on a single, browser-based canvas.

Previous wording

As we have grown our platform, we have also grown our community of both free and paying users, in part by offering enhanced features and functionality based on user and organizational needs. Our free Starter plan makes it easy for anyone to quickly get started with Figma and experience the benefits of our platform. More advanced functionality is available on our paid plans, including our Professional, Organization, and Enterprise plans, each of which are designed to meet the specific and sometimes complex needs of teams.

Current wording

As we have grown our platform, we have also grown our community of both free and paying users, in part by offering enhanced features and functionality based on user and organizational needs. Our free Starter plan makes it easy for anyone to quickly get started with Figma and experience the benefits of our platform. More advanced functionality is available on our paid plans, including our Professional, Organization, and Enterprise plans, each of which are designed to meet the specific and sometimes complex needs of teams. In 2025, we introduced AI credits across all Figma seats. In March 2026, we began enforcing AI credit limits and introduced flexible options for incremental usage, including monthly AI credit add‑ons to existing subscriptions or usage billed under a pay‑as‑you‑go model.

Previous wording

months following the measurement date is renewed on existing terms.2 ARR is not a forecast of future revenue, which can be impacted by contract start and end dates and renewal rates.

Current wording

We calculate annual recurring revenue (“ARR”) as the annualized value of our active customer agreements as of the measurement date, assuming any agreement that expires during the next twelve months following the measurement date is renewed on existing terms.2 ARR is not a forecast of future revenue, which can be impacted by contract start and end dates and renewal rates.

Previous wording

We believe that the number of Paid Customers with more than $10,000 in ARR on our platform is an important indication of the value that our products deliver. We define a Paid Customer with more than $10,000 in ARR as a Paid Customer with a total of $10,000 or more of ARR as of the last day of the applicable period of measurement. We believe that $10,000 in ARR is an important threshold, as it is a strong indicator of significant paid usage of our products.

Current wording

We believe that the number of Paid Customers with more than $10,000 in ARR on our platform is an important indication of the value that our products deliver. We define a Paid Customer with more than $10,000 in ARR as a Paid Customer with a total of $10,000 or more of ARR as of the last day of the

Previous wording

We define non-GAAP operating income and non-GAAP operating margin as income (loss) from operations and operating margin, respectively, excluding stock-based compensation expense, amortization of stock-based compensation expense included in capitalized internal use software development costs, employer payroll taxes on employee stock transactions, and amortization of acquired intangibles from acquisitions. Additionally, we exclude certain non-recurring charges, including transaction costs and other related expenses associated with the Abandoned Merger with Adobe and 2024 Tender Offer transaction costs. Non-GAAP operating margin represents non-GAAP operating income as a percentage of revenue.

Current wording

We define non-GAAP operating income and non-GAAP operating margin as income (loss) from operations and operating margin, respectively, excluding stock-based compensation expense, amortization of stock-based compensation expense included in capitalized internal use software development costs, employer payroll taxes on employee stock transactions, and amortization of acquired intangibles from acquisitions. Additionally, we exclude certain non-recurring charges, such as impairment losses on long-lived assets. Non-GAAP operating margin represents non-GAAP operating income as a percentage of revenue.

Previous wording

We define Free Cash Flow as GAAP net cash provided by (used in) operating activities less capital expenditures and capitalized internal use software development costs, if any. Adjusted Free Cash Flow is a non-GAAP financial measure that we calculate as Free Cash Flow plus transaction costs and other related expenses associated with the Abandoned Merger with Adobe and estimated income taxes related to the Abandoned Merger with Adobe. Adjusted Free Cash Flow Margin represents Adjusted Free Cash Flow divided by revenue. Transaction costs and other related expenses include legal, accounting, professional services fees, local business taxes and non-recurring compensation expenses related to the transaction. We believe that Free Cash Flow and Adjusted Free Cash Flow are useful indicators of liquidity that provide information to management and investors about the amount of cash generated from our core operations that, after the purchases of property and equipment and capitalized internal use software development costs, can be used for strategic initiatives, including investing in our business, making strategic acquisitions, and strengthening our balance sheet. We have adjusted our Free Cash Flow by transaction costs and other related expenses associated with the Abandoned Merger with Adobe, and estimated income taxes attributable to the Abandoned Merger with Adobe because we do not expect such items to occur in the future periods and we believe that this provides greater comparability across periods. Free Cash Flow and Adjusted Free Cash Flow have limitations as analytical tools, and they should not be considered in isolation or as substitutes for analysis of other GAAP financial measures, such as net cash provided by (used in) operating activities. Some of the limitations of Free Cash Flow and Adjusted Free Cash Flow are that these metrics do not reflect our future contractual commitments and may be calculated differently by other companies in our industry, limiting their usefulness as comparative measures. We expect our Free Cash Flow to fluctuate in future periods as we invest in our business to support our plans for growth. These activities, along with certain increased operating expenses as described below, may result in a decrease in Free Cash Flow as a percentage of revenue in future periods.

