Core Viewpoint - Freshworks has authorized a $400 million share repurchase program while facing challenges related to its business model transition towards AI-driven pricing, raising questions about the effectiveness of the buyback in the context of potential revenue growth deceleration and analyst confidence decline [1][2][8]. Financial Performance - Freshworks reported $844 million in cash and generated $223 million in adjusted free cash flow for the year 2025 [1][6]. - The stock trades at a trailing P/E of 13x and a price-to-sales ratio of 2.7x, with a consensus analyst target of $12.57, indicating potential upside despite recent target cuts from $17.62 to $12.62 following disappointing EPS guidance [1][10]. Revenue Growth and Projections - Revenue growth is projected to decelerate from 20% in Q2 2024 to a range of 13.5% to 14.5% for 2026, with concerns about the company's ability to transition its customer base effectively [2][8]. - The company's AI product, Freddy, is expected to reach an annual recurring revenue (ARR) of $25 million by Q4 2025, with a long-term target of $100 million in AI-driven ARR [9]. Insider Activity - CEO Dennis Woodside has been actively purchasing shares, acquiring 301,100 shares in total, indicating confidence in the company's future [1][7]. - The fully diluted share count has decreased by 6% year-over-year, suggesting that the buyback program is having a positive impact [7]. Market Sentiment and Analyst Reactions - Following the announcement of the buyback, the stock initially rose by 15.9% but subsequently lost most of those gains, reflecting investor uncertainty [5]. - Analysts have expressed concerns regarding the shift from per-seat pricing to outcome-based pricing, with some funds exiting their positions due to these concerns [9].

Core Insights - Freshworks CEO Dennis Woodside emphasized the company's ambition by stating, "We're not the incumbent that has a lot to lose" during the Q4 2025 earnings call, indicating a strategic positioning against established competitors [1] Company Summary - Freshworks is positioning itself as a challenger in the market, suggesting a focus on growth and innovation rather than being constrained by legacy systems or market share concerns [1]

Core Insights - Freshworks Inc. (NASDAQ:FRSH) is recognized as a promising investment opportunity by hedge funds, despite being relatively under-the-radar [1] Financial Performance - Freshworks reported Q4 results that exceeded market expectations, with non-GAAP earnings per share of $0.14, surpassing the consensus estimate of $0.12 [2] - The company's Freddy AI annual recurring revenue reached $25 million in Q4, an increase from $20 million in the previous quarter [2] Analyst Ratings and Price Targets - Citizens lowered its price target for Freshworks from $27 to $16 while maintaining a Market Outperform rating [2] - Oppenheimer reduced its price target from $18 to $15 but kept an Outperform rating, citing strong momentum in the EX business and AI products [3] - Oppenheimer's price target reduction was attributed to lower peer group multiples, despite noting steady revenue growth, profit margins, and cash generation [4] Business Overview - Freshworks provides enterprise-grade, AI-assisted business software solutions aimed at enhancing customer and employee experiences [4]

Core Viewpoint - Freshworks Inc. has announced leadership changes aimed at accelerating growth and enhancing customer value by unifying its global sales organization under Ian Tickle, who has been appointed as Chief Revenue Officer [1][2]. Leadership Changes - Ian Tickle, previously Chief of Global Field Operations, will now oversee all sales, customer success, and customer experience functions as Chief Revenue Officer [2][3]. - The decision to unify the sales organization is expected to drive high-impact results, as Tickle has a proven track record of performance at Freshworks [2]. Financial Performance - Freshworks reported achieving profitability and record free cash flow generation in its Q4 and full year 2025 financial results, and it has raised revenue estimates for fiscal year 2026 [4]. - The company is reaffirming its financial estimates for Q1 ending March 31, 2026, and the full fiscal year ending December 31, 2026, as previously communicated [4]. Company Overview - Freshworks Inc. specializes in uncomplicated service software that enhances employee and customer experiences, with a focus on a people-first approach to AI [5]. - The company serves nearly 75,000 clients, including notable brands like Bridgestone, New Balance, S&P Global, and Sony Music [5].

