Freshworks (Nasdaq: FRSH) turns Q2 2026 profit and raises 2026 outlook
Rhea-AI Filing Summary
Freshworks Inc. reported record second-quarter 2026 results, with revenue of $237.4 million, up 16% year over year, and its first GAAP-profitable quarter of 2026. GAAP income from operations was $6.1 million (2.6% margin) and GAAP net income was $3.2 million, or $0.01 per diluted share.
On a non-GAAP basis, income from operations rose to $55.9 million, a 23.6% margin, and diluted EPS was $0.17. Net cash provided by operating activities was $58.5 million and adjusted free cash flow was $57.7 million, with cash, cash equivalents, restricted cash and marketable securities totaling $665.3 million as of June 30, 2026.
The company continued to grow larger customers, with 1,746 accounts over $100,000 in ARR and a net dollar retention rate of 104%. Freshworks recorded $7.0 million of restructuring charges in the quarter tied to a May 2026 plan that is substantially complete. Management issued 2026 guidance for revenue of $963.5–$966.5 million and non-GAAP net income per share of $0.66–$0.68.
Positive
- Record Q2 revenue $237.4M, up 16% with first GAAP profit.
- Strong non-GAAP operating margin of 23.6% on $55.9M income.
- Robust liquidity with $665.3M in cash and marketable securities.
- 2026 guidance targets up to $966.5M revenue and higher profitability.
Negative
- None.
Filing Explained
At June 30, 2026, $1.4 million of restructuring costs remained accrued after $5.6 million was paid under the substantially complete plan.
Under Item 2.02, Freshworks furnished its second-quarter results exhibit; the information is expressly not deemed filed for Section 18 liability purposes.
As of
The remaining
8-K Event Classification
3 items: 2.02, 2.05, 9.01
3 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 2.05
Costs Associated with Exit or Disposal Activities
Financial
The company committed to an exit plan involving layoffs, facility closures, or restructuring charges.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Q2 2026 Revenue: $237.4 million
Revenue Growth: 16%
Q2 2026 GAAP Net Income: $3.2 million
+5 more
8 metrics
Q2 2026 Revenue
$237.4 million
Total revenue for the three months ended June 30, 2026
Revenue Growth
16%
Year-over-year revenue growth versus the second quarter of 2025
Q2 2026 GAAP Net Income
$3.2 million
Net income for the three months ended June 30, 2026
Non-GAAP Operating Margin Q2 2026
23.6%
Non-GAAP income from operations as a percentage of revenue
Net Cash from Operating Activities Q2 2026
$58.5 million
Net cash provided by operating activities in the quarter
Cash and Marketable Securities
$665.3 million
Cash, cash equivalents, restricted cash and marketable securities as of June 30, 2026
Restructuring Charges Q2 2026
$7.0 million
Charges primarily for employee severance under the May 2026 plan
2026 Revenue Guidance
$963.5–$966.5 million
Full year 2026 revenue outlook provided by management
Key Terms
Rule of 40, annual recurring revenue, net dollar retention rate, adjusted free cash flow, +1 more
5 terms
Rule of 40 financial
"its eighth consecutive quarter hitting Rule of 40, and a milestone"
The "rule of 40" is a simple guideline used by investors to assess the health of a company's growth and profitability. It adds a company's growth rate to its profit margin; if the total is 40% or higher, the company is generally considered to be performing well. This helps investors quickly gauge whether a company is balancing rapid growth with solid profits, much like checking if a car’s speed and fuel efficiency together are within a safe and efficient range.
annual recurring revenue financial
"We define ARR as the sum total of subscription, software license, and maintenance revenue"
Annual recurring revenue is the predictable amount of money a company expects to earn each year from ongoing customer subscriptions or contracts. It helps businesses understand how much steady income they can count on, much like a subscription service that charges customers every month or year. This figure is important because it shows the company's stability and growth potential.
net dollar retention rate financial
"Net dollar retention rate was 104%, compared to 106% in the first quarter"
Net dollar retention rate measures how much revenue a company keeps from its existing customers over a set period after accounting for additional sales to them, reduced spending, and customers who leave. It matters to investors because it shows whether a company’s customer base is growing in value or shrinking—like checking whether the same garden produces more or fewer fruits over time—which signals the health and sustainability of recurring revenue.
