Q3 2025 Earnings Presentation November 5, 2025 © 2025 Freshworks Inc. All rights reserved. Disclaimer This presentation has been prepared by Freshworks Inc. ("Freshworks") for informational purposes only and not for any other purpose. Nothing contained in this presentation is, or should be construed as, a recommendation, promise, or representation by Freshworks or any officer, director, employee, agent, or advisor of Freshworks. This presentation does not purport to be all inclusive or to contain all of the ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Delaware 2950 S Delaware Street, Suite 201 33-1218825 (I.R.S. Employer Identification No.) (State or other jurisdiction of incorporation or organization) San Mateo, CA ...

Revenue Performance - Total revenue for Q3 2025 was $215.1 million, a 15% increase from $186.6 million in Q3 2024[6] - Freshworks reported Q3 2025 revenue of $215,118,000, a 15% increase from $186,575,000 in Q3 2024[27] - For Q4 2025, revenue is expected to be between $217.0 million and $220.0 million, reflecting a year-over-year growth of 12% to 13%[9] - Full year 2025 revenue guidance is raised to between $833.1 million and $836.1 million, indicating a 16% year-over-year growth[9] Profitability Metrics - Non-GAAP income from operations was $45.2 million, with a non-GAAP operating margin of 21.0%, compared to $24.0 million and 12.8% in Q3 2024[6] - Gross profit for Q3 2025 was $182,163,000, compared to $156,769,000 in Q3 2024, reflecting a gross margin improvement[27] - Non-GAAP net income for Q3 2025 was $46,776, compared to $33,573 in Q3 2024, representing a 39.2% increase[34] - GAAP gross margin for Q3 2025 was 84.7%, slightly up from 84.0% in Q3 2024[33] - Non-GAAP operating margin for Q3 2025 was 21.0%, compared to 12.8% in Q3 2024, showing a significant improvement[34] Cash Flow and Operating Activities - Net cash provided by operating activities was $63.5 million, representing an operating cash flow margin of 29.5%, up from $42.3 million and 22.7% in Q3 2024[6] - The company reported a net cash provided by operating activities of $63,472,000 for Q3 2025, up from $42,329,000 in Q3 2024[31] - Adjusted free cash flow was $57.2 million, with an adjusted free cash flow margin of 26.6%, compared to $40.1 million and 21.5% in Q3 2024[6] - Adjusted free cash flow for Q3 2025 was $57,209, compared to $40,105 in Q3 2024, marking a 42.6% increase[35] - Net cash provided by operating activities for the nine months ended September 30, 2025, was $180,036, up from $119,284 in the same period of 2024, a 51.0% increase[35] Customer Metrics - The number of customers contributing more than $5,000 in ARR increased by 9% year-over-year to 24,377[11] - The net dollar retention rate was 105%, slightly down from 107% in Q3 2024[11] Cost Management - Operating expenses totaled $189,620,000 in Q3 2025, down from $195,633,000 in Q3 2024, indicating cost management efforts[27] - Stock-based compensation expense for Q3 2025 was $48,529,000, down from $58,709,000 in Q3 2024[32] Asset and Liability Overview - Cash and cash equivalents decreased to $420,934,000 as of September 30, 2025, from $620,315,000 at the end of 2024[29] - Total assets decreased to $1,371,959,000 as of September 30, 2025, down from $1,611,884,000 at the end of 2024[29] - Deferred revenue increased to $348,001,000 as of September 30, 2025, compared to $323,435,000 at the end of 2024, indicating strong future revenue potential[29] Management Changes - The company appointed Enrique Ortegon as Senior Vice President and General Manager of Americas Field Sales[11] Currency Impact - Freshworks' revenue adjusted for constant currency also showed a 15% growth, indicating stable performance despite currency fluctuations[32]

