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Google Recasts Stitch as AI-First Design Canvas as Figma Slides 8%

Investors are weighing Google’s Workspace ties that could lower switching costs for design teams.

Overview

  • Google Labs introduced 'vibe designing' in Stitch, using natural language to generate polished UI layouts and front-end code without traditional wireframing.
  • The update adds voice-driven editing, an agent manager for exploring multiple ideas, new templates across sectors, MCP server export, and DESIGN.md project rules export.
  • Stitch now integrates with Google Docs, Drive, and the broader Workspace suite, positioning the tool inside workflows many enterprises already use.
  • Figma shares fell roughly 8% on Wednesday after the announcement and were still down about 5% by Thursday midday in New York, trading near $24.50 and roughly 80% below the post-IPO high of $142.92.
  • Figma reported $1.06 billion in 2025 revenue, up 41% year over year, with net losses widening to $1.25 billion and net dollar retention reaching 136%.