Registrant Information [Filing Details](index=1&type=section&id=Filing%20Details) Freshworks Inc., an accelerated filer, filed its Form 10-Q for the quarter ended June 30, 2025, having submitted all required electronic reports - Freshworks Inc. is classified as an **accelerated filer**[4](index=4&type=chunk) - The registrant has filed all required reports and submitted Interactive Data Files electronically during the preceding 12 months[3](index=3&type=chunk) [Securities Information](index=2&type=section&id=Securities%20Information) As of July 24, 2025, Freshworks Inc. had **237.9 million** Class A and **53.5 million** Class B common stock shares outstanding | Metric | Value | | :----- | :---- | | Class A common stock outstanding (July 24, 2025) | 237,933,261 shares | | Class B common stock outstanding (July 24, 2025) | 53,495,414 shares | Special Note Regarding Forward-Looking Statements [Nature of Forward-Looking Statements](index=4&type=section&id=Nature%20of%20Forward-Looking%20Statements) This section clarifies that the report contains forward-looking statements subject to substantial risks and uncertainties - All statements other than historical facts in this report are forward-looking statements, involving substantial risks and uncertainties[9](index=9&type=chunk) - Investors should not rely on forward-looking statements as predictions of future events, as actual results could differ materially[10](index=10&type=chunk)[12](index=12&type=chunk) [Key Areas of Forward-Looking Statements](index=4&type=section&id=Key%20Areas%20of%20Forward-Looking%20Statements) Forward-looking statements cover various aspects of the business, including ARR, revenue, expenses, profitability, and market opportunity - Forward-looking statements include expectations regarding ARR, revenue, expenses, profitability, customer acquisition and retention, usage of existing products, and the ability to manage growth[11](index=11&type=chunk) - Other key areas include future investments, capital requirements, sales and marketing efforts, addressable market opportunity, reliance on key personnel, international expansion, integration of acquired businesses (like D42 Parent, Inc.), and the effects of macroeconomic uncertainties[11](index=11&type=chunk) [Limitations and Disclaimers](index=5&type=section&id=Limitations%20and%20Disclaimers) The company's beliefs are based on available information, and Freshworks undertakes no obligation to update forward-looking statements - Statements reflecting beliefs and opinions are based on information available as of the report date, which may be limited or incomplete[13](index=13&type=chunk) - The company undertakes no obligation to update forward-looking statements to reflect events or circumstances after the report date, except as required by law[14](index=14&type=chunk) [Where You Can Find More Information](index=5&type=section&id=Where%20You%20Can%20Find%20More%20Information) Freshworks disseminates material information through SEC filings, press releases, its website, and social media channels - Material information is disseminated through SEC filings, press releases, public conference calls, the company website, investor relations section, LinkedIn, and X (formerly Twitter)[15](index=15&type=chunk) Part I. Financial Information [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=ITEM%201.%20Financial%20Statements%20%28Unaudited%29) This section presents Freshworks Inc.'s unaudited condensed consolidated financial statements and explanatory notes [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets and stockholders' equity decreased from December 31, 2024, to June 30, 2025, primarily due to reduced cash | Metric (in thousands) | June 30, 2025 | December 31, 2024 | Change | | :-------------------- | :------------ | :---------------- | :----- | | Total Assets | $1,480,826 | $1,611,884 | $(131,058) | | Total Liabilities | $496,184 | $473,963 | $22,221 | | Total Stockholders' Equity | $984,642 | $1,137,921 | $(153,279) | | Cash and cash equivalents | $485,970 | $620,315 | $(134,345) | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Freshworks Inc. reported a significant reduction in net loss for Q2 and H1 2025, driven by revenue growth and lower operating losses | Metric (in thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :--------------------------- | :--------------------------- | :--------- | | Revenue | $204,678 | $174,131 | 17.5% | $400,951 | $339,274 | 18.2% | | Gross profit | $173,536 | $145,956 | 18.9% | $339,931 | $285,209 | 19.2% | | Loss from operations | $(8,656) | $(43,787) | 80.2% | $(19,072) | $(75,954) | 74.9% | | Net loss | $(1,739) | $(20,184) | 91.4% | $(3,043) | $(43,509) | 93.0% | | Net loss per share - basic and diluted | $(0.01) | $(0.07) | 85.7% | $(0.01) | $(0.15) | 93.3% | [Condensed Consolidated Statements of Comprehensive Loss](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) Comprehensive loss significantly decreased for Q2 and H1 2025, primarily due to reduced net loss | Metric (in thousands) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | :--------------------------- | :--------------------------- | :--------- | | Net loss | $(1,739) | $(20,184) | 91.4% | $(3,043) | $(43,509) | 93.0% | | Total other comprehensive income (loss) | $(506) | $245 | -306.5% | $440 | $(275) | 260.0% | | Comprehensive loss | $(2,245) | $(19,939) | 88.7% | $(2,603) | $(43,784) | 94.1% | [Condensed Consolidated Statements of Stockholders' Equity](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Stockholders' equity decreased from December 2024 to June 2025, mainly due to **$226.7 million** in common stock repurchases | Metric (in thousands) | As of Dec 31, 2024 | As of Jun 30, 2025 | Change | | :-------------------- | :----------------- | :----------------- | :----- | | Total Stockholders' Equity | $1,137,921 | $984,642 | $(153,279) | | Repurchase and retirement of common stock, including excise tax (6 months) | — | $(226,660) | $(226,660) | | Stock-based compensation (6 months) | — | $103,007 | $103,007 | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow increased, financing cash flow rose due to repurchases, and investing activities shifted to a net inflow | Metric (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :-------------------- | :--------------------------- | :--------------------------- | :--------- | | Net cash provided by operating activities | $116,564 | $76,955 | 51.5% | | Net cash provided by (used in) investing activities | $3,389 | $(220,495) | 101.5% | | Net cash used in financing activities | $(254,287) | $(34,318) | -640.9% | | Net decrease in cash, cash equivalents and restricted cash | $(134,334) | $(177,858) | 24.4% | - Cash used in financing activities for H1 2025 was significantly impacted by **$227.2 million** in common stock repurchases[31](index=31&type=chunk) - Investing activities in H1 2024 included a **$213.9 million** business combination, which was absent in H1 2025[31](index=31&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed explanations for the financial statements, covering policies, assets, liabilities, and events [1. Basis of Presentation and Summary of Significant Accounting Policies](index=13&type=section&id=1.