adjusted free cash flow financial
"Adjusted free cash flow was $57.7 million, representing an adjusted free cash flow margin"
Adjusted free cash flow is the amount of money a company generates from its operations after accounting for essential expenses and investments, like maintaining or upgrading equipment. It shows how much cash is truly available to grow the business, pay debts, or return to shareholders, helping investors see the company's financial health more clearly.
constant currency financial
"Revenue adjusted for constant currency to provide a framework for assessing performance"
Constant currency is a way of measuring financial results that removes the effects of changes in currency exchange rates. It allows for a clearer comparison of a company's performance over time by showing what the numbers would look like if exchange rates had stayed the same. This helps investors understand whether growth comes from actual business improvements or just currency fluctuations.
Earnings Snapshot
Revenue: $237.4 million · Guidance included
second quarter 2026
Revenue
$237.4 million
16% year-over-year growth versus $204.7 million in Q2 2025
GAAP net income
$3.2 million
improved from a $(1.7) million net loss in Q2 2025
Non-GAAP income from operations
$55.9 million
up from $44.8 million in the second quarter of 2025
Non-GAAP diluted EPS
$0.17
compared with $0.18 in the second quarter of 2025
Guidance
For Q3 2026, Freshworks expects revenue of $244.5–$245.5 million and non-GAAP income from operations of $59.0–$61.0 million. For full year 2026, it guides to $963.5–$966.5 million revenue, non-GAAP income from operations of $222.0–$228.0 million, and non-GAAP net income per share of $0.66–$0.68.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What were Freshworks (FRSH) Q2 2026 revenues and growth?
Freshworks generated $237.4 million in revenue in Q2 2026, representing 16% year-over-year growth versus $204.7 million in Q2 2025. Revenue growth was about 15% when adjusted for constant currency effects.
Did Freshworks (FRSH) achieve GAAP profitability in Q2 2026?
Yes. Freshworks posted GAAP net income of $3.2 million in Q2 2026, or $0.01 diluted EPS, compared with a GAAP net loss of $1.7 million and $(0.01) per share in the same quarter of 2025.
What is Freshworks (FRSH) outlook for full year 2026?
For 2026, Freshworks guides revenue to $963.5–$966.5 million, implying about 15% year-over-year growth. It expects non-GAAP income from operations of $222.0–$228.0 million and non-GAAP net income per share of $0.66–$0.68.
How strong is Freshworks (FRSH) cash and liquidity position?
As of June 30, 2026, Freshworks held $665.3 million in cash, cash equivalents, restricted cash and marketable securities. Q2 2026 net cash provided by operating activities was $58.5 million, and adjusted free cash flow was $57.7 million, indicating solid liquidity.
What restructuring charges did Freshworks (FRSH) record in Q2 2026?
Freshworks recognized $7.0 million in restructuring charges in Q2 2026, mainly for employee severance and benefits under a May 2026 plan. It paid $5.6 million during the quarter, leaving a $1.4 million accrued restructuring liability as of June 30, 2026.
How are larger customers and net dollar retention trending at Freshworks (FRSH)?
Customers with more than $100,000 in ARR reached 1,746, up 25% year over year. Net dollar retention was 104% in Q2 2026, or 105% on a constant-currency basis, reflecting expansion from existing customers despite some moderation.
What were Freshworks (FRSH) key non-GAAP profitability metrics in Q2 2026?
Non-GAAP income from operations was $55.9 million, yielding a 23.6% non-GAAP operating margin, up from 21.9% a year earlier. Non-GAAP diluted net income per share was $0.17, compared with $0.18 in Q2 2025 on a higher share count then.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 4, 2026
(Exact name of Registrant as Specified in Its Charter)
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of Principal Executive Offices and Zip Code)
(650 ) 513-0514
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On August 4, 2026, Freshworks Inc. issued a press release announcing its financial results for the second quarter ended June 30, 2026. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The foregoing information (including Exhibit 99.1 hereto) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, regardless of any general incorporation language in such filings, except as shall be expressly set forth by specific reference in such filing.
Item 2.05 Costs Associated with Exit or Disposal Activities.
