Figma's Rapid Growth vs. Adobe's Stability
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2h ago
0mins
Source: NASDAQ.COM
- Revenue Growth Comparison: Figma's annual revenue reaches $1 billion with a growth rate of 38%, nearly 3.5 times Adobe's 11% growth, indicating Figma's strong potential in a rapidly expanding market, attracting growth investors' interest.
- Profitability Differences: Despite Figma's rapid revenue growth, it incurs a net loss of $900 million, while Adobe achieves a net income of $7.1 billion, highlighting Adobe's robust profitability as a mature company, making it more appealing to value investors.
- Cash Flow Status: Adobe's free cash flow stands at $9.9 billion, significantly exceeding Figma's $300 million, showcasing Adobe's strong cash flow performance that provides greater resilience against market fluctuations, attracting conservative investors.
- Market Positioning Differences: Figma's browser-based design tool, favored by startups and tech companies for real-time collaboration, contrasts with Adobe's established Creative Cloud product suite, reflecting significant strategic differences in their market approaches.
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Analyst Views on ADBE
Wall Street analysts forecast ADBE stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for ADBE is 454.52 USD with a low forecast of 310.00 USD and a high forecast of 660.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
24 Analyst Rating
17 Buy
6 Hold
1 Sell
Moderate Buy
Current: 291.650
Low
310.00
Averages
454.52
High
660.00
Current: 291.650
Low
310.00
Averages
454.52
High
660.00
About ADBE
Adobe Inc. is a global technology company. The Company's products, services and solutions are used around the world to imagine, create, manage, deliver, measure, optimize and engage with content across surfaces and fuel digital experiences. Its segments include Digital Media, Digital Experience, and Publishing and Advertising. The Digital Media segment is centered around Adobe Creative Cloud and Adobe Document Cloud, which include Adobe Express, Adobe Firefly, Photoshop and other products, offering a variety of tools for creative professionals, communicators and other consumers. The Digital Experience segment provides an integrated platform and set of products, services and solutions through Adobe Experience Cloud. The Publishing and Advertising segment contains legacy products and services. In addition, its Adobe GenStudio solution allows businesses to simplify their content supply chain process with generative artificial intelligence (AI) capabilities and intelligent automation.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Figma's Rapid Growth vs. Adobe's Stability
- Revenue Growth Comparison: Figma's annual revenue reaches $1 billion with a growth rate of 38%, nearly 3.5 times Adobe's 11% growth, indicating Figma's strong potential in a rapidly expanding market, attracting growth investors' interest.
- Profitability Differences: Despite Figma's rapid revenue growth, it incurs a net loss of $900 million, while Adobe achieves a net income of $7.1 billion, highlighting Adobe's robust profitability as a mature company, making it more appealing to value investors.
- Cash Flow Status: Adobe's free cash flow stands at $9.9 billion, significantly exceeding Figma's $300 million, showcasing Adobe's strong cash flow performance that provides greater resilience against market fluctuations, attracting conservative investors.
- Market Positioning Differences: Figma's browser-based design tool, favored by startups and tech companies for real-time collaboration, contrasts with Adobe's established Creative Cloud product suite, reflecting significant strategic differences in their market approaches.
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Investment Comparison: Adobe vs. Figma
- Market Performance Comparison: Adobe boasts a market cap of $120 billion with $23.8 billion in annual revenue and $7.1 billion in net income, showcasing its strong profitability as a creative software giant; in contrast, Figma has a market cap of $13 billion and only $1 billion in annual revenue, despite a 38% revenue growth rate, indicating a high-risk investment profile.
- Product Positioning Differences: Adobe primarily offers a suite of creative tools through its Creative Cloud, covering graphic design, video editing, and more, while Figma focuses on a browser-based design tool for real-time collaboration, attracting design teams from startups and tech companies, highlighting their distinct strategic positions in the market.
- Acquisition Impact Analysis: Adobe's failed attempt to acquire Figma for $20 billion due to antitrust concerns resulted in a $1 billion breakup fee, which provided crucial support for Figma's operations, allowing it to gain a larger market share in the competitive landscape.
- Investor Choice Considerations: While Figma's revenue growth is nearly four times that of Adobe, it continues to burn cash and has seen its stock price plummet since its IPO; conversely, Adobe, as a profitable market leader, appeals to value investors, whereas Figma attracts those seeking high-risk, high-reward opportunities.
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