Figma Inc. (FIG) shares rose more than 6% on Tuesday following Bank of America's decision to reinstate coverage of the design software company with a Buy rating. The brokerage set a $30 price target, arguing that artificial intelligence is strengthening Figma's competitive position and opening new revenue streams.
AI as a Competitive Moat
Bank of America analyst Tal Liani noted that Figma's collaborative platform provides a distinct advantage as AI-generated content becomes more prevalent in software development and product design. Unlike traditional design tools focused on individual creative work, Figma is built for team collaboration on complex projects such as user interfaces and digital product development.
While AI can automate parts of the design process, Liani argued that enterprises still need a centralized platform to organize, refine, and integrate AI-generated work into production-ready products. Figma has embedded AI capabilities into its existing pricing model through a combination of seat-based subscriptions and usage-based AI credits.
“This structure allows Figma to introduce a direct pathway to monetize incremental AI usage as adoption scales, without disrupting or cannibalizing its core [software-as-a-service] model,” Liani wrote.
Early Monetization Success
Bank of America pointed to early signs that the strategy is generating additional revenue. During the first quarter of 2026, 75% of enterprise customers that exceeded their AI credit allocations purchased additional credits, while more than 95% remained active on the platform. Figma ended the quarter with 690,000 paid users, a 53% increase year-over-year.
The brokerage also reinstated coverage of Adobe Inc. with an Underperform rating and a $190 price target, contrasting the two companies' positioning as generative AI reshapes the design software market. Both stocks have declined sharply in 2026 amid concerns that AI tools could reduce demand for traditional design software, but BofA believes Figma is better positioned to benefit.
Growth Outlook and Valuation
Bank of America expects Figma to continue outpacing the broader software industry. The firm forecasts revenue growth of 35.6% in 2026 and 23% in 2027, compared with peer averages of 19.3% and 15.7%, respectively. Operating margins are projected to improve from 9.2% in 2026 to 13.8% by 2028 as AI investments mature.
Enterprise adoption remains a key driver, with customers generating over $100,000 in annual recurring revenue expected to grow 26.2% in 2026 and more than 22% annually through 2028. Although Figma trades at a premium valuation—roughly 7.6 times estimated next-12-month sales versus Adobe's 3.2 times—the brokerage believes the premium is justified.
“We acknowledge increasing AI-driven competitive risks across the design ecosystem, but believe these risks are already reflected in the current valuation,” Liani said.
For context on AI's broader market impact, see our coverage of TeraWulf Stock Jumps 17% on $19B Anthropic AI Data Center Lease Deal and Microsoft Stock Jumps 4% on Haleon AI Deal, Job Cut Reports.
Risks Remain
Despite the positive outlook, Bank of America highlighted risks including slower-than-expected AI adoption, stronger competition from AI-native design platforms, and weaker monetization of AI features. Even so, the firm believes Figma is positioned as an AI beneficiary rather than an AI casualty.
This article is for informational purposes only and does not constitute financial advice.
