Needham Reaffirms Buy on Freshworks (FRSH), Sets $25 Price Target

Core Viewpoint - Freshworks Inc. is highlighted as a notable AI stock to monitor, with a Buy rating and a price target of $25.00 set by Needham analyst Scott Berg following the company's Analyst Day [1][3]. Financial Model and Growth Strategy - Freshworks presented its FY28 financial model, focusing on accelerating organic revenue growth and achieving incremental free cash flow (FCF) leverage, aiming for a "Rule of 45" framework [1][3]. - The company targets a $1.3 billion Annual Recurring Revenue (ARR), with a focus on sustaining a 20% growth rate in its Employee Experience (EX) segment and scaling its IT Asset Management (ITAM) ARR beyond $100 million [2][3]. Growth Drivers and Competitive Landscape - Key growth drivers identified include increasing deal sizes, competitive products such as those from Device42, and new partner initiatives [2][3]. - The company believes that targets for its Customer Experience (CX), Enterprise Service Management (ESM), and AI segments are relatively achievable given current growth levels and high demand for ESM and AI modules [3].