But the shock announcement saw the firm’s stock tumble, with investors seemingly punishing the firm for the high price tag.
Adobe vs Figma
It appears the sheer size of the deal led to investors downgrading Adobe’s stock to its lowest level in almost three years, MarketWatch reported.
The Figma deal isn’t the only problem Adobe currently faces. Despite achieving a record $4.43 billion revenue in its 2022 Q3 financial results, investors were disappointed with the company’s muted outlook for the next quarter.
But the company remains bullish about the acquisition.
“Adobe’s greatness has been rooted in our ability to create new categories and deliver cutting-edge technologies through organic innovation and inorganic acquisitions. The combination of Adobe and Figma is transformational and will accelerate our vision for collaborative creativity,” said chairman and CEO Shantanu Narayen.
Founded in 2012, Figma has gone on to become one of the top interface design tools in its field. Practicing what they preached, its developers made it easy to use (and, for now at least, it offers a free plan). Its cloud-powered, browser-based prototyping, built for collaborating online, proved popular with firmly digitally-minded UX professionals and students.
Indie software developer Nathan Manousos noted that Adobe’s acquisition “shows how hard it is to turn money into software. You'd think for $20B you could build something as good as Figma yourself, but you can't. Software is art.”
Adobe XD was the nearest the San Jose giant could get to a Figma alternative. But many found it less accessible, limited - it only runs on Windows and Mac - and less suited team collaboration. That it suffers from Adobe’s familiar complaint, lack of regular QoL updates, didn’t help endear it to users.
For a company of Adobe’s size, it’s far easier to just add Figma to its own stable of industry-standard video editing software and photo editors. With its collaboration-focused design, the leading design tool will fit neatly in the Creative Cloud ecosphere.
If you can’t beat them, buy them.
Whether that’s the right decision - for Adobe, Figma, and their users - is unclear.
The minds behind Sketch, UXPin, and mockup software rivals may look upon the merger with envy. And, perhaps, hide a smirk at Adobe’s falling stock.
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Steve is TechRadar Pro’s B2B Editor for Creative & Hardware. He explores the apps and devices for individuals and organizations that thrive on design and innovation. A former journalist at Web User magazine, he's covered software and hardware news, reviews, features, and guides. He's previously worked on content for Microsoft, Sony, and countless SaaS & product design firms. Once upon a time, he wrote commercials and movie trailers. Relentless champion of the Oxford comma.