In May 2026, the Company announced a restructuring plan (the Plan) to streamline the Company’s organizational efforts and product development process, as well as increase leverage of AI and automation across the business. During the three and six months ended June 30, 2026, we recognized $7.0 million in restructuring charges primarily associated with employee severance and benefit costs, in our condensed consolidated statements of operations. During the three and six months ended June 30, 2026, we paid $5.6 million of the restructuring costs, resulting in an unpaid restructuring liability of $1.4 million as of June 30, 2026, which is included in accrued liabilities in our condensed consolidated balance sheets. The Plan is substantially complete as of June 30, 2026, and the Company does not expect to incur any additional material charges.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description | |||||||
| 99.1 | Press Release dated August 4, 2026 | |||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
1
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Freshworks Inc. | ||||||||
Dated: August 4, 2026 | ||||||||
| By: | /s/ Tyler Sloat | |||||||
| Tyler Sloat | ||||||||
| Chief Operating Officer and Chief Financial Officer (Principal Financial Officer) | ||||||||
2
Freshworks Reports Record Second Quarter 2026 Results
Beats revenue and profitability expectations, raises full year estimates
•Total revenues of $237.4 million, representing 16% year-over-year growth
•Positive GAAP Net Income of $3.2 million, representing the Company’s first quarter of GAAP profitability in 2026
•Achieved the 8th consecutive quarter of Rule of 40 demonstrating consistent growth and profitability
San Mateo, Calif. – August 4, 2026 – Freshworks Inc. (Nasdaq: FRSH), today announced financial results for its second quarter ended June 30, 2026.
"Freshworks just delivered its seventh straight quarter beating revenue estimates, its eighth consecutive quarter hitting Rule of 40, and a milestone we said we'd hit - GAAP profitability, months ahead of plan. This isn't just a moment, this has been a pattern of execution," stated Dennis Woodside, CEO & President of Freshworks. "EX ARR grew 24% year-over-year, and Freddy AI Copilot is now attached to over 71% of new enterprise deals. Customers aren't testing AI with us, they’re adopting and using Freddy AI. We built a platform for the mid-market and agile enterprise that we believe no one else can match, and we're demonstrating you can grow fast, stay disciplined, and be profitable all at the same time. This is what a durable, category-defining business should look like."
Second Quarter 2026 Financial Summary Results
•Revenue: Total revenue was $237.4 million, representing growth of 16% compared to total revenue of $204.7 million in the second quarter of 2025, and 15% adjusting for constant currency.
•GAAP Income (Loss) from Operations: GAAP income (loss) from operations was $6.1 million, representing an operating margin of 2.6%, compared to $(8.7) million, representing an operating margin of (4.2)%, in the second quarter of 2025.
•Non-GAAP Income from Operations: Non-GAAP income from operations was $55.9 million, representing a non-GAAP operating margin of 23.6%, compared to $44.8 million, representing a non-GAAP operating margin of 21.9%, in the second quarter of 2025.
•GAAP Net Income (Loss) Per Share: GAAP diluted net income (loss) per share was $0.01 based on 273.0 million weighted-average shares outstanding, compared to $(0.01) based on 294.4 million weighted-average shares outstanding in the second quarter of 2025.
•Non-GAAP Net Income Per Share: Non-GAAP diluted net income per share was $0.17 based on 273.0 million weighted-average shares outstanding, compared to $0.18 based on 297.3 million weighted-average shares outstanding in the second quarter of 2025.
•Net Cash Provided by Operating Activities: Net cash provided by operating activities was $58.5 million, representing an operating cash flow margin of 24.7%, compared to $58.6 million, representing an operating cash flow margin of 28.6%, in the second quarter of 2025.
•Adjusted Free Cash Flow: Adjusted free cash flow was $57.7 million, representing an adjusted free cash flow margin of 24.3%, compared to $54.3 million, representing an adjusted free cash flow margin of 26.5%, in the second quarter of 2025 .
•Cash, Cash Equivalents, Restricted Cash and Marketable Securities: Cash, cash equivalents, restricted cash and marketable securities were $665.3 million as of June 30, 2026.
All financial numbers for 2026 include the results of our FireHydrant business. A description of non-GAAP financial measures is contained in the section titled “Explanation of Non-GAAP Financial Measures” below and a reconciliation of GAAP to non-GAAP financial measures is detailed in the tables below.
Second Quarter Metrics and Recent Business Highlights
•Number of customers contributing more than $100,000 in ARR was 1,746, an increase of 25% year-over-year and 26% adjusting for constant currency.
