Adobe Is Focused on AI Rather Than Figma With Acquisition in Limbo

(Bloomberg) -- Adobe Inc.’s proposed $20 billion acquisition of Figma was a cornerstone of the creative giant’s plan to become cool again.

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But more than a year after the deal for the digital-design startup was announced, it has stalled due to regulatory challenges, and the software company’s attention has moved on to the next big thing — artificial intelligence.

Adobe’s focus at its annual conference in Los Angeles this week was on new generative artificial intelligence features in signature products like Photoshop. There were no mentions of Figma during keynote speeches, and only one reference during an hourslong investor briefing. The design startup had no presence on the exhibition floor.

That’s a stark contrast from last year’s event, when Figma Chief Executive Officer Dylan Field joined Adobe’s main keynote presentation to talk about future product integrations and fist-bump Adobe Chief Strategy Officer Scott Belsky, an architect of the deal. Field also joined last year’s investor briefing, where the startup’s name was uttered 40 times.

“A lot has changed since Figma was announced — at that time there was a view that Adobe was running out of growth and needed something new,” said Michael Turrin, an analyst at Wells Fargo. With the excitement over Firefly, Adobe’s new suite of AI models, buying Figma “doesn’t feel as dire a need as it did two years ago.”

Adobe executives say they’re committed to closing the deal, and the silence is due to regulatory limbo. The US Department of Justice has made a second request for information from the companies and Bloomberg News reported in February that the department was preparing a lawsuit to block the deal. The European Union is in a “phase 2” review of the purchase and has been asking competitors whether the acquisition could concentrate pricing power. The UK’s competition watchdog also is reviewing the deal.