Core Insights - Freshworks Inc. has launched Freshservice for Business Teams as a standalone product, allowing non-IT departments to enhance service delivery without needing an existing IT Service Management (ITSM) implementation [1] - The product has seen significant growth, doubling its annual recurring revenue to over $35 million as of September 30, 2025, with one in four eligible ITSM customers utilizing it [2] Product Features and Benefits - Freshservice for Business Teams enables non-IT functions to utilize AI for automating processes, improving efficiency, and enhancing ticket resolution [4] - The solution connects fragmented tools and workflows, allowing organizations to scale service delivery efficiently across various departments [5] - Prebuilt workflows and templates simplify complex HR processes like onboarding and offboarding, facilitating faster adoption [6] - The platform offers an intuitive user interface and no-code automation, making it accessible for teams without technical resources [7] - It provides a cost-effective alternative to traditional IT suites, focusing on rapid deployment and low total cost of ownership [8] Market Demand and Trends - There is a growing demand for solutions that improve employee experiences and streamline processes across multiple departments without extensive customization [9]

Core Insights - Freshworks Inc. reported strong financial results for Q3 2025, exceeding previous estimates in growth and profitability metrics, driven by the integration of AI into their software solutions [2][6]. Financial Summary - Total revenue for Q3 2025 was $215.1 million, a 15% increase from $186.6 million in Q3 2024, with the same growth rate when adjusted for constant currency [6]. - GAAP loss from operations was $(7.5) million, improving from $(38.9) million in Q3 2024, resulting in an operating margin of (3.5)% compared to (20.8)% [6]. - Non-GAAP income from operations was $45.2 million, with a non-GAAP operating margin of 21.0%, up from $24.0 million and 12.8% in Q3 2024 [6]. - GAAP net loss per share was $(0.02) based on 286.2 million weighted-average shares outstanding, compared to $(0.10) based on 302.1 million shares in Q3 2024 [6]. - Non-GAAP diluted net income per share was $0.16, compared to $0.11 in Q3 2024 [6]. - Net cash provided by operating activities was $63.5 million, representing a margin of 29.5%, up from $42.3 million and 22.7% in Q3 2024 [6]. - Adjusted free cash flow was $57.2 million, with a margin of 26.6%, compared to $40.1 million and 21.5% in Q3 2024 [6]. Customer Metrics - The number of customers contributing more than $5,000 in ARR reached 24,377, a 9% year-over-year increase [7]. - The net dollar retention rate was 105%, slightly down from 107% in Q3 2024 [7]. Business Highlights - Freshworks onboarded several new customers, including AllSaints/John Varvatos and Société Générale, expanding its market presence [7]. - The company appointed Enrique Ortegon as Senior Vice President and General Manager of Americas Field Sales [14]. Financial Outlook - For Q4 2025, Freshworks expects revenue between $217.0 million and $220.0 million, with year-over-year growth of 12% to 13% [9]. - The full-year revenue forecast is between $833.1 million and $836.1 million, reflecting a 16% growth [9].

Core Viewpoint - Freshworks Inc. is expected to report a year-over-year increase in earnings and revenues for the quarter ended September 2025, with a consensus outlook indicating potential stock price movement based on actual results compared to estimates [1][2]. Earnings Expectations - The upcoming earnings report is anticipated to be released on November 5, with expected earnings of $0.13 per share, reflecting an 18.2% increase year-over-year, and revenues projected at $208.62 million, up 11.8% from the previous year [3][2]. Estimate Revisions - The consensus EPS estimate has been revised down by 11.11% over the last 30 days, indicating a reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate matches the Zacks Consensus Estimate, resulting in an Earnings ESP of 0%, which complicates predictions of an earnings beat [12]. Historical Performance - Freshworks has a history of beating consensus EPS estimates, having done so in the last four quarters, including a notable surprise of +50.00% in the last reported quarter [13][14]. Zacks Rank - The stock currently holds a Zacks Rank of 1 (Strong Buy), which typically increases the likelihood of a positive earnings surprise, although the lack of a positive Earnings ESP reading makes predictions uncertain [12][10].