•Number of customers contributing more than $50,000 in ARR was 4,091, an increase of 18% year-over-year and 19% adjusting for constant currency.
•Number of customers contributing more than $5,000 in ARR was 25,356, an increase of 6% year-over-year and 6% adjusting for constant currency.
•Net dollar retention rate was 104%, compared to 106% in the first quarter of 2026 and 106% in the second quarter of 2025. Adjusted for constant currency, net dollar retention rate was 105%, compared to 105% in the first quarter of 2026 and 104% in the second quarter of 2025.
•Announced AI Agent Studio and MCP Gateway for Freshservice.
•Welcomed and onboarded many new customers to the Freshworks community including Van Marcke, Hydrite Chemical, Simpar, Upland Software, Paddle, and Open Health Communications.
•Appoints Ryan Manning as Chief Product and Technology Officer.
•Named a Leader in the 2026 Gartner® Magic Quadrant™ for IT Service Management Platforms.
Financial Outlook
We are providing estimates for the third quarter and for the full year 2026. We emphasize that these estimates are subject to various important cautionary factors referenced in the section entitled “Forward-Looking Statements” below.
For the third quarter and full year 2026, we currently expect the following results:
| ($ in millions, except per share data) | Third Quarter 2026 | Full Year 2026 | ||||||
Revenue(1) | $244.5 - $245.5 | $963.5 - $966.5 | ||||||
| Year-over-year growth | ~14% | ~15% | ||||||
| Year-over-year growth (constant currency) | 14% - 15% | 14% - 15% | ||||||
Non-GAAP income from operations(1) | $59.0 - $61.0 | $222.0 - $228.0 | ||||||
Non-GAAP net income per share(2) | $0.18 | $0.66 - $0.68 | ||||||
(1) Revenue and non-GAAP income from operations are based on exchange rates as of August 1, 2026 for currencies other than USD.
(2) Non-GAAP net income per share was estimated assuming 265.8 million and 272.8 million weighted-average shares outstanding for the third quarter and full year 2026, respectively.
These statements are forward-looking and actual results may differ materially. Refer to the “Forward-Looking Statements” safe harbor section below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.
We have not reconciled our third quarter and full year 2026 estimates for non-GAAP financial measures to GAAP due to the uncertainty and potential variability of expenses that may be incurred in the future. Accordingly, a reconciliation is not available without unreasonable effort and we are unable to address the probable significance of the unavailable information. We have provided a reconciliation of other GAAP to non-GAAP financial measures in the financial statement tables for our second quarter 2026 and 2025 non-GAAP results included in this press release.
Webcast and Conference Call Information
We will host a conference call for investors on August 4, 2026 at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time to discuss the Company’s financial results and business highlights. Investors are invited to listen to a live audio webcast of the conference call by visiting the investor relations website at ir.freshworks.com. A replay of the audio webcast will be available shortly after the call on the Freshworks Investor Relations website and will be available for twelve months thereafter.
Explanation of Non-GAAP Financial Measures
In addition to financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), this press release and the accompanying tables contain non-GAAP financial measures, including revenue adjusted for constant currency, non-GAAP gross profit, non-GAAP gross margin, non-GAAP sales and marketing expense, non-GAAP research and development expense, non-GAAP general and administrative expense, non-GAAP income from operations, non-GAAP operating margin, non-GAAP net income per share, non-GAAP net income, adjusted free cash flow, and adjusted free cash flow margin. This press release and the accompanying tables also contain certain other metrics, including annual recurring revenue, net dollar retention rates, revenue growth rates, and related presentation thereof adjusted for constant currency.
We adjust revenue and related growth rates for constant currency to provide a framework for assessing business performance excluding the effect of foreign currency rate fluctuations. To present this information, current period results for currencies other than USD are converted into USD at the average exchange rates in effect during the comparison period (for Q2 2025, the average exchange rates in effect for our major currencies were 1 EUR to 1.05 USD and 1 GBP to 1.26 USD), rather than the actual average exchange rates in effect during the current period (for Q2 2026, the average exchange rates in effect for our major currencies were 1 EUR to 1.16 USD and 1 GBP to 1.34 USD).