Current wording

Free Cash Flow Margin represents Free Cash Flow divided by revenue. We believe that Free Cash Flow is a useful indicator of liquidity that provides information to management and investors about the amount of cash generated from our core operations that, after the purchases of property and equipment and capitalized internal use software development costs, can be used for strategic initiatives, including investing in our business, making strategic acquisitions, and strengthening our balance sheet. Free Cash Flow has limitations as an analytical tool, and it should not be considered in isolation or as a substitute for analysis of other GAAP financial measures, such as net cash provided by operating activities. Some of the limitations of Free Cash Flow are that it does not reflect our future contractual commitments and may be calculated differently by other companies in our industry, limiting its usefulness as a comparative measure. We expect our Free Cash Flow to fluctuate in future periods as we invest in our business to support our plans for growth. These activities, along with certain increased operating expenses as described below, may result in a decrease in Free Cash Flow as a percentage of revenue in future periods.

Previous wording

The following table presents our cash flows for the periods presented and a reconciliation of Free Cash Flow and Adjusted Free Cash Flow to net cash provided by (used in) operating activities, the most directly comparable financial measure calculated in accordance with GAAP:

Current wording

The following table presents our cash flows for the periods presented and a reconciliation of Free Cash Flow to net cash provided by operating activities, the most directly comparable financial measure calculated in accordance with GAAP:

Previous wording

(3)Operating Cash Flow Margin is calculated as net cash provided by (used in) operating activities divided by revenue.

Current wording

(2)Operating Cash Flow Margin is calculated as net cash provided by operating activities divided by revenue.

Previous wording

(4)Adjusted Free Cash Flow Margin is a non-GAAP financial measure that is calculated as Adjusted Free Cash Flow divided by revenue.

Current wording

(3)Free Cash Flow Margin is a non-GAAP financial measure that is calculated as Free Cash Flow divided by revenue.

Previous wording

We generate revenue from sales of subscriptions to our platform. Our subscription agreements generally have monthly or annual contractual terms. Our agreements are generally non-cancelable and we typically invoice our customers in advance. At the end of each quarterly period of the contract, we invoice certain customers for additional seats added during the quarter, inclusive of amounts due for services delivered and amounts due for the remaining term of the subscription. We record deferred revenues when cash payments are received or due in advance of our performance, including amounts which are refundable and revenue is recognized ratably over the related contractual term.

Current wording

We primarily generate revenue from sales of subscriptions to our platform. Our subscription agreements generally have monthly or annual contractual terms. Our agreements are generally non-cancelable and we typically invoice our customers in advance. At the end of each monthly or quarterly period of the contract, we invoice customers for additional purchases made during the respective month or quarter, inclusive of amounts due for services delivered and amounts due for the remaining term of the subscription. We record deferred revenues when cash payments are received or due in advance of our performance and revenue is typically recognized ratably over the related contractual term.

Previous wording

Our revenue is driven primarily by the number of paying customers and the price we charge for access to our platform, which varies based on the type of plan and products to which a customer subscribes.

Current wording

Our revenue is driven primarily by the number of paying customers and the price we charge for access to our platform, which varies based on the type of plan and products to which a customer subscribes. In March 2026, we began enforcing AI credit limits and introduced flexible options for incremental usage, including monthly AI credit add‑ons to existing subscriptions or usage billed under a pay‑as‑you‑go model.

Previous wording

Employee-Related Costs and Overhead Allocation. Employee-related costs include salaries, bonuses and benefits, and stock-based compensation and related employer payroll taxes for cost of revenue and each operating expense category. Overhead costs represent shared costs that are not specific to a functional group and are allocated based on headcount. Such costs include costs associated with office facilities, IT-related personnel expenses, depreciation of property and equipment, and other expenses, such as software subscription fees. As such, allocated shared costs are reflected in cost of revenue and each operating expense category.

Current wording

Employee-Related Costs and Overhead Allocation. Employee-related costs include salaries, bonuses, benefits, and stock-based compensation and related employer payroll taxes for cost of revenue and each operating expense category. Overhead costs represent shared costs that are not specific to a functional group and are allocated based on headcount. Such costs include costs associated with office facilities, workplace and IT-related personnel expenses, depreciation of property and equipment, and other expenses, such as software subscription fees. As such, allocated shared costs are reflected in cost of revenue and each operating expense category.

Previous wording

AI and Related Costs. As a part of our product innovation, we have made and will continue to make significant investments to integrate AI, including generative AI, into our platform. We expect that the use of AI technologies and our investments to integrate AI into our platform will impact our business, operating results, and financial condition. For example, in the short-term, we expect that our AI investments and use of AI technologies, including spend on AI inference and model training, will impact our cost of revenue, research and development expenses, and potentially impact our sales and marketing expenses, which we expect to negatively impact our gross margins and operating margins. Given the newness and rapid development of these technologies, the impacts on our gross margins and operating margins, and our business, operating results, financial condition, and future prospects over the longer term are currently unknown.

