Figma's IPO: Why Investing in Adobe Might Be the Better Bet

Adobe's stock may be a smart investment choice for investors due to Figma's IPO. The video discusses the potential risks and benefits of investing in Figma and suggests that buying Adobe could be a more stable option. Adobe's strong financial performance and established market position make it a potentially attractive investment.

Adobe Systems Inc. (ADBE) stock may experience a positive impact from the upcoming initial public offering (IPO) of Figma, a cloud-based collaborative design software. The Figma IPO is expected to launch on Thursday, with the company priced at $33 per share, above the expected range of $30 to $32 [1]. The software maker will trade under the ticker FIG and is valued at $19.3 billion, with the IPO expected to raise about $1.2 billion [1].

Figma offers web-based tools for collaborative design, a feature that differentiates it from Adobe's traditional desktop applications. The company has 13 million monthly active users and over 11,100 customers generating more than $10,000 in annual recurring revenue [1]. Its strong financial performance, with $749 million in revenue in 2025 and 91% gross margins, has been a draw for venture capital backers, including Kleiner Perkins, Greylock Partners, and Sequoia Capital [1].

Adobe's stock has retreated 15% in 2025, despite posting a modest beat-and-raise report for its fiscal second quarter ended May 30 [1]. The company earned an adjusted $5.06 per share on sales of $5.87 billion, up 13% year over year, and 11% in sales [1]. While Adobe's stock has been under pressure, its strong market position and established reputation make it a potentially attractive investment.

Investors should consider the potential risks and benefits of investing in Figma. A strong showing by Figma could herald a rebound in the IPO market, with more high-profile software IPOs like Netskope, Avalara, and SymphonyAI expected in the near term [1]. However, Figma faces an uphill climb to unseat Adobe as the industry standard software, with Adobe's incumbency advantage and strong balance sheet being significant factors [3].

Adobe's stock may benefit from Figma's IPO due to increased competition and potential market disruption. Investors should weigh the potential risks and benefits before making a decision. The Motley Fool Stock Advisor analyst team suggests considering Adobe as a more stable investment option compared to Figma [3].

References:
[1] https://www.investors.com/news/technology/figma-ipo-figma-stock-fig-stock-adobe-stock/
[2] https://www.investors.com/news/technology/figma-ipo-figma-stock-fig-stock-adobe-stock/?mod=newsviewer_click&refcode=aflMarketWatch&src=A00619
[3] https://www.aol.com/figma-goes-public-double-down-135910792.html