%20Basis%20of%20Presentation%20and%20Summary%20of%20Significant%20Accounting%20Policies) Financial statements are unaudited, GAAP-compliant, and reflect normal adjustments, with no single customer exceeding **10%** of revenue - The condensed consolidated financial statements are unaudited, prepared in accordance with GAAP, and include only normal recurring adjustments[36](index=36&type=chunk) - No single customer accounted for more than **10%** of revenue for the three and six months ended June 30, 2025 and 2024[41](index=41&type=chunk) - Recent accounting pronouncements (ASU 2023-09 and ASU 2024-03/2025-01) are disclosure-related and are not expected to have a significant impact on the condensed consolidated financial statements[43](index=43&type=chunk)[44](index=44&type=chunk) [2. Cash Equivalents and Marketable Securities](index=15&type=section&id=2.%20Cash%20Equivalents%20and%20Marketable%20Securities) Cash equivalents and marketable securities decreased from December 2024 to June 2025, with minimal unrealized losses | Metric (in thousands) | June 30, 2025 | December 31, 2024 | Change | | :-------------------- | :------------ | :---------------- | :----- | | Total cash equivalents | $418,928 | $507,655 | $(88,727) | | Total debt securities | $440,226 | $449,750 | $(9,524) | | Total cash equivalents and debt securities | $859,154 | $957,405 | $(98,251) | | Unrealized Losses (in thousands) | June 30, 2025 | December 31, 2024 | | :------------------------------- | :------------ | :---------------- | | U.S. treasury securities | $(47) | $(17) | | U.S. government agency securities | $(28) | $(12) | | Corporate debt securities | $(24) | $(21) | | Total | $(99) | $(50) | [3. Fair Value Measurements](index=16&type=section&id=3.%20Fair%20Value%20Measurements) Financial assets are measured at fair value using a hierarchy, with most classified as Level 1 or Level 2 - Money market funds and U.S. treasury securities are classified within Level 1, while other debt securities and investments are classified within Level 2, based on observable inputs[48](index=48&type=chunk)[51](index=51&type=chunk) | Financial Assets (in thousands) | Level 1 (June 30, 2025) | Level 2 (June 30, 2025) | Total (June 30, 2025) | | :------------------------------ | :---------------------- | :---------------------- | :-------------------- | | Cash equivalents | $354,211 | $64,717 | $418,928 | | Marketable securities | $192,299 | $247,927 | $440,226 | | Total financial assets | $546,510 | $312,644 | $859,154 | [4. Balance Sheet Components](index=18&type=section&id=4.%20Balance%20Sheet%20Components) Property and equipment, net, and accrued liabilities increased, driven by capitalized internal-use software and commissions | Metric (in thousands) | June 30, 2025 | December 31, 2024 | Change | | :-------------------- | :------------ | :---------------- | :----- | | Property and equipment, net | $30,894 | $25,893 | $5,001 | | Capitalized internal-use software (net carrying value) | $20,400 | $14,500 | $5,900 | | Accrued liabilities | $86,714 | $81,933 | $4,781 | - Capitalization of internal-use software costs increased significantly to **$9.16 million** for the six months ended June 30, 2025, from **$3.16 million** in the prior year period[52](index=52&type=chunk) [5. Business Combinations](index=19&type=section&id=5.%20Business%20Combinations) Freshworks acquired D42 Parent, Inc. in June 2024 for **$238.1 million**, adding goodwill and intangible assets - Freshworks acquired D42 Parent, Inc. in June 2024 for **$238.1 million** to offer a more comprehensive IT solution for customers[54](index=54&type=chunk) | Acquired Assets (in millions) | Value | | :---------------------------- | :---- | | Goodwill | $140.8 | | Intangible assets | $99.0 | | Pro Forma Financials (in thousands) | 6 Months Ended June 30, 2024 | 6 Months Ended June 30, 2023 | | :---------------------------------- | :--------------------------- | :--------------------------- | | Revenue | $354,445 | $300,038 | | Net loss | $(47,195) | $(86,699) | [6. Intangible Assets, Net](index=19&type=section&id=6.%20Intangible%20Assets%2C%20Net) Net intangible assets decreased to **$83.8 million** by June 2025, with amortization expense significantly increasing due to the D42 acquisition | Acquired Intangible Assets (in thousands) | June 30, 2025 Net Carrying Value | December 31, 2024 Net Carrying Value | | :---------------------------------------- | :------------------------------- | :------------------------------- | | Developed technology | $25,238 | $27,773 | | Customer relationships | $58,580 | $62,767 | | Trademarks | $0 | $300 | | Total | $83,818 | $90,840 | | Amortization Expense (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :---------------------------------- | :--------------------------- | :--------------------------- | :--------- | | Total amortization expense | $7,022 | $976 | 619.5% | - Expected future amortization expense related to acquired intangible assets totals **$83.8 million**, with **$6.8 million** remaining for the rest of 2025[57](index=57&type=chunk) [7. Leases](index=20&type=section&id=7.%20Leases) Freshworks primarily holds operating leases for office space, with a **3.9-year** remaining term and **$9.1 million** in H1 2025 costs | Lease Metric | June 30, 2025 | June 30, 2024 | | :----------- | :------------ | :------------ | | Weighted-average remaining lease term | 3.9 years | 4.7 years | | Weighted-average discount rate | 8.9% | 9.0% | | Lease Costs (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------- | :--------------------------- | :--------------------------- | | Total lease cost | $9,103 | $8,141 | [8. Commitments and Contingencies](index=21&type=section&id=8.