We use these non-GAAP measures in conjunction with GAAP measures as part of our overall assessment of our performance, including the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies and to communicate with our board of directors concerning our financial performance. We believe these non-GAAP measures provide investors consistency and comparability with our past financial performance and facilitate period-to-period comparisons of our operating results. We believe these non-GAAP measures are useful in evaluating our operating performance compared to that of other companies in our industry, as they generally eliminate the effects of certain items that may vary for different companies for reasons unrelated to overall operating performance.
Investors, however, are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool. The non-GAAP measures we use may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes. We compensate for these limitations by providing specific information regarding the GAAP items excluded from these non-GAAP financial measures.
We exclude the following items from one or more of our non-GAAP financial measures:
•Stock-based compensation expense. We exclude stock-based compensation, which is a non-cash expense, from certain of our non-GAAP financial measures because we believe that excluding this expense provides meaningful supplemental information regarding operational performance. In particular, stock-based compensation expense is not comparable across companies given the variety of valuation methodologies and assumptions.
•Employer payroll taxes on employee stock transactions. We exclude the amount of employer payroll taxes on equity awards from certain of our non-GAAP financial measures because they are dependent on our stock price at the time of vesting or exercise and other factors that are beyond our control and do not believe these expenses have a direct correlation to the operation of our business.
•Amortization of acquired intangibles. We exclude amortization of acquired intangibles, which is a non-cash expense, from certain of our non-GAAP financial measures. Our expenses for amortization of acquired intangibles are inconsistent in amount and frequency because they are significantly affected by the timing, size of acquisitions, and the allocation of purchase price. We exclude these amortization expenses because we do not believe these expenses have a direct correlation to the operation of our business.
•Restructuring charges. We exclude restructuring charges, which primarily consists of employee severance and other employee termination benefits associated with the restructuring program initiated in November 2024 and May 2026, from our non-GAAP financial measures, because we do not believe these expenses have a direct correlation to the operating performance of our business.
•Acquisition expenses. We exclude acquisition expenses, which primarily consist of legal fees and due diligence costs, from our non-GAAP financial measures because we do not believe these expenses have a direct correlation to the operating performance of our business.
•Income tax effect and adjustments. Starting January 1, 2026, we utilize a long-term projected non-GAAP tax rate to compute our non-GAAP income tax provision in order to provide better consistency across interim reporting periods. Our non-GAAP tax rate reflects our estimated long-term effective tax rate based on our anticipated geographic earnings mix and statutory tax regimes. For fiscal year 2026, we determined the projected non-GAAP tax rate to be 24%. The difference between our GAAP income tax provision and our non-GAAP income tax provision is presented as non-GAAP income tax reconciling adjustments. Prior to 2026, we excluded the income tax effect of the above adjustments, income tax effect associated with acquisitions and tax charges or benefits that are a result of a change in valuation allowance on deferred tax assets and its related impacts, from our non-GAAP financial measures. We excluded these costs because we do not believe these expenses have a direct correlation to the operating performance of our business.
We define adjusted free cash flow as net cash provided by operating activities, less purchases of property and equipment, capitalized internal-use software, plus acquisition costs and restructuring charges. We believe that adjusted free cash flow is a useful indicator of liquidity as it measures our ability to generate cash from our core operations after purchases of property and equipment. Adjusted free cash flow is a measure to determine, among other things, cash available for strategic initiatives, including further investments in our business and potential acquisitions of businesses. We define adjusted free cash flow margin as adjusted free cash flow as a percentage of revenue. We believe that adjusted free cash flow margin is a useful indicator of how efficiently we convert revenue into adjusted free cash flow.
Operating Metrics
Number of Customers Contributing More Than $5,000, $50,000 and $100,000 in ARR. We define ARR as the sum total of subscription, software license, and maintenance revenue we would contractually expect to recognize over the next 12 months from all customers at a point in time, assuming no increases, reductions or cancellations in their subscriptions, and assuming that revenues are recognized ratably over the term of subscription and maintenance contracts and upon delivery for software licenses. We define our total customers contributing more than $5,000, $50,000 and $100,000 in ARR as of a particular date as the number of business entities or individuals, represented by a unique domain or a unique email address, with one or more paid subscriptions to one or more of our products that contributed ARR above the applicable threshold.