Core Insights - Freshworks is addressing key challenges in IT service management for customers, particularly as it expands into the mid-market and enterprise sectors [1] Group 1 - Freshworks is focused on solving significant problems for its customers, which is a critical factor in its growth strategy [1] - The company is experiencing increased interest from mid-market and enterprise clients, indicating a shift in its target market [1]

Freshworks Conference Call Summary Company Overview - **Company**: Freshworks (NasdaqGS:FRSH) - **Industry**: IT Service Management (ITSM) and Employee Experience (EX) Software Key Points and Arguments Business Transformation and Market Focus - Freshworks has transformed into a predominantly EX business, targeting mid-market and lower-end enterprise companies with complex IT needs [9][10] - The company serves clients like New Balance and Nucor Steel Dynamics, focusing on providing nimble solutions for companies with smaller IT teams and budget constraints [9][10] - Freshworks' EX business crossed over $510 million in ARR, growing at approximately 32% year-over-year [15] AI Integration and Growth - AI is a significant growth driver, with 8,000 out of 75,000 customers currently using AI products, contributing to $25 million in ARR, nearly doubling year-over-year [11][13] - The company emphasizes the importance of AI in enhancing productivity for support agents and managers [11][13] Customer Support and CX Business - Freshdesk, the customer support product, generates over $400 million in ARR, with an 8% growth last quarter [13] - The transition to Freshdesk Omni aims to unify customer interactions and improve upgrade processes, with 40,000 customers expected to migrate by the end of April [14][93] Competitive Landscape - Freshworks positions itself against larger incumbents like ServiceNow and fragmented legacy players, claiming to offer the fastest time to value and the lowest total cost for mid-market customers [16][17] - The company believes that its comprehensive solution, which integrates ITSM, asset management, and operations management, is superior for mid-market clients [17][18] AI and Market Dynamics - Concerns about AI disrupting the SaaS landscape are acknowledged, but Freshworks believes its extensive data repository and established customer base provide a competitive edge [20][21] - The company is adapting its monetization strategies, exploring consumption-based models and token pricing for AI products [38][80] Customer Insights and Headcount Management - Customers are balancing AI investments with hiring plans, with some opting to reduce staff while others aim to transform support teams into revenue centers [35][36] - The Net Dollar Retention (NDR) for customers using Copilot is 116%, indicating that AI adoption leads to business expansion [30] Upmarket Expansion and Go-to-Market Strategy - Freshworks is focusing on larger accounts, with a 28% growth in accounts over 50,000 and a strong pipeline for deals over $100,000 [51][56] - The company has invested in building a go-to-market team to pursue larger deals, hiring leaders from major competitors [55][56] Device42 and Asset Management - Device42 has reached over $40 million in ARR and is integral to winning larger deals by providing asset management and relationship mapping capabilities [59][60] - The integration of Device42 enhances the overall IT management solution offered to customers [60] Freshservice for Business Teams - Freshservice for Business Teams has crossed $40 million in ARR and is growing rapidly, targeting departments outside of IT [70][71] - This product serves as a pathway to broader ITSM adoption by demonstrating value to other departments [71] Future Outlook and Risks - Freshworks aims to reach $100 million in ARR for its AI products, with ongoing innovation and customer adoption being critical [76][80] - The company is focused on how AI can evolve to address more complex problems and enhance decision-making for customers [120] Financial Performance - Freshworks achieved a 27% free cash margin last year and aims for consistent GAAP profitability in the second half of this year [108][110] - The company has a strong cash position with over $700 million on the balance sheet and has initiated a $400 million buyback [110] Conclusion Freshworks is strategically positioned to capitalize on the growing demand for ITSM and EX solutions, leveraging AI to enhance its offerings and drive growth. The company is focused on expanding its market presence, particularly in the mid-market segment, while navigating competitive pressures and evolving customer needs.

