Wall Street spent months worrying that artificial intelligence would eat design software for breakfast. Figma looked especially vulnerable. Its stock crashed 85 percent from its 52-week high. Analysts questioned whether generative tools would turn collaborative design into a commodity. Then Bank of America reinstated coverage this week with a Buy rating and a $30 price target. The message was clear. AI isn’t a threat. It’s becoming Figma’s next growth engine.
The stock jumped nearly 11 percent in the five days after the note, according to Yahoo Finance. Shares now hover near $21.50. Market capitalization sits around $9.9 billion. That still leaves the company trading at roughly 8.9 times revenue. A discount to some peers. And far below the frothy levels that greeted its public debut.
But the valuation debate has shifted. Enterprise adoption and monetization trends matter more now than raw price-to-sales multiples. BofA analyst Tal Liani highlighted Figma’s superior growth profile. He projects revenue expansion of 35.6 percent in 2026 and 23 percent in 2027. Those figures top the software industry average of 19.3 percent and 15.7 percent respectively. Yahoo Finance covered the full call.
Figma didn’t wait for analysts to change their minds. The company rolled out AI features at a rapid clip. In May 2025 it introduced tools for generating websites, app prototypes, and marketing assets in bulk. A new drawing tool arrived alongside them. Marketers gained the ability to create branded visuals at scale. The moves positioned Figma against Canva, Adobe, and even AI website builders like Wix. TechCrunch reported the launch.
By December 2025 Figma added image-editing capabilities that echo Photoshop. Users could remove objects, isolate elements for repositioning, or extend images beyond original borders. These features landed in Figma Design and a newer drawing product. Plans called for broader rollout across the platform the following year. TechCrunch detailed the updates.
The pace quickened in 2026. Figma unveiled an AI agent for its collaborative canvas in May. Users direct it with natural language prompts. The agent generates designs, edits existing work, or automates repetitive tasks. Multiple agents can run simultaneously. It understands design context because the underlying models were fine-tuned for the job. Figma’s chief design officer Loredana Crisan captured the appeal. “Teams can now collaborate with agents on the multiplayer canvas to test out ideas, visualize edge cases, and refine concepts together without over-indexing on the more tedious parts.” TechCrunch quoted her directly.
June brought even more. At Config 2026 the company added code layers, motion support, shaders, and the ability to build custom plugins with AI prompts. Users connect external tools like Notion, Excel, or GitHub to give agents richer context. They create repeatable skills through simple text instructions. TechCrunch broke down the release. Figma’s own blog post on the Config recap reinforced the theme of limitless expression on a single canvas. CEO Dylan Field wrote that the updates help teams “push past what you thought was possible.”
These aren’t isolated experiments. Figma partnered with OpenAI, Anthropic, and Google to embed advanced models. Gemini variants now handle image editing and generation with reduced latency. One internal test showed a 50 percent drop in response time for image creation. The company also made its prompt-to-app tool, Figma Make, available to all users after an initial beta. It lets non-coders build working prototypes from natural language descriptions. The Verge noted the general availability.
Monetization has started to follow. Figma introduced a content seat plan at $8 per month that unlocks AI-heavy features across several products. Early results impressed investors. In May 2026 the company reported strong sales growth and highlighted traction from direct AI charges. Revenue guidance beat analyst estimates. Bloomberg captured the earnings reaction.
Liani’s note builds on that data. He argues generative AI will accelerate Figma’s long-run growth rather than disrupt it. Operating margins are forecast to rise from 9.2 percent in fiscal 2026 to 13.8 percent by 2028. Free cash flow margins follow a similar path. The $30 target reflects an 8 times multiple on calendar 2027 enterprise value to sales. That sits below the peer average despite Figma’s faster expansion. Yahoo Finance laid out the math.
Contrast the view with Adobe. BofA assigned Underperform and a $190 target to the larger rival. Different positioning in an AI-driven market explains the split opinion. Figma’s cloud-native collaborative roots and rapid product iteration give it an edge with younger teams and startups. Adobe carries more legacy weight.
Challenges remain. Figma stays unprofitable on a trailing basis. Early AI features drew criticism when one tool appeared to copy Apple’s Weather app design. The company quickly disabled it. CEO Dylan Field addressed the issue on X at the time. Yet the episode underscored risks around training data and originality. Later iterations focused on looser, more conceptual outputs to avoid exact replicas.
Even so, the trajectory looks promising. Thirteen million monthly active users now have access to an expanding AI toolkit. Agents handle tedious work. Designers focus on strategy and creativity. Developers edit code without leaving the canvas. Marketing teams generate assets at volume. The platform increasingly feels like a full product development environment rather than a design tool alone.
And the market noticed. Shares rose on the BofA call even as broader software names trade with caution. Volatility defined Figma since its IPO. The 52-week low near $16.60 tested investor patience. Current levels still reflect an 85 percent drawdown from peaks above $140. But sentiment has flipped. AI fears gave way to AI optimism.
Further updates keep coming. Recent releases allow multiple AI image edits to run in the background while designers continue working. Progress indicators track each task. Figma’s release notes highlight the change as a small but practical productivity boost. The company also expanded its Model Context Protocol server. AI models can now access design files remotely and see underlying code instead of flat images. That bridge matters for teams integrating design with engineering workflows.
Figma’s approach differs from pure play AI generators. It fine-tunes models on public community files rather than customer data. Privacy concerns ease. Context awareness improves because the models learn UI patterns from thousands of real interfaces. The result feels more native to design work than generic chatbots bolted on top.
Analysts will watch the next few quarters closely. Can Figma convert AI hype into sustained revenue acceleration? Will enterprise customers pay for the premium seats? Early signs point yes. The $8 content plan already shows traction. Partnerships with major AI labs suggest a steady feature pipeline.
So the stock that once looked like an AI casualty now trades as a beneficiary. Bank of America isn’t alone in seeing the shift. Other voices on Wall Street echo the view that collaborative design platforms stand to gain from smarter tools. The debate over valuation continues. Yet the focus has moved from defense to offense. Figma spent the past two years building. Investors finally appear ready to reward the effort.
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