Figma Q3 2026 Earnings: Revenue Up 43% as AI Hosting Costs Squeeze Gross Margin

Figma beat its own revenue guidance by $16.4 million in the third quarter of 2026: revenue rose 43% to $391.4 million. The cost of serving that revenue grew faster. Cost of revenue rose 27% from the June quarter to $77.0 million while revenue rose 6%, and the 10-Q names the cause: technical infrastructure and hosting costs "relating to AI." Leaving out stock-based compensation, cost of revenue took 18.8% of revenue this quarter, up from 15.8% in the June quarter and 8.0% in 2024, by our computation from the ledger. Figma is selling AI credits faster than it expected, and every one of those credits carries a compute bill a seat licence never did.

The quarter's revenue beat came with a bigger cost bill​

Revenue of $391.4 million compared with $274.2 million a year earlier and with Figma's August guidance of $373 million to $375 million (earnings release). CFO Praveer Melwani said "customers continued to expand seats and invest more deeply in Figma" and that customers are "moving from trying AI to making larger commitments." The release backs the AI part with usage counts: as of October 31, 65% of paid customers with more than $10,000 of annual recurring revenue used the Figma agent weekly and over 80% consumed AI credits.

GAAP gross margin was 80%, against 69% a year earlier. That comparison flatters the quarter: the September 2025 quarter carried $1.14 billion of stock-based compensation recognized on the July 2025 IPO, $43.0 million of it in cost of revenue. Against the June quarter, GAAP gross margin fell from 83.7% to 80.3%. The company's non-GAAP gross margin, which excludes stock compensation and a few other items, fell to 82% from 86% a year earlier. In the 10-Q, technical infrastructure and hosting costs rose $29.5 million year over year, while employee costs in cost of revenue fell $39.1 million, almost entirely because stock compensation was lower.

The treemap shows research and development, $205.2 million, as the largest cost, then sales and marketing ($130.7 million), general and administrative ($97.7 million) and cost of revenue ($77.0 million). Stock compensation of $158.6 million is inside those lines as filed, $85.4 million of it in research and development. GAAP loss from operations was $119.2 million. Other income of $47.3 million, lifted by a favorable change in the fair value of Figma's bitcoin exchange-traded fund, and a $9.5 million tax charge left a net loss of $81.3 million. The company's non-GAAP operating income was $47.0 million, a 12% margin, the same as a year earlier.

What the ledger shows: cost of revenue is growing faster than revenue​

Each row is one reported period: revenue as a negative credit, cost of revenue as a debit and Equity:Adjustments as net income, negative for a loss. Each cost-of-revenue posting carries its stock compensation in a comment, so it can be taken out. By our computation, cost of revenue without stock compensation was 8.8% of revenue in 2023, 8.0% in 2024, 12.7% in 2025, 15.8% in the June 2026 quarter and 18.8% in the September quarter. Revenue grew 2.1 times from 2023 to 2025; that cost grew 3.0 times. The table also keeps the 2023 profit of $737.8 million in view, which came from the $1 billion termination fee Adobe paid when its acquisition of Figma was abandoned, not from operations.

The arithmetic matters for a software company because gross margin is what pays for research, sales and eventually profit. A subscription seat costs almost nothing to serve. An AI credit costs inference compute every time it is used. A small software business adding an AI feature faces the same choice: price the usage so that its cost is covered, or watch the margin on every new customer shrink as they use it more. The 10-Q points to both: AI costs rising with "increased usage of our platform by paid users," and the release's mention of "improvements in AI cost efficiency," including a rising share of work running on Figma's own post-trained model.

Retention and cash cooled while revenue beat​

Net dollar retention was 131% on September 30, the same as a year earlier but down from the 136% Figma reported for June. Paid customers with more than $10,000 of annual recurring revenue rose to 16,566 from 12,910, and those above $100,000 to 1,717 from 1,262.

Operating cash flow was $48.4 million and free cash flow $41.5 million, an 11% margin, against $49.0 million and 18% a year earlier: revenue grew $117.2 million while free cash flow fell. Cash, cash equivalents and marketable securities were $1.72 billion, including $70.3 million in the bitcoin exchange-traded fund. Deferred revenue was flat at $626.6 million against June, and remaining performance obligations were $677.5 million.

What to watch in the fourth quarter​

• The guide. Figma expects fourth-quarter revenue of $402 million to $404 million, 33% growth at the midpoint after 43% in the third quarter, and raised full-year revenue guidance by $33 million to $1.497 billion to $1.499 billion. Non-GAAP operating income is guided to $158 million to $163 million for the year.
• Gross margin. The fourth-quarter cost of revenue will show whether the shift to Figma's own model slows the hosting bill, or whether usage keeps growing faster than revenue.
• Credit pricing. If AI usage keeps outgrowing revenue, the margin needs either a higher price per credit or a lower cost per unit of work.
• Retention. A second quarter below 136% would say the June figure was the peak of the AI credit launch rather than the new level.