Freshworks 2026 Conference Summary Company Overview - **Company**: Freshworks (NasdaqGS:FRSH) - **CFO and COO**: Tyler, who joined Freshworks in 2020 and previously worked at Zuora for 10 years [1][4] Key Financial Performance - **Revenue Growth**: Achieved 13% constant currency growth last year, with a forecasted increase to 14% for the current year [25] - **Operating Profit**: Projected to generate $250 million in free cash flow this year, with a strong margin profile [25][38] - **Annual Recurring Revenue (ARR)**: EX products are growing over 20%, now exceeding $500 million in ARR [26] Strategic Developments - **Acquisition**: Recently acquired FireHydrant to enhance IT Operations Management (ITOM) capabilities, complementing existing products [26][29] - **Product Portfolio**: Freshworks has a four-pillar strategy including IT Service Management (ITSM), Employee Service Management (ESM), IT Asset Management (ITAM), and ITOM [31][32] AI Integration and Market Position - **AI Capabilities**: Freshworks has developed strong AI products, including AI Agent and Copilot, which are integral to their offerings [53][56] - **Customer Adoption**: Over 8,000 customers are using AI products, with a 50% attach rate on deals over $30,000 [58][199] - **Net Dollar Retention**: Corporate level net dollar retention is approximately 105%, with higher retention rates for customers using AI products [58][73] Market Challenges and Opportunities - **AI Perception**: Concerns exist that AI may negatively impact the business; however, Freshworks asserts that AI is enhancing their offerings and driving growth [49][50] - **Customer Base**: The majority of customers are in the mid-market and low enterprise sectors, with a focus on manufacturing, law firms, and sports teams [109][110] - **Long Tail Strategy**: Freshworks is shifting focus away from small and medium-sized businesses (SMBs) to larger clients, which has resulted in a decrease in customer count [90][91] Financial Strategy - **Share Buyback**: Announced a $400 million buyback, following a previous buyback of the same amount [38] - **Cash Position**: Maintains over $800 million in cash with no debt, positioning the company favorably for growth and investment [38] Future Outlook - **Growth Strategy**: Freshworks aims to engage existing customers to increase AI adoption and expand product usage [199] - **Pricing and Packaging**: The company is cautious in adjusting pricing structures, focusing on usage and customer feedback [83] Conclusion Freshworks is positioned for continued growth with a strong financial outlook, innovative AI capabilities, and a strategic focus on larger enterprise clients. The company is actively working to enhance its product offerings and customer engagement while navigating market challenges related to AI perceptions.

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-40806 __________________________________________ Freshworks Inc. __________________________________________ FORM 10-K _______ ...

Core Viewpoint - Freshworks Inc. has authorized a stock repurchase program of up to $400 million for its Class A common stock, reflecting confidence in its long-term strategy and growth potential [1][2]. Financial Performance - The company achieved GAAP profitability in 2025, generating over $223 million in free cash flow and $0.76 per weighted average diluted share, both nearly tripling from 2023 [2]. Share Repurchase Program - The repurchase program aims to buy back shares that the company believes are undervalued while maintaining sufficient cash for future growth investments [2]. - Freshworks may conduct repurchases through various means, including open market transactions and privately negotiated deals, in compliance with the Securities Exchange Act of 1934 [2]. Company Overview - Freshworks Inc. specializes in uncomplicated service software that enhances employee and customer experiences, with nearly 75,000 companies relying on its solutions [3].

Core Insights - Freshworks Inc. (NASDAQ:FRSH) is recognized as one of the 12 best beaten-down technology stocks to buy according to Wall Street analysts [1] - More than 60% of covering analysts remain bullish on Freshworks, predicting a 62.60% upside with a consensus price target of $12.00, indicating strong analyst sentiment and a positive outlook for the end of 2025 [2][8] Financial Performance - In Q4 2025, Freshworks reported total revenue of $222.7 million, a 14% year-over-year increase, with non-GAAP operating income of $41.6 million and an 18.7% margin [3] - For the entire year 2025, revenue increased by 16% to $838.8 million, with non-GAAP net income per share rising to $0.66 from $0.43 in 2024, and adjusted free cash flow reaching $223.1 million with a 26.6% margin [4] Growth and Product Development - Freshworks continues to expand its AI-driven product line with acquisitions like FireHydrant and new features in Freshservice, Freshdesk, and Freddy AI, which surpassed $25 million in annual recurring revenue [5] - The company anticipates non-GAAP net income per share for 2026 to be between $0.55 and $0.57, with projected revenue of $952 to $960 million [5] Company Overview - Freshworks Inc. simplifies employee and customer experiences through its SaaS software offerings, including Freshdesk, Freshservice, Freshsales, Freshmarketer, and Freshteam, and was established in 2010 with headquarters in San Mateo, California [6]