Current wording

AI and Related Costs. As a part of our product innovation, we have made and will continue to make significant investments to integrate AI, including generative AI, into our platform. We expect that the use of AI technologies and our investments to integrate AI into our platform will impact our business, operating results, and financial condition. For example, in the short-term, we expect that our AI investments and use of AI technologies, including spend on AI inference and model training, will impact our cost of revenue, research and development expenses, and sales and marketing expenses, which we expect to negatively impact our gross margins and operating margins. Given the newness and rapid development of these technologies, the impacts on our gross margins and operating margins, and our business, operating results, financial condition, and future prospects over the longer term are currently unknown.

Previous wording

Cost of revenue consists primarily of technical infrastructure and hosting costs, including AI inference, employee-related costs, including stock-based compensation and related employer payroll taxes, for infrastructure and product support teams for paid users of Figma, payment processing fees, amortization of capitalized internal-use software development costs, amortization of developed technologies, and allocated overhead. Depending on the timing of investments in our platform, including those related to our AI initiatives, we expect that our cost of revenue will increase in absolute dollars as our business grows and will fluctuate as a percentage of our revenue from period-to-period depending on the timing of these investments.

Current wording

Cost of revenue consists primarily of technical infrastructure and hosting costs, including AI inference, employee-related costs, including stock-based compensation and related employer payroll taxes, for infrastructure and product support teams for paid users of Figma, payment processing fees, amortization of capitalized internal-use software development costs, amortization of acquired developed technologies, and allocated overhead. Depending on the timing of investments in our platform, including those related to our AI initiatives, we expect that our cost of revenue will increase in absolute dollars as our business grows and will fluctuate as a percentage of our revenue from period-to-period depending on the timing of these investments.

Previous wording

Research and development. Our research and development expenses consist primarily of employee-related costs, including stock-based compensation and related employer payroll taxes, technical infrastructure and hosting costs, professional services fees, software subscription fees, and allocated overhead. We expense our research and development costs as they are incurred, other than capitalized internal-use software development costs. Our research and development expenses as a percentage of revenue of 248% and 111% for the three and nine months ended September 30, 2025, respectively, were primarily driven by the stock-based compensation expense and related employer payroll taxes for RSUs in which the performance-based and service-based vesting conditions had been satisfied in connection with the IPO. Our research and development expenses as a percentage of revenue of 52% and 130% for the three and nine months ended September 30, 2024, respectively, were primarily driven by the stock-based compensation expense related to the May 2024 RSU Release and the 2024 Stock Option Grants. Over time, we expect that our research and development expenses will increase in absolute dollars relative to our research and development expenses prior to 2024 and 2025, as we continue to invest in our platform. However, depending on the timing of our investments, including those related to our AI initiatives, we anticipate that research and development expenses may fluctuate as a percentage of our revenue from period-to-period.

Current wording

Research and development. Our research and development expenses consist primarily of employee-related costs, including stock-based compensation and related employer payroll taxes, technical infrastructure and hosting costs, professional services fees, software subscription fees, impairment of long-lived assets, and allocated overhead. We expense our research and development costs as they are incurred, other than capitalized internal-use software development costs. Over time, we expect that our research and development expenses will increase in absolute dollars relative to our research and development expenses prior to 2025, as we continue to invest in our platform. However, depending on the timing of our investments, including those related to our AI initiatives, we anticipate that research and development expenses may fluctuate as a percentage of our revenue from period-to-period.

Previous wording

Sales and marketing. Our sales and marketing expenses consist primarily of employee-related costs, including stock-based compensation and related employer payroll taxes, expenses associated with our marketing and brand advertising campaigns, events, such as annual user conferences, including Config, amortization of sales commissions, amortization of acquired customer relationships, professional services fees, software subscription fees, and allocated overhead. Additionally, we classify within sales and marketing technical infrastructure and hosting costs as well as overhead costs for our infrastructure and product support teams related to the users of our free version of Figma. We capitalize and subsequently amortize sales commissions and related expenses, including associated payroll taxes and 401(k) contributions, over the estimated period of benefit, which we have determined to be four years. Our sales and marketing expenses as a percentage of revenue of 100% and 59% for the three and nine months ended September 30, 2025, respectively, were primarily driven by the stock-based compensation expense and related employer payroll taxes for RSUs in which the performance-based and service-based vesting conditions had been satisfied in connection with the IPO. Our sales and marketing expenses as a percentage of revenue of 40% and 77% for the three and nine months ended September 30, 2024, respectively, were primarily driven by the stock-based compensation expense related to the May 2024 RSU Release and the 2024 Stock Option Grants. Over time, we expect that our sales and marketing expenses will increase in absolute dollars relative to our sales and marketing expenses prior to 2024 and 2025, as our business grows and we continue to scale our go-to-market organization. However, depending on the timing of our investments, including those related to our AI initiatives, we anticipate that sales and marketing expenses will fluctuate as a percentage of revenue from period-to-period.