%20Commitments%20and%20Contingencies) Freshworks has **$284.0 million** in commitments and is involved in legal proceedings, with no material adverse impact anticipated - Other contractual commitments total **$284.0 million** through 2028, primarily for third-party cloud infrastructure, service subscriptions, and sponsorship arrangements[60](index=60&type=chunk) - A motion for summary judgment was granted in the company's favor on April 10, 2025, in a securities class action, with the plaintiff filing a notice of appeal[61](index=61&type=chunk)[62](index=62&type=chunk) - No currently pending legal proceedings are believed to have a material adverse impact on the business or condensed consolidated financial statements[64](index=64&type=chunk) [9. Revenue From Contracts with Customers](index=22&type=section&id=9.%20Revenue%20From%20Contracts%20with%20Customers) Revenue is primarily from subscription services, totaling **$401.0 million** for H1 2025, with **$568.9 million** in remaining performance obligations - Revenue is primarily derived from subscription fees, software licenses, and maintenance, with professional services making up less than **5%** of total revenue[66](index=66&type=chunk)[70](index=70&type=chunk) | Revenue Type (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :-------------------------- | :--------------------------- | :--------------------------- | :--------- | | Subscription services, software licenses and maintenance | $396,175 | $334,173 | 18.5% | | Professional services | $4,776 | $5,101 | -6.5% | | Total revenue | $400,951 | $339,274 | 18.2% | - Remaining performance obligations as of June 30, 2025, were **$568.9 million**, with **$414.3 million** expected to be recognized as revenue in the next 12 months[74](index=74&type=chunk) [10. Segment and Geographic Information](index=24&type=section&id=10.%20Segment%20and%20Geographic%20Information) Freshworks operates as a single segment, with North America contributing the largest share of revenue (**42%** for H1 2025) - Freshworks operates in a single operating segment, with the Chief Executive Officer as the chief operating decision maker[76](index=76&type=chunk) | Geographic Revenue (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :-------------------------------- | :--------------------------- | :--------------------------- | :--------- | | North America | $186,611 | $152,937 | 22.0% | | Europe, Middle East and Africa | $155,089 | $131,373 | 18.1% | | Asia Pacific | $48,058 | $44,844 | 7.2% | | Other | $11,193 | $10,120 | 10.6% | | Total revenue | $400,951 | $339,274 | 18.2% | - Revenue generated from the United States was approximately **42%** of total consolidated revenue for the six months ended June 30, 2025[77](index=77&type=chunk) [11. Stockholders' Equity and Stock-Based Compensation](index=25&type=section&id=11.%20Stockholders%27%20Equity%20and%20Stock-Based%20Compensation) Freshworks repurchased **$225.4 million** in stock, while stock-based compensation decreased to **$102.7 million** for H1 2025 | Share Repurchase Activity (6 months ended June 30, 2025) | Value | | :------------------------------------------------------- | :---- | | Shares repurchased | 14,912,789 | | Aggregate purchase price | $225.4 million | | Remaining available for repurchase | $159.1 million | | Stock-Based Compensation (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :-------------------------------------- | :--------------------------- | :--------------------------- | :--------- | | Total stock-based compensation expense | $102,657 | $108,337 | -5.2% | - Unrecognized stock-based compensation expense related to unvested awards totaled **$386.7 million** as of June 30, 2025, with a weighted-average recognition period of **2.9 years** for RSUs and PRSUs[98](index=98&type=chunk) [12. Restructuring Charges](index=29&type=section&id=12.%20Restructuring%20Charges) Freshworks incurred **$0.4 million** in restructuring charges for H1 2025, with the plan now complete and no remaining liability - Restructuring charges of **$0.4 million** were incurred during the six months ended June 30, 2025, as part of a plan to improve operating efficiency[99](index=99&type=chunk) - The restructuring plan is complete, with no remaining liability as of June 30, 2025[99](index=99&type=chunk)[100](index=100&type=chunk) [13. Income Taxes](index=29&type=section&id=13.%20Income%20Taxes) Freshworks recorded a **$9.5 million** income tax provision for H1 2025, primarily due to the Device42 acquisition and foreign profits | Income Tax (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :------------------------ | :--------------------------- | :--------------------------- | :--------- | | Provision for (benefit from) income taxes | $9,487 | $(6,403) | 248.2% | - The change in income taxes is primarily due to a **$14.3 million** tax benefit from the Device42 acquisition in the prior year and higher foreign profits in 2025[101](index=101&type=chunk) - A full valuation allowance is maintained against U.S. federal and state deferred tax assets[102](index=102&type=chunk) [14. Net Loss Per Share](index=30&type=section&id=14.%20Net%20Loss%20Per%20Share) Basic and diluted net loss per share significantly improved to **$(0.01)** for H1 2025 from **$(0.15)** in the prior year | Metric | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :----- | :--------------------------- | :--------------------------- | :--------- | | Net loss per share - basic and diluted | $(0.01) | $(0.15) | 93.3% | - Potential common equivalents (RSUs, PRSUs, stock options, ESPP) totaling **27.8 million** shares were excluded from diluted net loss per share computation due to their antidilutive effect[106](index=106&type=chunk) [15. Subsequent Events](index=30&type=section&id=15.