In a dramatic reversal for one of 2025’s most anticipated tech listings, Figma (FIG) has seen its stock price plunge nearly 75% to 80% from its all-time high as of January 29, 2026.
The design software leader, which made its debut on the New York Stock Exchange on July 31, 2025, has transitioned from a “meme-stock” darling to a cautionary tale of post-IPO volatility.
1. The “Broken IPO” Timeline
Figma’s journey as a public company has been a roller coaster of extreme highs and rapid corrections.
| Milestone | Date | Share Price | Valuation |
| IPO Pricing | July 31, 2025 | $33.00 | $19.3 Billion |
| All-Time High | August 2, 2025 | $142.92 | ~$60 Billion |
| Current Price | Jan 29, 2026 | $28.46 | ~$12 Billion |
2. Why Did Figma Fall So Far?
Analysts point to three primary factors that turned the “hottest tech offering of 2025” into a target for short-sellers:
- Unsustainable Peak Valuation: At its $142 peak, Figma was trading at 57x its 2025 revenue. As interest rates remained elevated throughout late 2025, investors aggressively dumped “expensive” growth stocks in favor of profitable veterans like Adobe.
- The “AI Armageddon” Fear: A prevailing market sentiment in 2026 suggests that generative AI (like OpenAI’s Sora and Adobe Firefly) might make manual UI/UX design tools obsolete. Despite Figma’s 38% revenue growth, the market is pricing in a “terminal threat” to its core business model.
- Lock-up Expiration (Jan 27, 2026): Just two days ago, the 180-day lock-up period for Figma insiders ended. The sudden flood of over 36 million shares onto the market by employees and early VCs has created massive downward pressure on the price.
3. Financials: Growth vs. Burn
While the stock price is struggling, the company’s underlying business remains a powerhouse, creating a significant “valuation gap.”
- Revenue Momentum: Figma is approaching a $1.3 billion annual run rate, with a healthy net dollar retention of 131%.
- Profitability Concerns: In Q3 2025, the company reported a $1.02 billion net loss, primarily due to one-time stock-based compensation (SBC) charges related to the aborted Adobe merger and the IPO.
- Market Share: Figma still holds a dominant 40.6% share of the design software market, significantly ahead of Adobe’s XD (13.5%).
4. Analyst Sentiment: “Drop-Dead Bargain”?
The massive 75% drop has divided Wall Street:
- The Bulls (Wells Fargo): Recently upgraded the stock to “Overweight,” arguing that at 12x sales, Figma is now a “bargain” compared to its peer group.
- The Skeptics (Goldman Sachs): Maintained a “Neutral” rating with a $40 target, citing the need for Figma to prove its AI-powered “Make” and “Sites” tools can drive a new leg of growth.
Conclusion: A High-Growth Underdog
Figma’s 75% slide is less about a failure of the product and more about a brutal correction of “IPO fever.” As the stock stabilizes near its original $33 IPO price, 2026 will be the year Figma must prove it can integrate AI to enhance human designers rather than being replaced by them. For long-term investors, the current $28 range represents the first time the company has been valued at a “private-market” level since its public debut.