Current wording

Sales and marketing. Our sales and marketing expenses consist primarily of employee-related costs, including stock-based compensation and related employer payroll taxes, expenses associated with our marketing and brand advertising campaigns, events, such as annual user conferences, including Config, amortization of sales commissions, amortization of acquired customer relationships, professional services fees, software subscription fees, and allocated overhead. Additionally, we classify within sales and marketing technical infrastructure and hosting costs, including AI inference, as well as overhead costs for our infrastructure and product support teams related to the users of our free version of Figma. We capitalize and subsequently amortize sales commissions and related expenses, including associated payroll taxes and 401(k) contributions, over the estimated period of benefit, which we have determined to be four years. Over time, we expect that our sales and marketing expenses will increase in absolute dollars relative to our sales and marketing expenses prior to 2025, as our business grows and we continue to scale our go-to-market organization. However, depending on the timing of our investments, including those related to our AI initiatives, we anticipate that sales and marketing expenses will fluctuate as a percentage of revenue from period-to-period. In addition, historically, we have experienced seasonal fluctuations in our sales and marketing expenses incurred in connection with our annual user conferences, including Config, which we typically host in the second quarter of each year, as well as in connection with other advertising efforts.

Previous wording

General and administrative. Our general and administrative expenses consist primarily of employee-related costs, including stock-based compensation and related employer payroll taxes, for our legal, finance, human resources, and other administrative teams, as well as certain executives. In addition, general and administrative expenses include general business expenses, professional services fees, software subscription fees, and allocated overhead. We expect to incur additional expenses as a result of operating as a newly public company, including costs to comply with the rules and regulations applicable to companies listed on a national securities exchange, costs related to compliance and reporting obligations, and increased expenses for insurance, investor relations, and professional services. Our general and administrative expenses as a percentage of revenue of 135% and 59% for the three and nine months ended September 30, 2025, respectively, were primarily driven by the stock-based compensation expense and related employer payroll taxes for RSUs in which the performance-based and service-based vesting conditions had been satisfied in connection with the IPO. Our general and administrative expenses as a percentage of revenue of 22% and 54% for the three and nine months ended September 30, 2024, respectively, were primarily driven by the stock-based compensation expense related to the May 2024 RSU Release the 2024 Stock Option Grants. Over time, we expect that our general and administrative expenses will increase in absolute dollars relative to our general and administrative expenses prior to 2024 and 2025, as our business grows. However, we anticipate that general and administrative expenses will decrease as a percentage of revenue over time, although these expenses may fluctuate as a percentage of our revenue from period-to-period depending on the timing of these expenses.

Current wording

General and administrative. Our general and administrative expenses consist primarily of employee-related costs, including stock-based compensation and related employer payroll taxes, for our legal, finance, human resources, and other administrative teams, as well as certain executives. In addition, general and administrative expenses include general business expenses, professional services fees, software subscription fees, and allocated overhead. We expect to incur additional expenses as a result of operating as a newly public company, including costs to comply with the rules and regulations applicable to companies listed on a national securities exchange, costs related to compliance and reporting obligations, and increased expenses for insurance, investor relations, and professional services. Over time, we expect that our general and administrative expenses will increase in absolute dollars relative to our general and administrative expenses prior to 2025, as our business grows. However, we anticipate that general and administrative expenses will decrease as a percentage of revenue over time, although these expenses may fluctuate as a percentage of our revenue from period-to-period depending on the timing of these expenses.

Previous wording

Other income, net consists primarily of interest income earned on our cash, cash equivalents, and marketable securities, income from digital assets, unrealized and realized gains or losses on equity securities, which includes our investments in a Bitcoin exchange traded fund and strategic investments, gains or losses on foreign currency exchange, amortization of deferred financing costs, interest, and commitments expense on our revolving credit facility, and miscellaneous other expenses.

Current wording

Other income (expense), net consists primarily of interest income earned on our cash, cash equivalents, and marketable securities, income from digital assets, current, unrealized and realized gains or losses on equity securities, which includes our investment in a Bitcoin exchange traded fund and strategic investments, remeasurement gains or losses on our investment in Bitcoin, which is included within digital assets, non-current on the condensed consolidated balance sheets, gains or losses on foreign currency exchange, amortization of deferred financing costs, interest, and commitments expense on our Revolving Credit Facility (as defined below), and miscellaneous other expenses.

Previous wording

Provision for (benefit from) income taxes consists of U.S. federal and state income taxes and income taxes in certain foreign jurisdictions in which we conduct business. We maintain a full valuation allowance on our federal, state and foreign deferred tax assets as we have concluded that it is not more likely than not that the deferred tax assets will be realized.

Current wording

Provision for income taxes consists of U.S. federal and state income taxes and income taxes in certain foreign jurisdictions in which we conduct business. We maintain a full valuation allowance on our federal, state and foreign deferred tax assets as we have concluded that it is not more likely than not that the deferred tax assets will be realized.