%20Subsequent%20Events) The OBBBA was signed into law, and Freshworks entered new lease agreements for its San Mateo headquarters - The One Big Beautiful Bill Act (OBBBA), signed July 4, 2025, allows immediate expensing of domestic U.S. research and development costs and certain capital expenditures, with an immaterial impact expected for Q3/Q4 2025[107](index=107&type=chunk) - New lease agreements for the San Mateo headquarters were entered in July 2025, extending the lease term to July 2031 and expanding office space, with an estimated total commitment of **$18.0 million**[108](index=108&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Freshworks' financial condition, results, key metrics, non-GAAP measures, liquidity, and macroeconomic impacts [Overview](index=32&type=section&id=Overview) Freshworks provides AI-powered CX and EX software, reporting **18%** YoY revenue growth and significantly reduced operating losses - Freshworks offers people-first, AI service software for Customer Experience (CX) and Employee Experience (EX), including generative AI solutions like Freddy AI Agent and Freddy AI Copilot[110](index=110&type=chunk) | Metric (in millions) | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Growth | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Growth | | :------------------- | :--------------------------- | :--------------------------- | :--------- | :--------------------------- | :--------------------------- | :--------- | | Total revenue | $204.7 | $174.1 | 18% | $401.0 | $339.3 | 18% | | Operating losses | $(8.7) | $(43.8) | 80.2% | $(19.1) | $(76.0) | 74.9% | [Macroeconomic and Other Factors](index=32&type=section&id=Macroeconomic%20and%20Other%20Factors) Macroeconomic uncertainties impact business spending and net dollar retention, with **27%** of revenue exposed to foreign currency risk - Macroeconomic uncertainties, including inflationary pressures and global market volatility, have impacted business spending and adversely affected the net dollar retention rate due to lower expansion within existing customers[113](index=113&type=chunk) - Approximately **27%** of revenue is exposed to foreign currency exchange rate fluctuations, particularly the euro and British Pound[113](index=113&type=chunk) [Key Business Metrics](index=33&type=section&id=Key%20Business%20Metrics) Customers contributing over **$5,000** in ARR increased by **10%**, while the net dollar retention rate remained flat at **106%** | Metric | As of June 30, 2025 | As of June 30, 2024 | % Growth | | :------------------------------------------------ | :------------------ | :------------------ | :------- | | Number of customers contributing > $5,000 in ARR | 23,975 | 21,744 | 10% | | ARR from customers contributing > $5,000 in ARR as % of total ARR | 91% | 90% | 1% pt | | Net dollar retention rate | 106% | 106% | 0% | - The net dollar retention rate remained flat at **106%** due to lower expansion within existing customers driven by macroeconomic pressures, offset by favorable foreign currency impact and a slight improvement in overall churn rate[120](index=120&type=chunk) - Monthly subscriptions represented **13%** of ARR as of June 30, 2025, and generally have a lower net dollar retention rate than the overall rate[119](index=119&type=chunk) [Non-GAAP Financial Measures](index=34&type=section&id=Non-GAAP%20Financial%20Measures) Non-GAAP income from operations (**$91.2 million**), net income (**$108.4 million**), and free cash flow (**$109.7 million**) all significantly increased for H1 2025 - Non-GAAP financial measures exclude stock-based compensation, employer payroll taxes on employee stock transactions, amortization of acquired intangibles, restructuring charges, and income tax adjustments[124](index=124&type=chunk)[125](index=125&type=chunk) | Non-GAAP Metric (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change | | :----------------------------- | :--------------------------- | :--------------------------- | :--------- | | Non-GAAP income from operations | $91,200 | $34,869 | 161.5% | | Non-GAAP net income | $108,421 | $53,934 | 100.9% | | Free cash flow | $109,661 | $71,495 | 53.4% | [Components of Our Results of Operations](index=36&type=section&id=Components%20of%20Our%20Results%20of%20Operations) This section details revenue sources, cost of revenue, and operating expenses, including R&D, sales & marketing, and G&A - Revenue is primarily derived from subscriptions for cloud-based software products, with software licenses, maintenance, and professional services (less than **5%** of total revenue) also contributing[130](index=130&type=chunk)[131](index=131&type=chunk) - Cost of revenue consists primarily of personnel-related expenses, cloud-based infrastructure costs, payment gateway fees, product support, professional services, third-party license fees, and amortization of acquired technology and capitalized internal-use software[133](index=133&type=chunk) - Operating expenses (Research and Development, Sales and Marketing, General and Administrative) are expected to increase in dollar amount but may decline as a percentage of revenue over the longer term[137](index=137&type=chunk)[139](index=139&type=chunk)[141](index=141&type=chunk) [Results of Operations](index=38&type=section&id=Results%20of%20Operations) Freshworks achieved **18%** revenue growth for Q2 and H1 2025, with improved gross margin and significantly reduced net loss [Comparison of the Three Months Ended June 30, 2025 and 2024](index=39&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030%2C%202025%20and%202024) Q2 2025 revenue grew **18%** to **$204.7 million**, gross margin improved to **85%**, and net loss significantly decreased | Metric (in thousands) | Q2 2025 | Q2 2024 | Change ($) | Change (%) | | :-------------------- | :------ | :------ | :--------- | :--------- | | Total revenue | $204,678 | $174,131 | $30,547 | 18% | | Gross Margin | 85% | 84% | 1% pt | | | Total operating expenses | $182,192 | $189,743 | $(7,551) | (4)% | | Net loss | $(1,739) | $(20,184) | $18,445 | 91.4% | - The increase in revenue was attributable to approximately **$19.1 million** from new customers and **$11.4 million** from existing customers[149](index=149&type=chunk) - The decrease in operating expenses was primarily driven by lower stock-based compensation (**$1.8 million** in R&D, **$6.6 million** in Sales and Marketing) and personnel-related costs due to employee terminations following restructuring[152](index=152&type=chunk)[153](index=153&type=chunk)[154](index=154&type=chunk) [Comparison of the Six Months Ended June 30, 2025 and 