Jim Cramer Discusses Selling Figma to Support Palantir Stock Performance

This content does not constitute investment advice. The author does not hold any positions in the stocks referenced.

Figma’s Surprising IPO Performance

Figma captured attention last week as its initial public offering (IPO) skyrocketed by approximately 250% on debut. However, the recent excitement surrounding Figma appears to have waned, with market interest shifting towards Palantir, which is poised to announce its quarterly earnings following today’s trading session.

Understanding Figma’s Business Model

For those unfamiliar, Figma is a design software company based in San Francisco. It confidentially filed for an IPO in April 2025, a move that followed the collapse of a $20 billion acquisition deal with Adobe in December 2023, largely due to regulatory hurdles.

In their IPO announcement, Figma reported impressive revenue figures—$749 million for 2024, marking a 48% increase year-over-year, and $228 million in Q1 2025, up 46% from the same period the preceding year.

IPO Highlights and Market Impact

Priced at $33 per share, Figma’s IPO successfully raised over $1.2 billion, valuing the company at roughly $19.3 billion. Once trading commenced, the stock surged to $115.50, boosting the company’s market cap to nearly $70 billion.

Palantir’s Position in the Market

Contrastingly, Palantir is an AI-driven Software-as-a-Service (SaaS) organization that helps governments and businesses analyze massive volumes of data. Its two main platforms, Gotham and Foundry, serve the specific analytic needs of government and enterprise clients, respectively. Furthermore, Palantir’s proprietary Artificial Intelligence Platform (AIP) incorporates various Large Language Models (LLMs) and generative AI technologies to enhance organizational operations.

Gotta sell your Figma to prop up your Palantir, right??

— Jim Cramer (@jimcramer) August 4, 2025

Market Dynamics and Investor Sentiment

Following last week’s rally, Figma’s shares are experiencing a decline, currently down about 20% in early trading. Conversely, Palantir’s shares have seen a modest increase of around 3% as anticipation builds for its quarterly earnings announcement.

Jim Cramer, known for his insights within the retail investor community, suggested that some investors may be selling off portions of their Figma gains to bolster their Palantir holdings ahead of the earnings release. This perspective reflects a potential overlap in investment strategies, especially considering the similarities in the AI-driven SaaS models of both firms.

Looking Ahead: Palantir’s Earnings Expectations

For Palantir, delivering strong results is critical to sustain its market momentum, particularly given its premium valuation. According to a Bloomberg analysis, Figma’s price-to-sales (P/S) ratio stood at an impressive 56.7x as of August 1, while Palantir’s reached an astonishing 87.1x.

Investors will likely focus on Palantir’s contract flow in today’s earnings report, especially after the U. S.Army streamlined its contracts with the company into a single agreement, potentially worth up to $10 billion over the next decade.

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