Previous wording

The following tables set forth our condensed consolidated statement of operations data for the periods indicated:

Current wording

The following tables set forth our condensed consolidated statements of operations data for the periods indicated:

Previous wording

The following tables set forth our condensed consolidated statement of operations data expressed as a percentage of revenue for the periods indicated:

Current wording

The following tables set forth our condensed consolidated statements of operations data expressed as a percentage of revenue for the periods indicated:

Previous wording

Revenue increased by $75.5 million, or 38%, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The increase in revenue was primarily due to the addition of new Paid Customers, as our number of Paid Customers with more than $10,000 in ARR and Paid Customers with more than $100,000 in ARR increased by 32% and 44%, respectively, as of September 30, 2025 compared to the prior year.

Current wording

Revenue increased by $105.2 million, or 46%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase in revenue was primarily driven by growth and expansion in total Paid Customers, as the number of Paid Customers with more than $10,000 in ARR and Paid Customers with more than $100,000 in ARR increased by 37% and 48%, respectively, as of March 31, 2026 compared to the prior year.

Previous wording

Cost of revenue increased by $65.2 million, or 349%, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The increase was primarily due to a $43.2 million increase in employee-related costs driven by a $41.0 million increase in stock-based compensation expense and related employer payroll taxes, $17.6 million of higher technical infrastructure and hosting costs due to AI-related costs and increased usage of our platform for paid users, $2.8 million of higher amortization of capitalized internal-use software development costs and acquired intangibles, and $1.4 million of higher payment processing fees.

Current wording

Cost of revenue increased by $49.2 million, or 253%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase was primarily due to a $33.7 million increase in technical infrastructure and hosting costs relating to AI and increased usage of our platform by paid users, an $8.7 million increase in employee-related costs primarily driven by $5.6 million of stock-based compensation expense and related employer payroll taxes recognized in connection with the completion of our initial public offering (our “IPO”) in July 2025, and $4.4 million of higher amortization of capitalized internal-use software development costs and acquired intangibles from acquisitions.

Previous wording

Research and development expenses increased by $576.7 million, or 554%, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The increase was primarily due to a $570.7 million increase in employee-related costs driven by a $552.8 million increase in stock-based compensation expense and related employer payroll taxes, a $3.1 million increase in allocated overhead costs to support the growth of our business, and a $1.2 million increase in technical infrastructure and hosting costs, primarily driven by AI-related costs as we improved and extended our product offerings and developed new technologies.

Current wording

Research and development expenses increased by $103.0 million, or 147%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase was primarily due to a $93.3 million increase in employee-related costs primarily driven by $84.8 million of stock-based compensation expense and related employer payroll taxes recognized in connection with the completion of our IPO in July 2025 and increased headcount due to the growth of our business, and a $4.5 million increase in technical infrastructure and hosting costs, primarily driven by AI-related costs as we improved and extended our product offerings and developed new technologies.

Previous wording

Sales and marketing expenses increased by $195.5 million, or 247%, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The increase was due to a $179.1 million increase in employee-related costs driven by a $170.5 million increase in stock-based compensation expense and related employer payroll taxes, a $7.0 million of higher technical infrastructure and hosting costs for users of our free version of Figma due to continuing growth in our user base and AI-related costs as we rolled out our AI offerings to free users during the period, $5.6 million of higher spend related to marketing and advertising expenses, and a $1.4 million of higher sales commission expense due to the year-over-year sales growth.

Current wording

Sales and marketing expenses increased by $56.7 million, or 82%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase was due to a $38.3 million increase in employee-related costs primarily driven by $25.0 million of stock-based compensation expense and related employer payroll taxes recognized in connection with the completion of our IPO in July 2025, and increased headcount due to the growth of our business, $8.0 million of higher technical infrastructure and hosting costs for users of our free version of Figma due to continuing growth in our user base and AI-related costs as we continued to roll out our AI offerings to free users during the period, and $5.4 million of higher spend related to marketing and advertising expenses.

Previous wording

The benefit from income taxes decreased by $56.4 million, or 105%, for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The provision for income taxes recorded in the nine months ended September 30, 2025 was primarily due to income tax expense related to our foreign subsidiaries. The benefit from income taxes recorded in the nine months ended September 30, 2024 was primarily due to anticipated carry back of our research and development tax credit resulting from the May 2024 RSU Release.

Current wording

The provision for income taxes decreased by $1.5 million, or 68%, for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. The provision for income taxes recorded for the three months ended March 31, 2026 was primarily due to taxes in foreign jurisdictions. The provision for income taxes recorded in the three months ended March 31, 2025 was primarily due to our estimated U.S. federal taxable income position as of March 31, 2025.

Previous wording

As of September 30, 2025, our principal sources of liquidity were cash and cash equivalents of $340.5 million, digital assets of $30.3 million, marketable securities of $1.2 billion, and restricted cash of $10.8 million. Our Revolving Credit Facility (as defined below) also serves as a source of liquidity. Cash and cash equivalents are comprised of bank deposits, money market funds, U.S. agency securities, U.S. treasury securities, corporate bonds, and commercial paper. Digital assets are comprised of USDC, a stablecoin redeemable on a one-to-one basis for U.S. dollars. Marketable securities are comprised of commercial paper, U.S. agency securities, U.S. treasury securities, corporate bonds, and a Bitcoin exchange traded fund. Restricted cash consists of unsecured letters of credit outstanding related to leased office space in San Francisco, California and New York, New York and bank deposits related to our self-funded health insurance plan. Substantially all cash and cash equivalents are held in the United States. Since our inception, we have financed our operations primarily through proceeds from the issuance of our convertible preferred stock and common stock and cash generated from the sale of our products. On August 1, 2025, we completed our IPO, in which we issued and sold an aggregate of 12.5 million shares of Class A common stock at a public offering price of $33.00 per share, resulting in net proceeds to us of approximately $393.1 million after deducting underwriting discounts and commissions, but before deducting offering expenses payable by us.