Core Thesis - Freshworks Inc. presents a compelling growth story despite recent volatility, with a clear path toward profitability and strong fundamentals [2][5] Financial Performance - As of October 8th, Freshworks' share was trading at $11.18, with a forward P/E of 17.15 [1] - Non-GAAP operating income more than tripled year-over-year in Q2 2025, while GAAP operating losses shrank by 80% [2] - The company holds $926 million in cash and equivalents, forecasting GAAP profitability by 2026 [2] Analyst Sentiment - Analysts maintain a consensus "Buy" rating, with 12-month price targets ranging from $20.07 to $23.25, and some targets reaching $27.00 [3] - A key growth driver is the Freddy AI platform, generating over $20 million in ARR from more than 5,000 paying customers [3] Market Challenges - The stock recently dropped over 10% due to downgrades from major institutions, including a $13.00 price target from Wells Fargo [4] - Q2 2025 revenue grew 18% year-over-year, but full-year guidance projects a deceleration to 14–15% growth, contributing to near-term uncertainty [4] Investment Opportunity - Despite short-term pressures, the recent correction may represent an attractive entry point for investors, with accelerating profitability and successful enterprise expansion [5]

Core Viewpoint - Freshworks Inc. is set to announce its financial results for the third quarter of 2025 on November 5, 2025, with a live audio webcast to discuss the results and business highlights [1][2]. Group 1: Financial Results Announcement - The financial results for the third quarter ended September 30, 2025, will be announced after market close on November 5, 2025 [1]. - A live audio webcast will take place at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time on the same day [2]. - The webcast will be accessible via Freshworks' investor relations website, and a replay will also be available [2]. Group 2: Company Overview - Freshworks Inc. specializes in uncomplicated service software aimed at enhancing customer and employee experiences [3]. - The company offers enterprise-grade solutions that are powerful yet user-friendly, designed to deliver quick results [3]. - Over 74,000 companies, including notable names like Bridgestone, New Balance, Nucor, S&P Global, and Sony Music, utilize Freshworks' customer experience (CX) and employee experience (EX) software [3].

Core Insights - The information technology sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1] - The Relative Strength Index (RSI) is a key indicator for identifying oversold conditions, with values below 30 indicating potential buying opportunities [1] Company Summaries - **Freshworks Inc (NASDAQ:FRSH)**: - Recently appointed Enrique Ortegon as senior vice president and general manager of Americas Field Sales, expected to drive growth [8] - Stock has decreased approximately 15% over the past month, with a 52-week low of $10.81 [8] - Current RSI value is 29.7, with shares closing at $11.18, reflecting a 1.2% decline [8] - **PAR Technology Corp (NYSE:PAR)**: - Analyst Mark Palmer maintained a Buy rating but reduced the price target from $92 to $77 [8] - Stock has fallen around 21% in the last month, reaching a 52-week low of $37.29 [8] - Current RSI value is 23.4, with shares closing at $37.96, showing a slight increase of 0.2% [8] - **Rapid7 Inc (NASDAQ:RPD)**: - Analyst Erin Wilson maintained an Equal-Weight rating and lowered the price target from $28 to $22 [8] - Stock has decreased about 14% over the past month, with a 52-week low of $17.76 [8] - Current RSI value is 26.3, with shares closing at $17.77, reflecting a 4.5% decline [8]

Core Insights - The information technology sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1] - The Relative Strength Index (RSI) is a key indicator for identifying oversold conditions, with values below 30 indicating potential buying opportunities [1] Company Summaries - **Freshworks Inc (NASDAQ:FRSH)**: - Recently appointed Enrique Ortegon as senior vice president and general manager of Americas Field Sales, expected to drive growth [8] - Stock has decreased approximately 15% over the past month, with a 52-week low of $10.81 [8] - Current RSI value is 29.7, with shares closing at $11.18, reflecting a 1.2% decline [8] - **PAR Technology Corp (NYSE:PAR)**: - Analyst Mark Palmer maintained a Buy rating but reduced the price target from $92 to $77 [8] - Stock has fallen around 21% in the last month, reaching a 52-week low of $37.29 [8] - Current RSI value is 23.4, with shares closing at $37.96, showing a slight increase of 0.2% [8] - **Rapid7 Inc (NASDAQ:RPD)**: - Morgan Stanley analyst Erin Wilson maintained an Equal-Weight rating and lowered the price target from $28 to $22 [8] - Stock has decreased about 14% over the past month, with a 52-week low of $17.76 [8] - Current RSI value is 26.3, with shares closing at $17.77, reflecting a 4.5% decline [8]