2024](index=42&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) H1 2025 revenue grew **18%** to **$401.0 million**, gross margin improved to **85%**, and net loss significantly decreased | Metric (in thousands) | H1 2025 | H1 2024 | Change ($) | Change (%) | | :-------------------- | :------ | :------ | :--------- | :--------- | | Total revenue | $400,951 | $339,274 | $61,677 | 18% | | Gross Margin | 85% | 84% | 1% pt | | | Total operating expenses | $359,003 | $361,163 | $(2,160) | (1)% | | Net loss | $(3,043) | $(43,509) | $40,466 | 93.0% | - The increase in revenue was attributable to approximately **$32.6 million** from new customers and **$29.1 million** from existing customers[161](index=161&type=chunk) - The decrease in operating expenses was primarily driven by lower stock-based compensation (**$10.5 million** in Sales and Marketing) and personnel-related costs from lower headcount due to restructuring, partially offset by increased amortization of acquired intangible assets from the D42 Parent, Inc. acquisition (**$3.6 million**)[163](index=163&type=chunk)[165](index=165&type=chunk) [Liquidity and Capital Resources](index=44&type=section&id=Liquidity%20and%20Capital%20Resources) Freshworks holds **$486.0 million** in cash and **$440.2 million** in marketable securities, with **$116.6 million** from H1 2025 operating activities | Liquidity (in millions) | June 30, 2025 | | :---------------------- | :------------ | | Cash and cash equivalents | $486.0 | | Marketable securities | $440.2 | - Net cash provided by operating activities was **$116.6 million** for the six months ended June 30, 2025[177](index=177&type=chunk) - The company repurchased **$225.4 million** of Class A common stock during H1 2025, with **$159.1 million** remaining available under the program[174](index=174&type=chunk) - Existing liquidity is expected to be sufficient to meet working capital and capital expenditure needs for at least the next 12 months[176](index=176&type=chunk) [Critical Accounting Policies and Estimates](index=45&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) No changes to critical accounting policies and estimates were reported for Q2 and H1 2025 - No changes to critical accounting policies and estimates were reported for the three and six months ended June 30, 2025[185](index=185&type=chunk) [Recent Accounting Pronouncements](index=46&type=section&id=Recent%20Accounting%20Pronouncements) Recent accounting pronouncements are disclosure-related and not expected to materially impact financial statements - Information on recent accounting pronouncements is provided in Note 1, with the guidance primarily related to disclosures and not expected to have a significant impact on the financial statements[186](index=186&type=chunk)[43](index=43&type=chunk)[44](index=44&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=46&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Freshworks is exposed to foreign currency and interest rate risks, mitigated by hedging and investment classification [Foreign Currency Exchange Risk](index=46&type=section&id=Foreign%20Currency%20Exchange%20Risk) Freshworks is exposed to foreign currency risk, hedging Indian Rupee expenses with **$63.6 million** in forward contracts - Freshworks is exposed to foreign currency exchange risk, particularly from changes in the Indian Rupee, British Pound, and euro, due to operating expenses denominated in local currencies[188](index=188&type=chunk) - Foreign exchange forward contracts are used to hedge a portion of forecasted Indian Rupee expenses, with a total notional amount of **$63.6 million** outstanding as of June 30, 2025[189](index=189&type=chunk) - A hypothetical **10%** adverse foreign currency exchange rate change would result in an approximate **$12.1 million** gain or loss on total monetary assets and liabilities[188](index=188&type=chunk) [Interest Rate Risk](index=46&type=section&id=Interest%20Rate%20Risk) Cash, cash equivalents, and marketable securities are subject to interest rate risk, but a **100 basis point** movement is immaterial - The company's cash, cash equivalents, and marketable securities are subject to market risk due to changes in interest rates[191](index=191&type=chunk) - A hypothetical **100 basis points** favorable or adverse movement in interest rates would not have a material effect on the combined market value of cash, cash equivalents, and marketable securities[193](index=193&type=chunk) - Marketable securities are classified as 'available for sale,' so unrealized gains or losses from interest rate changes are not recognized unless securities are sold or declines are determined to be other-than-temporary[192](index=192&type=chunk) [Item 4. Controls and Procedures](index=47&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls were effective, with no material changes in internal control over financial reporting [Evaluation of Disclosure Controls and Procedures](index=47&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) Disclosure controls and procedures were evaluated and deemed effective as of June 30, 2025 - Disclosure controls and procedures were evaluated and deemed effective as of June 30, 2025[194](index=194&type=chunk) [Changes in Internal Control over Financial Reporting](index=47&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) No material changes in internal control over financial reporting were identified during the most recent fiscal quarter - No material changes in internal control over financial reporting were identified during the most recent fiscal quarter[195](index=195&type=chunk) [Inherent Limitations on Effectiveness of Controls](index=47&type=section&id=Inherent%20Limitations%20on%20Effectiveness%20of%20Controls) Any system of controls provides only reasonable assurance, subject to inherent limitations and future event assumptions - Any system of controls provides only reasonable, not absolute, assurance, and its effectiveness is subject to inherent limitations and assumptions about future events[196](index=196&type=chunk) Part II. Other Information [Item 1. Legal Proceedings](index=48&type=section&id=ITEM%201.%20Legal%20Proceedings) Information on legal proceedings is incorporated by reference from Note 8, Commitments and Contingencies - Information on legal proceedings is incorporated by reference from Note 8. Commitments and Contingencies in the financial statements[198](index=198&type=chunk) [Item 1A. Risk Factors](index=48&type=section&id=ITEM%201A.