Current wording

As of March 31, 2026, our principal sources of liquidity were cash and cash equivalents of $405.7 million, digital assets, current of $15.7 million, which is comprised of holdings in USDC, and marketable securities of $1.2 billion. Our Revolving Credit Facility also serves as a source of liquidity. Cash and cash equivalents are comprised of bank deposits, money market funds, U.S. agency securities, U.S. treasury securities, corporate bonds, and commercial paper. Digital assets, current on the condensed consolidated balance sheets is comprised of USDC, a stablecoin redeemable on a one-to-one basis for U.S. dollars. Marketable securities are comprised of commercial paper, U.S. agency securities, U.S. treasury securities, corporate bonds, and a Bitcoin exchange traded fund. The majority of our cash and cash equivalents are held in the United States, with the remainder held in international regions to support our foreign operations. Since our inception, we have financed our operations primarily through proceeds from the issuance of our convertible preferred stock and common stock and cash generated from the sale of our products. On August 1, 2025, we completed our IPO, in which we issued and sold an aggregate of 12.5 million shares of Class A common stock at a public offering price of $33.00 per share, resulting in net proceeds to us of approximately $393.1 million after deducting underwriting discounts and commissions, but before deducting offering expenses payable by us.

Previous wording

We believe that our current cash, cash equivalents, digital assets, and marketable securities, in addition to amounts available for borrowing under our Revolving Credit Facility, will be sufficient to fund our operations for at least the next twelve months. Our future capital requirements, however, will depend on many factors, including our subscription growth rate, the timing and extent of spending to support our research and development efforts, our investments and usage of AI, the expansion of sales and marketing activities, the introduction of new and enhanced products and features, particularly for large organizations, and the continuing market adoption of Figma. We may in the future enter into arrangements to acquire or invest in complementary businesses, services, and technologies, including intellectual property rights. In the event that additional financing is required from outside sources, we may seek to raise additional funds at any time through equity, equity-linked arrangements, and debt. If we are unable to raise additional capital when desired and at reasonable rates, our business, results of operations, and financial condition would be adversely affected. See the section titled “Risk Factors—Risks Related to Financial and Accounting Matters—We may require additional capital to fund our business and support our growth, and any inability to generate or obtain such capital may adversely affect our operating results and financial condition.”

Current wording

We believe that our current cash, cash equivalents, digital assets, current, and marketable securities, in addition to amounts available for borrowing under our Revolving Credit Facility, will be sufficient to fund our operations for at least the next twelve months. Our future capital requirements, however, will depend on many factors, including our subscription growth rate, the timing and extent of spending to support our research and development efforts, our investments in and usage of AI, the expansion of sales and marketing activities, the introduction of new and enhanced products and features, particularly for large organizations, and the continuing market adoption of Figma. We have historically, and may in the future, enter into arrangements to acquire or invest in complementary businesses, services, and technologies, including intellectual property rights. In the event that additional financing is required from outside sources, we may seek to raise additional funds at any time through equity, equity-linked arrangements, and debt. If we are unable to raise additional capital when desired and at reasonable rates, our business, results of operations, and financial condition would be adversely affected. See the section titled “Risk Factors—Risks Related to Financial and Accounting Matters—We may require additional capital to fund our business and support our growth, and any inability to generate or obtain such capital may adversely affect our business, operating results, and financial condition” included in Part II, Item 1A of this Quarterly Report on Form 10-Q.

Previous wording

Our principal commitments consist of our operating lease commitments, future purchase commitments for cloud hosting services, and other commitments consisting of future minimum payments under non-cancelable purchase commitments. Our non-cancelable commitments are disclosed in Note 8 “Commitments and Contingencies” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

Current wording

Our principal commitments consist of our operating lease commitments, future purchase commitments for cloud hosting services, and other commitments consisting of future minimum payments under non-cancelable purchase commitments. Our significant non-cancelable commitments are disclosed in Note 7 “Commitments and Contingencies” to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Previous wording

On June 27, 2025, we entered into a credit agreement (the “Revolving Credit Agreement”) with Morgan Stanley Senior Funding, Inc., as administrative agent and collateral agent, Bank of America, N.A., JPMorgan Chase Bank, N.A., Goldman Sachs Bank USA, Wells Fargo Securities, LLC and RBC Capital Markets, LLC as joint lead arrangers and bookrunners, the letter of credit issuers from time to time party thereto, and the lenders from time to time party thereto, which provides for a revolving credit facility (the “Revolving Credit Facility”) of up to $500.0 million and a subfacility of up to $150.0 million for letters of credit. The Revolving Credit Facility provides us with the right to increase the Revolving Credit Facility and/or to add one or more tranches of term loans or to increase the amount of any existing term loans in an aggregate principal amount not to exceed (a) $2.0 billion, plus (b) the amount of any voluntary prepayments of term loans and/or the Revolving Credit Facility (to the extent accompanied by a permanent reduction of commitments under the Revolving Credit Facility), plus (c) an additional amount, if after giving effect to the incurrence of such additional amount, we do not exceed a maximum debt to EBITDA ratio in accordance with the Revolving Credit Agreement.