Net Dollar Retention Rate. To calculate net dollar retention rate as of a given date, we first determine Entering ARR, which is ARR from the population of our customers as of 12 months prior to the end of the reporting period. We then calculate the Ending ARR from the same set of customers as of the end of the reporting period. We then divide the Ending ARR by the Entering ARR to arrive at our net dollar retention rate. Ending ARR includes upsells, cross-sells, renewals and expansion as a result of acquisitions during the measurement period and is net of any contraction or attrition over this period.
We also adjust the above operating metrics, growth rates of customers contributing more than $5,000, $50,000 and $100,000 in ARR and related presentation thereof for constant currency to provide a framework for assessing our business performance excluding the effects of foreign currency rates fluctuations. To present this information, the Ending ARR of the current period in currencies other than USD is converted into USD at the exchange rates in effect at the end of the comparison period (for Q2 2025, the period end exchange rates in effect for our major currencies were 1 EUR to 1.17 USD and 1 GBP to 1.37 USD), rather than the actual exchange rates in effect at the end of the current period (for Q2 2026, the period end exchange rates in effect for our major currencies were 1 EUR to 1.14 USD and 1 GBP to 1.32 USD).
Forward-Looking Statements
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to, among other things, our GAAP and non-GAAP estimates for the third quarter and full year 2026, our financial outlook, our ability to sustain profitability, and our expectations regarding impact of new product capabilities and our AI-powered software. These forward-looking statements are based on our current expectations, estimates and projections about our business and industry, including our financial outlook and macroeconomic uncertainties, management’s beliefs and certain assumptions made by the company, all of which are subject to change. Forward-looking statements generally can be identified by the use of forward-looking terminology such as, “future,” “believe,” “expectation,” “may,” “will,” “outlook,” “estimate,” “continue,” “anticipate,” “could,” “would,” or similar expressions or the negative of those terms or expressions. Such statements involve risks and uncertainties, many of which involve factors or circumstances that are beyond our control, which could cause actual results to vary materially from those expressed in or indicated by the forward-looking statements. Factors that may cause actual results to differ materially include our ability to achieve our long-term plans and key initiatives; our ability to sustain or manage any future growth and profitability effectively; our ability to attract and retain customers or expand sales to existing customers; delays in product development or deployments or the success of such products; the impact to the economy, our customers and our business due to uncertain global economic conditions, including market volatility, foreign exchange rates, and impact of inflation, as well as the other potential factors described under “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2025 as such factors may be updated from time to time in our periodic and other documents of Freshworks Inc. filed with the Securities and Exchange Commission from time to time (available at www.sec.gov).
We caution you not to place undue reliance on forward-looking statements, which speak only as of the date hereof and are based on information available to us at the time the statements are made and/or management’s good faith
belief as of that time with respect to future events. We assume no obligation to update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release, except as required by law.
About Freshworks Inc.
Freshworks is the AI-powered, unified service operations platform that is fast to deploy, intuitive to use, and enables every employee to be more productive. We offer powerful governance and scale, without the operational drag of legacy platforms. Organizations including Bridgestone, New Balance, S&P Global, and Sony Music trust Freshworks to deliver quality employee and customer service and manage efficient technology operations. For the latest updates, visit freshworks.com and follow Freshworks on LinkedIn, X, and Facebook.
© 2026 Freshworks Inc. All Rights Reserved. Freshworks, Freshservice and any associated logo are trademarks of Freshworks Inc. All other company, brand and product names may be trademarks or registered trademarks of their respective companies. Nothing in this press release should be construed to the contrary, or as an approval, endorsement or sponsorship by any third parties of Freshworks Inc. or any aspect of this press release.
Gartner Source Citation
Gartner, Magic Quadrant for IT Service Management Platforms, Rich Doheny, Ankita Hundal, et al., 27 July 2026
Gartner Disclaimer
Gartner does not endorse any vendor, product or service depicted in our research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s business and technology insights research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose. GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally, and MAGIC QUADRANT is a registered trademark of Gartner, Inc. and/or its affiliates and are used herein with permission. All rights reserved. The Gartner content described herein (the “Gartner Content”) represents research opinion or viewpoints published, as part of a syndicated subscription service, by Gartner, Inc. (“Gartner”), and is not a representation of fact. Gartner Content speaks as of its original publication date and not as of the date of this press release, and the opinions expressed in the Gartner Content are subject to change without notice.