%20Risk%20Factors) No material changes to risk factors were reported from those previously disclosed in the Annual Report on Form 10-K - No material changes from the risk factors previously disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2024, were reported[199](index=199&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=48&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales or specific use of proceeds were reported, but **8.18 million** shares were repurchased for **$113.6 million** [Unregistered Sales of Equity Securities](index=48&type=section&id=Unregistered%20Sales%20of%20Equity%20Securities) No unregistered sales of equity securities occurred during the reporting period - No unregistered sales of equity securities occurred during the reporting period[200](index=200&type=chunk) [Use of Proceeds](index=48&type=section&id=Use%20of%20Proceeds) No specific use of proceeds was reported - No specific use of proceeds was reported[201](index=201&type=chunk) [Issuer Purchases of Equity Securities](index=48&type=section&id=Issuer%20Purchases%20of%20Equity%20Securities) Freshworks repurchased **8.18 million** Class A common shares for **$113.6 million** in Q2 2025, with **$159.1 million** remaining | Period (3 months ended June 30, 2025) | Total Shares Repurchased | Average Price Paid Per Share | Approximate Dollar Value Remaining | | :------------------------------------ | :----------------------- | :--------------------------- | :--------------------------------- | | April 1 - April 30, 2025 | 4,226,826 | $12.81 | $218,557,000 | | May 1 - May 31, 2025 | 2,462,769 | $14.88 | $181,902,000 | | June 1 - June 30, 2025 | 1,490,804 | $15.29 | $159,110,000 | | Total | 8,180,399 | | | - The share repurchase program, approved in November 2024, authorized the repurchase of up to **$400 million** of outstanding Class A common stock[204](index=204&type=chunk) [Item 3. Defaults Upon Senior Securities](index=49&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to Freshworks Inc. for the reporting period - This item is not applicable[205](index=205&type=chunk) [Item 4. Mine Safety Disclosures](index=49&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is not applicable to Freshworks Inc. for the reporting period - This item is not applicable[206](index=206&type=chunk) [Item 5. Other Information](index=50&type=section&id=ITEM%205.%20Other%20Information) This section discloses Rule 10b5-1 trading plans adopted or terminated by officers and directors [Rule 10b5-1 Trading Plans](index=50&type=section&id=Rule%2010b5-1%20Trading%20Plans) Officers and directors adopted Rule 10b5-1 trading plans for Class A common stock sales during Q2 2025 | Name | Title | Action | Adoption Date | Expiration Date | Total Shares to be Sold | | :--------------- | :------------------------------------ | :----- | :------------ | :-------------- | :---------------------- | | Philippa Lawrence | Chief Accounting Officer | Adoption | June 16, 2025 | March 27, 2026 | Up to 34,178 shares | | Tyler Sloat | Chief Operating Officer and Chief Financial Officer | Adoption | May 27, 2025 | August 31, 2026 | Up to 500,000 shares | [Item 6. Exhibits](index=51&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including corporate documents and certifications - Exhibits include corporate documents (Amended and Restated Certificate of Incorporation, Bylaws), CEO/CFO certifications (302 and 906), and Inline XBRL Instance Document and Taxonomy Extensions[211](index=211&type=chunk) Signatures [Report Signatures](index=52&type=section&id=Report%20Signatures) The Quarterly Report on Form 10-Q was signed on July 29, 2025, by the CEO, COO/CFO, and CAO - The report was signed on July 29, 2025, by the Chief Executive Officer and President, Chief Operating Officer and Chief Financial Officer, and Chief Accounting Officer[216](index=216&type=chunk)

[Second Quarter 2025 Financial and Business Highlights](index=1&type=section&id=Second%20Quarter%202025%20Financial%20and%20Business%20Highlights) Freshworks exceeded Q2 2025 financial estimates with 18% revenue growth and significant non-GAAP operating income, driven by customer expansion and AI product launches [Q2 2025 Financial Performance](index=1&type=section&id=Q2%202025%20Financial%20Performance) - Freshworks exceeded financial estimates in Q2 2025, driven by **strong revenue growth** and **significantly improved operating cash flow** and **adjusted free cash flow margins**[3](index=3&type=chunk) Q2 2025 Financial Summary (vs. Q2 2024) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Total Revenue | $204.7M | $174.1M | +18% | | GAAP (Loss) from Operations | $(8.7)M | $(43.8)M | +80.1% | | Non-GAAP Income from Operations | $44.8M | $13.1M | +242.0% | | GAAP Net (Loss) Per Share | $(0.01) | $(0.07) | +85.7% | | Non-GAAP Net Income Per Share | $0.18 | $0.08 | +125.0% | | Net Cash from Operating Activities | $58.6M | $36.3M | +61.4% | | Adjusted Free Cash Flow | $54.3M | $32.8M | +65.5% | [Q2 2025 Key Metrics and Business Highlights](index=1&type=section&id=Q2%202025%20Key%20Metrics%20and%20Business%20Highlights) Key Operating Metrics | Metric | Q2 2025 | Q1 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | :--- | | Customers > $5,000 ARR | 23,975 | - | - | +10% | | Net Dollar Retention Rate | 106% | 105% | 106% | Flat | - Recent business highlights include onboarding new customers such as AEP Energy, Seagate Technology, and Manchester Metropolitan University[11](index=11&type=chunk) - Launching the Freddy AI Agent Studio, a no-code platform for creating autonomous AI agents[11](index=11&type=chunk) - Freddy AI Copilot and Agent products surpassed **$20 million** in combined annual recurring revenue[11](index=11&type=chunk) - Announcing a multi-year partnership with the McLaren Formula 1 Team[11](index=11&type=chunk) [Financial Outlook](index=2&type=section&id=Financial%20Outlook) The company provided guidance for the third quarter of 2025 and raised its full-year 2025 outlook, anticipating continued double-digit revenue growth and strong non-GAAP operating income Q3 and Full Year 2025 Guidance | ($ in millions, except per share data) | Third Quarter 2025 | Full Year 2025 | | :--- | :--- | :--- | | Revenue | $207.0 - $210.0 | $822.9 - $828.9 | | Year-over-year growth (constant currency) | 11% - 12% | 14% - 16% | | Non-GAAP income from operations | $31.2 - $33.2 | $153.0 - $157.0 | | Non-GAAP net income per share | $0.12 - $0.14 | $0.56 - $0.58 | [Consolidated Financial Statements (Unaudited)](index=6&type=section&id=Consolidated%20Financial%20Statements%20(Unaudited)) The unaudited financial statements reveal a significant reduction in net loss, strong liquidity, and robust operating cash flow, despite increased financing outflows [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Statement of Operations Highlights (Three Months Ended June 30) | (in thousands) | 2025 | 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | $204,678 | $174,131 | +17.5% | | Gross Profit | $173,536 | $145,956 | +18.9% | | Loss from Operations | $(8,656) | $(43,787) | +80.2% | | Net Loss | $(1,739) | $(20,184) | +91.4% | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance Sheet Highlights | (in thousands) | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $485,970 | $620,315 | | Marketable securities | $440,226 | $449,750 | | Total Assets | $1,480,826 | $1,611,884 | | Deferred Revenue | $339,210 | $323,435 | | Total Liabilities | $496,184 | $473,963 | | Total Stockholders' Equity | $984,642 | $1,137,921 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Highlights (Three Months Ended June 30) | (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $58,591 | $36,336 | | Net cash provided by (used in) investing activities | $(42,842) | $(182,724) | | Net cash used in financing activities | $(124,014) | $(11,364) | - The **significant increase** in cash used in financing activities in Q2 2025 was primarily due to **$113.6 million** in common stock repurchases, which did not occur in the same period of 2024[32](index=32&type=chunk) [Reconciliation of GAAP to Non-GAAP Measures](index=9&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) This section details the reconciliation of GAAP to non-GAAP financial metrics, highlighting adjustments for stock-based compensation to derive non-GAAP operating income and net income Q2 2025 Reconciliation of GAAP Loss to Non-GAAP Income from Operations | (in thousands) | Amount | | :--- | :--- | | **GAAP loss from operations** | **$(8,656)** | | Stock-based compensation expense | $49,280 | | Employer payroll taxes on employee stock transactions | $702 | | Amortization of acquired intangibles | $3,508 | | Restructuring charges | $— | | **Non-GAAP income from operations** | **$44,834** | Q2 2025 Computation of Adjusted Free Cash Flow | (in thousands) | Amount | | :--- | :--- | | Net cash provided by operating activities | $58,591 | | Less: Purchases of property and equipment | $(380) | | Less: Capitalized internal-use software | $(4,676) | | Add: Restructuring costs paid | $728 | | **Adjusted free cash flow** | **$54,263** | [Important Disclosures and Definitions](index=3&type=section&id=Important%20Disclosures%20and%20Definitions) This section clarifies the company's non-GAAP financial measures and operating metrics, along with a disclaimer regarding forward-looking statements and associated risks [Explanation of Non-GAAP Financial Measures and Operating Metrics](index=3&type=section&id=Explanation%20of%20Non-GAAP%20Financial%20Measures%20and%20Operating%20Metrics) - The company uses non-GAAP measures to assess performance by excluding certain expenses, primarily stock-based compensation expense, employer payroll taxes on employee stock transactions, amortization of acquired intangibles, and restructuring charges[17](index=17&type=chunk)[22](index=22&type=chunk) - Key operating metrics are defined as: **Customers > $5,000 in ARR** are business entities with one or more paid subscriptions contributing over $5,000 in annual recurring revenue[19](index=19&type=chunk) - **Net Dollar Retention Rate** is calculated by dividing the Ending ARR from a cohort of customers by the Entering ARR from the same cohort 12 months prior[20](index=20&type=chunk) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) - The report contains forward-looking statements, including financial guidance for Q3 and full-year 2025, which are subject to risks and uncertainties such as **uncertain global economic conditions**, **ability to attract and retain customers**, and a **history of net losses**[23](index=23&type=chunk)

Core Viewpoint - Freshworks Inc. reported strong financial results for Q2 2025, with an 18% year-over-year revenue growth, reflecting increased demand for its AI-powered service solutions [2][6]. Financial Summary - Total revenue for Q2 2025 was $204.7 million, up from $174.1 million in Q2 2024, marking an 18% increase. Adjusted for constant currency, the growth was 17% [6][35]. - GAAP loss from operations improved to $(8.7) million from $(43.8) million in the same quarter last year [6]. - Non-GAAP income from operations was $44.8 million, compared to $13.1 million in Q2 2024 [6]. - GAAP net loss per share was $(0.01), an improvement from $(0.07) in Q2 2024 [6]. - Non-GAAP diluted net income per share was $0.18, up from $0.08 in Q2 2024 [6]. - Net cash provided by operating activities was $58.6 million, compared to $36.3 million in Q2 2024 [6]. - Adjusted free cash flow reached $54.3 million, compared to $32.8 million in Q2 2024 [6]. Key Metrics and Business Highlights - The number of customers contributing more than $5,000 in ARR increased by 10% year-over-year to 23,975 [7]. - The net dollar retention rate was 106%, consistent with Q1 2025 and Q2 2024 [7]. - Freshworks onboarded several new customers, including AEP Energy and Seagate Technology [7]. - The company launched the next generation of its Freddy AI Platform, enhancing its AI capabilities [7]. - The combined annual recurring revenue from Freddy AI Copilot and Freddy AI Agent products surpassed $20 million [7]. Financial Outlook - For Q3 2025, Freshworks expects revenue between $207.0 million and $210.0 million, representing a year-over-year growth of 11% to 12% [9]. - The full-year 2025 revenue guidance is set between $822.9 million and $828.9 million, indicating a growth of 14% to 15% [9]. - Non-GAAP income from operations for Q3 is projected to be between $31.2 million and $33.2 million, with non-GAAP net income per share expected to be between $0.12 and $0.14 [9].

