Companies /Technology

Freshworks Inc Class A

NASDAQ: FRSH Software - Application
$13.46
▼ $0.46 (−3.30%) today
Markets closed · 4:40pm ET

Q2 2025 Earnings

Reported Jul 29, 2025, 4:13pm ET · SEC source
$0.18
Beat +55.84%
EPS · est. $0.12
$204.7M
Beat +2.89%
Revenue · est. $198.9M
−2.4%
Trailing market
FRSH vs S&P since report
1 quarter
Consecutive EPS beats

Market Reaction

% change · around the report
−6%−4%−2%0Jul 29Jul 30report 4:13pm ETearnings+0.4%−5.8%
−6%−4%−2%0Jul 29Jul 30earnings+0.4%−5.8%
FRSH −5.8%S&P 500 +0.4%
−6%−3%0Jul 29Jul 30report 4:13pm ETearnings+0.9%−5.8%
−6%−3%0Jul 29Jul 30earnings+0.9%−5.8%
FRSH −5.8%NASDAQ +0.9%
−8%−4%0Jul 28Aug 6report 4:13pm ETearnings−0.4%−5.0%
−8%−4%0Jul 28Aug 6earnings−0.4%−5.0%
FRSH −5.0%S&P 500 −0.4%
−8%−4%0Jul 28Aug 6report 4:13pm ETearnings+0.0%−5.0%
−8%−4%0Jul 28Aug 6earnings+0.0%−5.0%
FRSH −5.0%NASDAQ +0.0%
−2.44%
Day of report
−4.27%
Next session
−1.84%
One week
−0.74%
30 days

S&P 500 over the same 30 days: +1.67%.

Did FRSH Beat Earnings? Q2 2025 Results

Freshworks posted a decidedly strong second quarter, with the cloud software maker beating Wall Street on both the top and bottom lines as accelerating profitability and growing AI traction defined the period. Revenue climbed 17.5% year over year to $204.68 million, edging past the $198.94 million consensus, while non-GAAP diluted EPS of $0.18 cleared the $0.12 estimate by 55.84%, powered by a dramatic expansion in operating leverage that saw non-GAAP operating income more than triple to $44.83 million and non-GAAP operating margin widen to 21.9% from 7.5% a year earlier. A key driver of the narrative was AI monetization, with Freshworks reporting that its Freddy AI Copilot and Freddy AI Agent products crossed $20 million in combined ARR, underscoring meaningful commercial traction for its autonomous agent strategy. Free cash flow of $54.26 million and $926.20 million in total liquidity reinforced the financial foundation. Encouraged by the momentum, management raised full-year 2025 revenue guidance to $822.90 to $828.90 million, representing 14% to 15% growth, with non-GAAP EPS now expected at $0.56 to $0.58.

Key Takeaways
  • 18% year-over-year revenue growth driven by demand for AI-powered service solutions
  • Freddy AI Copilot and Freddy AI Agent products crossed $20M in combined ARR
  • Net dollar retention rate of 106%
  • Customers contributing more than $5,000 in ARR grew 10% YoY to 23,975
  • Significant operating leverage with non-GAAP operating margin expanding to 21.9% from 7.5%
  • Operating cash flow margin of 28.6% and adjusted free cash flow margin of 26.5%

“Freshworks delivered another strong quarter, exceeding our previously provided financial estimates in Q2 with 18% year-over-year revenue growth to $204.7 million, a 29% operating cash flow margin, and 27% adjusted free cash flow margin.”

Freshworks CEO, on the earnings call

Forward Guidance & Outlook

Freshworks raised its full-year 2025 guidance. For Q3 2025, the company expects revenue of $207.0–$210.0 million (11%–12% YoY growth), non-GAAP income from operations of $31.2–$33.2 million, and non-GAAP net income per share of $0.12–$0.14. For full-year 2025, the company now expects revenue of $822.9–$828.9 million (14%–15% YoY growth, 14%–16% constant currency), non-GAAP income from operations of $153.0–$157.0 million, and non-GAAP net income per share of $0.56–$0.58. Guidance is based on exchange rates as of July 25, 2025.

FRSH YoY Financials

Q2 2025 vs Q2 2024 · SEC filings Q2 2024 Q2 2025
$0$60.0M$120.0M$180.0M$174.1M$204.7MRevenue$146.0M$173.5MGross Profit$-4,802,752$-8,656,000Operating Income$-908,663$-1,739,000Net Income
$0$60.0M$120.0M$180.0MRevenueGross ProfitOperating IncomeNet Income

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