Current wording

On June 27, 2025, we entered into a credit agreement (the “Revolving Credit Agreement”) with Morgan Stanley Senior Funding, Inc., as administrative agent and collateral agent, Bank of America, N.A., JPMorgan Chase Bank, N.A., Goldman Sachs Bank USA, Wells Fargo Securities, LLC and RBC Capital Markets, LLC as joint lead arrangers and bookrunners, the letter of credit issuers from time to time party thereto, and the lenders from time to time party thereto. The Revolving Credit Agreement provides for a revolving credit facility of up to $500.0 million and a subfacility of up to $150.0 million for letters of credit (the “Revolving Credit Facility”). The Revolving Credit Agreement provides us with the right to increase the Revolving Credit Facility and/or to add one or more tranches of term loans or to increase the amount of any existing term loans in an aggregate principal amount not to exceed (a) $2.0 billion, plus (b) the amount of any voluntary prepayments of term loans and/or the Revolving Credit Facility (to the extent accompanied by a permanent reduction of commitments under the Revolving Credit Facility), plus (c) an additional amount, if after giving effect to the incurrence of such additional amount, we do not exceed a maximum debt to EBITDA ratio in accordance with the Revolving Credit Agreement.

Previous wording

The Revolving Credit Agreement contains a financial covenant requiring that Liquidity (defined as unrestricted cash and cash equivalents, plus the undrawn revolver commitments) is not less than $100 million as of the last day of each fiscal quarter. Additionally, the Revolving Credit Agreement contains customary affirmative and negative covenants (including restrictions on indebtedness, liens, investments, asset dispositions and affiliate transactions, each subject to customary exceptions and baskets) and customary events of default (including, among other things, non-payment of principal, interest or fees, inaccuracy of representations and warranties, violation of certain covenants, cross-default to certain other indebtedness, bankruptcy and insolvency events, material judgments, change of control and certain material ERISA events). The obligations under the Revolving Credit Facility are secured by liens on substantially all of our assets. The Revolving Credit Facility matures on June 27, 2030.

Current wording

The Revolving Credit Agreement contains a financial covenant requiring that Liquidity (defined as unrestricted cash and cash equivalents, plus the undrawn revolver commitments) is not less than $100.0 million as of the last day of each fiscal quarter. Additionally, the Revolving Credit Agreement contains customary affirmative and negative covenants (including restrictions on indebtedness, liens, investments, asset dispositions and affiliate transactions, each subject to customary exceptions and baskets) and customary events of default (including, among other things, non-payment of principal, interest or fees, inaccuracy of representations and warranties, violation of certain covenants, cross-default to certain other indebtedness, bankruptcy and insolvency events, material judgments, change of control and certain material ERISA events). The obligations under the Revolving Credit Agreement are secured by liens on substantially all of our assets. The Revolving Credit Facility matures on June 27, 2030.

Previous wording

September 30, 2025, we had no outstanding balance under the Revolving Credit Facility and our total available borrowing capacity under the Revolving Credit Facility was $500.0 million. We were in compliance with all applicable covenants as of September 30, 2025.

Current wording

As of March 31, 2026, we had no outstanding balance under the Revolving Credit Facility and our total available borrowing capacity under the Revolving Credit Facility was $500.0 million. We were in compliance with all applicable covenants as of March 31, 2026.

Previous wording

During the nine months ended September 30, 2025, operating activities provided $210.8 million in cash. The primary factors affecting our cash flows during this period were our net loss of $1.0 billion, adjusted for $1.1 billion from non-cash charges, and net cash inflows of $85.7 million from changes in our operating assets and liabilities. The non-cash charges primarily consisted of $1.1 billion of stock-based compensation expense, net of amounts capitalized, $15.0 million of amortization of deferred commissions, $13.2 million of non-cash operating lease costs, and $9.5 million of depreciation and amortization expense, partially offset by $21.6 million in unrealized gains from the remeasurement of equity securities, and $12.5 million in net accretion of discounts on marketable securities. The cash provided from changes in our operating assets and liabilities was primarily due to a $92.2 million increase in deferred revenue related to increased billings, a $57.7 million increase in accrued compensation and benefits as a result of our increased headcount associated with the growth of our business, implementation of a company-wide annual bonus program and withholdings retained from employees for the initial employee stock purchase plan offering period that commenced in connection with the IPO, and a $6.1 million increase in accounts payable. These amounts were partially offset by a $29.8 million increase in prepaid expenses and other current assets, a $25.5 million increase in accounts receivable, and a $15.6 million increase in other assets.