Core Insights - Freshworks has announced a multi-year partnership with McLaren Racing, becoming an Official Partner of the McLaren Formula 1 Team [1] - The partnership involves the integration of Freshworks' ITSM solution, Freshservice, to enhance productivity and improve IT services within the McLaren team [1][2] Company Overview - Freshworks Inc. specializes in uncomplicated service software aimed at delivering exceptional customer and employee experiences, with over 73,000 companies relying on its solutions [8] - McLaren Racing, founded in 1963, has a rich history in motorsport, winning 21 Formula 1 world championships and competing across multiple racing series [5][6] Partnership Details - Freshservice will support McLaren's IT team by reducing tech-related issues, allowing the team to focus on performance during races [3][15] - Freshworks branding will be prominently displayed on McLaren's race cars and team kit for the remainder of the 2025 season, starting with the Belgian Grand Prix [3] Leadership Statements - Zak Brown, CEO of McLaren Racing, emphasized that improving efficiencies off the track is crucial for on-track performance, highlighting the value of the partnership with Freshworks [4] - Dennis Woodside, CEO of Freshworks, stated that the partnership aims to optimize McLaren's IT operations, enhancing their support for winning performance through AI-driven solutions [4]

Group 1 - Freshworks describes its business as providing modern and innovative AI-guided customer and employee service solutions aimed at enhancing engagement and productivity for companies of all sizes [1] - The company operates in the technology sector, particularly focusing on customer service and employee engagement solutions [1]

Core Insights - The article does not provide specific company or industry insights, focusing instead on disclosures and disclaimers related to investment positions and advice [1][2] Group 1 - There are no stock, option, or similar derivative positions held by the analyst in any mentioned companies, nor plans to initiate such positions within the next 72 hours [1] - The article expresses personal opinions of the author and does not reflect the views of Seeking Alpha as a whole [2] - Seeking Alpha's analysts include both professional and individual investors who may not be licensed or certified by any regulatory body [2]

Core Insights - Freshworks has launched Freshservice Journeys, an AI-assisted capability aimed at enhancing employee experience (EX) by streamlining complex employee processes such as onboarding and promotions [1][9] - The solution is designed to improve efficiency, reduce friction, and enhance collaboration across departments, addressing issues caused by legacy systems and siloed operations [2][8] Product Features - Freshservice Journeys offers no-code workflow creation, AI-powered task automation, real-time progress tracking, and cross-department visibility, which helps eliminate bottlenecks and improve employee experience [3][4][6] - The platform allows IT and HR teams to rapidly design and deploy workflows without technical support, using either custom workflows or pre-built templates [5][7] Market Adoption - Over 60% of Freshworks' total Annual Recurring Revenue (ARR) now comes from mid-market and enterprise clients, with 79% of this driven by solutions enhancing employee experience [8][9] - The company continues to grow its customer base, adding around 250 customers to reach more than 1,600, indicating strong market demand for its services [10] Financial Performance - Freshworks maintains a focus on investing in employee experience and AI to boost customer productivity, contributing to its revenue and profit growth [9] - The company has a Zacks Rank 1 (Strong Buy), with shares gaining 19.2% over the past year, compared to the industry growth of 36.4% [12]

Core Viewpoint - Freshworks Inc. is set to announce its financial results for the second quarter of 2025 on July 29, 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 second quarter ended June 30, 2025, will be announced after market close on July 29, 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 be available afterward [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 73,000 companies, including notable names like Bridgestone, New Balance, Nucor, S&P Global, and Sony Music, utilize Freshworks' software for customer experience (CX) and employee experience (EX) [3].

Core Viewpoint - Freshworks Inc. has been upgraded to a Zacks Rank 1 (Strong Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][2] Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [3][5] - Institutional investors often rely on earnings estimates to determine the fair value of stocks, leading to buying or selling actions that affect stock prices [3] Freshworks' Earnings Outlook - For the fiscal year ending December 2025, Freshworks is expected to earn $0.57 per share, unchanged from the previous year [7] - Over the past three months, the Zacks Consensus Estimate for Freshworks has increased by 20.5%, indicating a positive trend in earnings estimates [7] Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [6] - Only the top 5% of Zacks-covered stocks receive a "Strong Buy" rating, indicating superior earnings estimate revisions [8][9] Implications for Investors - The upgrade to Zacks Rank 1 positions Freshworks among the top 5% of stocks, suggesting potential for market-beating returns in the near term [9]

Core Insights - Freshworks has launched Freshservice Journeys, an AI-powered capability aimed at simplifying complex workflows across HR, IT, and facilities to enhance employee experiences during transitions [1][2] - The solution addresses inefficiencies caused by legacy systems and siloed operations, enabling better coordination and accountability among departments [2][3] Product Features - Freshservice Journeys allows organizations to create no-code workflows for key employee events such as onboarding, offboarding, promotions, and relocations [1][5] - The platform leverages AI to automate routine tasks, reducing manual work and speeding up task completion [5][6] - It features an intuitive interface that enables admins to configure workflows easily and utilize pre-built templates for faster implementation [5][6] Benefits and Impact - Organizations using Freshservice Journeys report significant improvements in efficiency, with processes that previously took days now completed in hours [4][6] - The solution enhances cross-functional collaboration by automating task assignments, reminders, and providing real-time progress tracking [5][6] - Companies that implement cross-functional processes describe them as transformative, enabling seamless orchestration of employee experiences without compromising departmental needs [3][4] Customer Testimonials - Qualfon's Vice President of IT Operations noted that Freshservice has transformed their offboarding process, improving visibility and compliance [4] - EquiTrust Life Insurance's IT Service Management Analyst highlighted the benefits of customized workflows and real-time visibility for HR [4] Company Overview - Freshworks Inc. provides service software designed to enhance customer and employee experiences, with over 73,000 companies relying on its solutions [7]