It was supposed to be the biggest software acquisition in history. Adobe, the creative giant that basically owns your desktop, was going to shell out $20 billion to buy Figma, the scrappy web-based darling of the design world. Then, it just... stopped.
If you spent any time on Design Twitter or in Slack channels back in late 2022, the Adobe acquisition of Figma details felt like a looming shadow. People were panicked. Designers who moved from Adobe XD to Figma felt like they were being forced back into the arms of an ex they’d worked hard to leave. But by December 2023, the whole thing evaporated into a cloud of regulatory filings and a billion-dollar breakup fee.
The $20 Billion Math That Scared the Regulators
Let’s be real for a second. $20 billion is an insane amount of money for a company that was doing around $400 million in annual recurring revenue at the time of the announcement. Adobe was paying a 50x multiple. Why? Because Figma wasn’t just a competitor; it was an existential threat.
The Adobe acquisition of Figma details revealed a lot about how Adobe viewed the future of the web. Figma had cracked the code on multiplayer collaboration in a way Adobe simply couldn't replicate with Creative Cloud. While Photoshop and Illustrator were heavy, local-first applications, Figma lived in the browser. It was fast. It was social. Most importantly, it was winning over the next generation of developers and product managers, not just the "creatives."
Adobe CEO Shantanu Narayen and Figma CEO Dylan Field pitched this as "jointly reimagining the future of creativity." Regulators in the UK, EU, and US saw it differently. They saw a "killer acquisition." The UK’s Competition and Markets Authority (CMA) was particularly aggressive. They argued that because Figma was already a dominant force in interactive product design, and Adobe was its only real rival with XD, merging them would basically eliminate competition.
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Why the Deal Collapsed Under Its Own Weight
Regulators didn't just worry about the software we use today. They worried about what Adobe might have done to Figma to protect its own high-margin products. Honestly, can you blame them? The tech industry has a long history of "buy it and kill it."
Adobe tried to play ball. They offered concessions. They suggested they wouldn't bundle Figma into the Creative Cloud immediately. But the CMA and the European Commission weren't having it. They demanded "structural remedies." In plain English? They wanted Adobe to sell off parts of the business—like Adobe XD—to ensure competition stayed alive.
Adobe looked at the math and the legal bills and decided it wasn't worth the fight. On December 18, 2023, they called it quits.
The Billion Dollar Goodbye
The most shocking part of the Adobe acquisition of Figma details was the termination fee. Because the deal failed to clear regulatory hurdles, Adobe had to pay Figma $1 cash. Just for walking away. Imagine failing at a $20 billion purchase and having to write a check for a billion dollars as a "sorry."
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For Figma, this was actually a massive win. They kept their independence, they kept their product, and they got a massive cash infusion that basically funded their R&D for the next several years. Dylan Field stayed in the driver's seat. The design community breathed a collective sigh of relief.
What This Means for Your Workflow in 2026
We are now living in the aftermath. If the deal had gone through, Figma might have become "Adobe Figma," likely tied to a complex Creative Cloud subscription. Instead, Figma is doubling down on its own ecosystem.
Since the deal collapsed, we’ve seen Figma launch "Dev Mode" and lean heavily into AI with "Figma AI" (though that had its own rocky start with the Make-it-Real controversy). They are no longer just a design tool; they are trying to own the entire product development lifecycle from brainstorming to code.
Adobe, on the other hand, had to pivot fast. They effectively mothballed Adobe XD. If you look at the Adobe acquisition of Figma details from a product standpoint, Adobe essentially admitted defeat in the UI/UX space. Now, they are putting all their chips on Firefly and generative AI integration across Photoshop and Premiere Pro. They want to be the engine behind the assets, even if Figma is the canvas where those assets are placed.
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Realities of the Current Design Market
The market has shifted. We aren't in the era of "growth at all costs" anymore. Investors want to see profitability.
- Figma is still the king of collaboration. No one has caught up to their browser-based performance yet.
- Adobe is still the king of high-fidelity imaging. If you need to manipulate pixels or edit 8K video, you aren't doing it in Figma.
- The "Middle Ground" is a warzone. Tools like Framer, Penpot, and Canva are rushing into the space that the failed merger left wide open.
There’s a bit of irony here. By trying to buy Figma, Adobe proved how valuable the "open web" approach to design is. By failing to buy it, they’ve ensured that the design world stays fragmented and competitive. That’s actually great for us as users. Competition keeps prices down and innovation high.
Actionable Steps for Design Teams
If you were waiting for the merger to simplify your tech stack, stop waiting. It’s not happening. Here is how you should navigate the post-merger world:
- Audit your subscriptions. Don't assume Figma will eventually be "free" with your Adobe license. It’s a separate, premium expense for the foreseeable future. Treat it as its own budget line item.
- Invest in Design Systems, not just tools. The Adobe acquisition of Figma details showed that the tool itself matters less than the workflow. If your design system is robust, moving between tools (or surviving tool changes) is much easier.
- Explore Penpot if you’re worried about "The Big Guys." If you want a truly independent, open-source alternative that mirrors Figma’s features, Penpot has gained massive traction since the Adobe/Figma drama. It uses SVG and CSS as its native format, which is a dream for developers.
- Watch the AI integrations. Both companies are fighting a new war now: who can automate the tedious parts of design faster? Keep an eye on Figma’s "Slides" and Adobe’s "Firefly" to see which one actually saves your team time versus just creating more digital noise.
The death of this deal was a landmark moment in tech history. It signaled that the era of "unlimited consolidation" might finally be over. Figma remains the independent powerhouse of the web, and Adobe remains the titan of creative software. They are rivals again, and honestly, the industry is much better off for it.