Figma Shares Fell 29% in June Amid AI Uncertainty

Key Points

Shares of Figma (NYSE: FIG) declined sharply in June, reflecting a broader retreat among software stocks amid heightened concerns over AI-driven disruption, spurred in part by Anthropic’s April launch of the Claude Design product.

Although the stock fell, several analysts expressed optimism, and the share price steadied in the latter half of June before posting modest gains in early July.

S&P Global Market Intelligence reported that the stock declined 29% over the month, with the majority of the drop occurring in the first half.

FIG data by YCharts

What happened with Figma

Figma went public nearly a year ago; an initial surge following its IPO reversed as investors grew worried about its elevated valuation and potential disruption from AI‑native competitors.

Weak earnings from major software firms such as Salesforce, Adobe and Oracle amplified the sell‑off in early June, as investors feared that subscription‑based SaaS models like Figma could be displaced by emerging AI alternatives.

During the same period, Figma released limited updates, yet it remained a focal point of the so‑called “SaaS apocalypse,” with analysts questioning the durability of its design platform amid rising competition from AI‑driven tools and increasing churn among seat‑based users.

Figma’s price began to recover in the latter half of June after Citigroup initiated coverage with a buy rating and a $36 price target. The bank’s channel checks indicated robust AI adoption, including higher seat upgrades, suggesting upside potential for future quarters.

The company hosted its annual Config conference toward the end of June, unveiling new capabilities that let users embed code directly within Figma and transition seamlessly between design and code layers.

Although a few analysts voiced supportive views after the conference, their optimism failed to generate a substantial upward movement in the share price.

Image source: Getty Images.

What’s next for Figma

In July, Figma rebounded, recapturing more than half of the losses incurred in June by early July. The rally was supported by another buy recommendation and a broader shift of investor capital from overheated chip stocks back into software, driven by concerns about the sustainability of the chip rally.

Figma’s next earnings release is scheduled for August; if the company continues to achieve roughly 40% revenue growth, its shares are likely to continue rising.

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