Companies

Freshworks Inc Class A

NASDAQ: FRSH
$13.46
▼ $0.46 (−3.30%) today
Markets closed · 7:49pm ET

Q1 2025 Earnings

Reported Apr 29, 2025, 4:13pm ET · SEC source
$0.18
Beat +39.32%
EPS · est. $0.13
$196.3M
Beat +2.28%
Revenue · est. $191.9M
−5.2%
Trailing market
FRSH vs S&P since report
1 quarter
Consecutive EPS beats

Market Reaction

% change · around the report
−8%−4%0+4%Apr 29Apr 30report 4:13pm ETearnings+0.8%−3.1%
−8%−4%0+4%Apr 29Apr 30earnings+0.8%−3.1%
FRSH −3.1%S&P 500 +0.8%
−8%−4%0+4%Apr 29Apr 30report 4:13pm ETearnings+1.3%−3.1%
−8%−4%0+4%Apr 29Apr 30earnings+1.3%−3.1%
FRSH −3.1%NASDAQ +1.3%
−12%−8%−4%0Apr 28May 7report 4:13pm ETearnings+1.2%−10.4%
−12%−8%−4%0Apr 28May 7earnings+1.2%−10.4%
FRSH −10.4%S&P 500 +1.2%
−10%−5%0Apr 28May 7report 4:13pm ETearnings+1.8%−10.4%
−10%−5%0Apr 28May 7earnings+1.8%−10.4%
FRSH −10.4%NASDAQ +1.8%
+3.00%
Day of report
−1.96%
Next session
−3.72%
One week
+1.69%
30 days

S&P 500 over the same 30 days: +6.88%.

Did FRSH Beat Earnings? Q1 2025 Results

Freshworks kicked off 2025 with a notably strong quarter, posting first-quarter revenue of $196.27 million, up 18.9% year over year and ahead of the $191.90 million consensus estimate, while earnings per share of $0.18 beat the $0.13 consensus by 39.32%, underscoring a meaningful profitability shift in the business. The primary driver behind the margin expansion was a dramatic improvement in operating efficiency, with non-GAAP operating income more than doubling to $46.37 million from $21.76 million a year ago, pushing non-GAAP operating margin to 23.6% from 13.2%. GAAP net loss narrowed to a near-breakeven $1.30 million, compared to a $23.32 million loss in Q1 2024, as the company also generated $57.97 million in operating cash flow. Freshworks further returned $113.61 million to shareholders through share repurchases during the quarter. The company's AI-driven service management portfolio, which recently expanded with the acquisition of FireHydrant, continued to attract enterprise customers, with ARR contributors above $5,000 growing 13% year over year to 23,275. Looking ahead, Freshworks guided Q2 revenue of $197.30 million to $200.30 million and full-year revenue of $815.30 million to $824.30 million, reflecting 13% to 14% growth, a moderation from Q1's pace that investors will likely monitor closely.

Key Takeaways
  • Revenue grew 19% year-over-year to $196.3 million
  • Non-GAAP operating margin expanded to 23.6% from 13.2% year-over-year
  • Operating cash flow margin of 29.5% and adjusted free cash flow margin of 28.2%
  • Customers contributing more than $5,000 in ARR grew 13% YoY to 23,275
  • Net dollar retention rate of 105%

“Freshworks had another fantastic quarter, outperforming our previously provided financial estimates in Q1 with revenue growing 19% year-over-year to $196.3 million, operating cash flow margin of 30% and adjusted free cash flow margin of 28%. We continue to outperform because businesses are choosing Freshworks for our uncomplicated customer and employee service solutions.”

Freshworks CEO, on the earnings call

Forward Guidance & Outlook

For Q2 2025, Freshworks expects revenue of $197.3 million to $200.3 million (13%-15% YoY growth, 13%-15% constant currency), non-GAAP income from operations of $27.8 million to $29.8 million, and non-GAAP net income per share of $0.10 to $0.12. For full year 2025, the company expects revenue of $815.3 million to $824.3 million (13%-14% YoY growth, 13%-15% constant currency), non-GAAP income from operations of $139.5 million to $147.5 million, and non-GAAP net income per share of $0.56 to $0.58. Revenue and non-GAAP income from operations estimates are based on exchange rates as of April 25, 2025.

FRSH YoY Financials

Q1 2025 vs Q1 2024 · SEC filings Q1 2024 Q1 2025
$0$60.0M$120.0M$180.0M$165.1M$196.3MRevenue$139.3M$166.4MGross Profit$-6,214,056$-10,416,000Operating Income$-670,747$-1,304,000Net Income
$0$60.0M$120.0M$180.0MRevenueGross ProfitOperating IncomeNet Income

Figures from SEC filings and company reports. Not investment advice.