Current wording

During the three months ended March 31, 2026, operating activities provided $97.3 million in cash. The primary factors affecting our cash flows during this period were our net loss of $142.4 million, adjusted for $205.1 million from non-cash charges, and net cash inflows of $34.6 million from changes in our operating assets and liabilities. The non-cash charges primarily consisted of $169.0 million of stock-based compensation expense, net of amounts capitalized, $15.6 million in unrealized losses from the remeasurement of equity securities, and $6.5 million of amortization of deferred commissions. The cash provided from changes in our operating assets and liabilities was primarily due to a $32.3 million increase in deferred revenue related to increased billings and a $59.5 million decrease in accounts receivable, reflecting an increase in collections driven by increased billings in the prior period. These amounts were partially offset by a $44.0 million decrease in accrued compensation and benefits, which includes the impact of a $56.1 million payment under our annual corporate bonus program, and a $18.2 million increase in other assets.

Previous wording

During the nine months ended September 30, 2024, operating activities used $134.8 million in cash. The primary factors affecting our cash flows during this period were a net loss of $829.9 million and net cash outflows of $267.0 million from changes in our operating assets and liabilities, adjusted for $962.1 million in non-cash charges. The non-cash charges primarily consisted of $947.4 million in stock-based compensation expense, net of amounts capitalized, $10.5 million of non-cash operating lease costs, $10.3 million of amortization of deferred commissions, and $6.1 million of depreciation and amortization expense, partially offset by $11.3 million in net accretion of discounts on marketable securities. The cash used by changes in our operating assets and liabilities was primarily due to a $252.4 million decrease in accrued and other current liabilities largely driven by income taxes paid related to the termination fee received in connection with the Abandoned Merger with Adobe in December 2023, a $69.9 million increase in other assets due to an increase in income taxes receivable, and a $13.5 million increase in prepaid expenses and other current assets. These amounts were partially offset by a $70.8 million increase in deferred revenue due to increased billings, and a $12.5 million increase in accrued compensation and benefits as a result of our increased headcount associated with the growth of our business.

Current wording

During the three months ended March 31, 2025, operating activities provided $97.2 million in cash. The primary factors affecting our cash flows during this period were our net income of $44.9 million and net cash inflows of $38.5 million from changes in our operating assets and liabilities, adjusted for $13.8 million from non-cash charges. The non-cash charges primarily consisted of $8.3 million in unrealized loss from the remeasurement of equity securities, $4.7 million of amortization of deferred commissions, and $4.1 million of non-cash operating lease costs. The cash provided from changes in our operating assets and liabilities was primarily due to a $25.3 million increase in deferred revenue related to increased billings and an $18.0 million decrease in accounts receivable, net, reflecting an increase in collections. These amounts were partially offset by a $9.2 million increase in prepaid expenses and other current assets, primarily driven by prepaid hosting services.

Previous wording

Net cash used in investing activities during the nine months ended September 30, 2024 was $720.8 million, which was primarily due to the purchase of marketable securities of $1.1 billion, and the capitalization of internal-use software development costs of $2.9 million, partially offset by proceeds from sales and maturities of marketable securities of $358.2 million.

Current wording

Net cash used in investing activities during the three months ended March 31, 2026 was $7.4 million, which was primarily due to the purchase of marketable securities of $262.9 million and capital expenditures of $7.8 million, partially offset by proceeds from sales and maturities of marketable securities of $263.9 million.

Previous wording

Net cash used in investing activities during the nine months ended September 30, 2025 was $294.4 million, which was primarily due to the purchase of marketable securities of $1.0 billion, the purchase of digital assets of $30.0 million, $21.0 million of cash paid for business combinations, the purchase of intangible assets of $5.1 million, and capital expenditures of $3.7 million, partially offset by proceeds from sales and maturities of marketable securities of $784.0 million.

Current wording

Net cash provided by investing activities during the three months ended March 31, 2025 was $41.3 million, which was primarily due to the proceeds from sales and maturities of marketable securities of $283.3 million, partially offset by the purchase of additional marketable securities of $238.8 million.

Previous wording

Net cash provided by financing activities during the nine months ended September 30, 2024 was $1.2 million, which was primarily due to the proceeds from the sale of common stock in connection with the May 2024 RSU Release of $419.0 million, partially offset by $418.1 million used to pay the employee portion of taxes related to the net share settlement of RSU awards in connection with the May 2024 RSU Release.

Current wording

Net cash used in financing activities during the three months ended March 31, 2026 was $87.5 million, which was primarily due to $116.2 million used to pay the employee portion of taxes related to the net share settlement of equity awards, partially offset by proceeds from option exercises of $28.9 million.

Previous wording

There have been no material changes to our critical accounting policies and estimates as compared to those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” set forth in our Final Prospectus.

Current wording

There have been no material changes to our critical accounting policies and estimates as compared to those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on February 18, 2026.