Investor Relations Contact:
IR@freshworks.com
Media Relations Contact:
PR@freshworks.com
FRESHWORKS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Revenue | $ | 237,377 | $ | 204,678 | $ | 466,010 | $ | 400,951 | |||||||||||||||
Cost of revenue(1) | 36,096 | 31,142 | 70,784 | 61,020 | |||||||||||||||||||
| Gross profit | 201,281 | 173,536 | 395,226 | 339,931 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
Research and development(1) | 43,815 | 39,943 | 93,076 | 79,944 | |||||||||||||||||||
Sales and marketing(1) | 106,450 | 95,223 | 218,767 | 184,381 | |||||||||||||||||||
General and administrative(1) | 37,924 | 47,026 | 78,351 | 94,273 | |||||||||||||||||||
| Restructuring charges | 7,032 | — | 7,032 | 405 | |||||||||||||||||||
| Total operating expenses | 195,221 | 182,192 | 397,226 | 359,003 | |||||||||||||||||||
| Income (loss) from operations | 6,060 | (8,656) | (2,000) | (19,072) | |||||||||||||||||||
| Interest and other income, net | 4,204 | 12,547 | 5,630 | 25,516 | |||||||||||||||||||
| Income before income taxes | 10,264 | 3,891 | 3,630 | 6,444 | |||||||||||||||||||
| Provision for income taxes | 7,025 | 5,630 | 5,201 | 9,487 | |||||||||||||||||||
| Net income (loss) | 3,239 | (1,739) | (1,571) | (3,043) | |||||||||||||||||||
| Weighted-average shares used in calculating net income (loss) per share: | |||||||||||||||||||||||
| Basic | 271,951 | 294,435 | 277,612 | 297,839 | |||||||||||||||||||
| Diluted | 272,988 | 294,435 | 277,612 | 297,839 | |||||||||||||||||||
| Net income (loss) per share - basic and diluted | |||||||||||||||||||||||
Basic | $ | 0.01 | $ | (0.01) | $ | (0.01) | $ | (0.01) | |||||||||||||||
Diluted | $ | 0.01 | $ | (0.01) | $ | (0.01) | $ | (0.01) | |||||||||||||||
______________________
(1) Includes stock-based compensation expense as follows (in thousands):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Cost of revenue | $ | 1,636 | $ | 1,437 | $ | 3,254 | $ | 2,955 | |||||||||||||||
| Research and development | 8,956 | 8,618 | 21,257 | 17,831 | |||||||||||||||||||
| Sales and marketing | 11,088 | 11,819 | 24,088 | 25,228 | |||||||||||||||||||
General and administrative | 16,168 | 27,406 | 33,170 | 54,930 | |||||||||||||||||||
| Total stock-based compensation expense, net of amounts capitalized | $ | 37,848 | $ | 49,280 | $ | 81,769 | $ | 100,944 | |||||||||||||||
FRESHWORKS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
| June 30, 2026 | December 31, 2025 | ||||||||||
| (unaudited) | |||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 494,665 | $ | 569,774 | |||||||
| Restricted cash | 1,154 | 62,374 | |||||||||
| Marketable securities | 169,442 | 211,597 | |||||||||
| Accounts receivable, net | 137,678 | 150,817 | |||||||||
| Deferred contract acquisition costs | 32,105 | 29,830 | |||||||||
| Prepaid expenses and other current assets | 66,866 | 72,774 | |||||||||
| Total current assets | 901,910 | 1,097,166 | |||||||||
| Property and equipment, net | 46,387 | 38,843 | |||||||||
| Operating lease right-of-use assets | 32,264 | 39,893 | |||||||||
| Deferred contract acquisition costs, noncurrent | 28,661 | 27,179 | |||||||||
| Goodwill | 198,010 | 146,676 | |||||||||
| Intangible assets, net | 92,473 | 76,986 | |||||||||
Deferred tax assets, net | 174,047 | 157,466 | |||||||||
| Other assets | 16,716 | 18,503 | |||||||||
| Total assets | $ | 1,490,468 | $ | 1,602,712 | |||||||
| Liabilities and Stockholders' Equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 26,902 | $ | 11,507 | |||||||
| Accrued liabilities | 105,290 | 101,202 | |||||||||
| Deferred revenue | 400,469 | 385,320 | |||||||||
| Total current liabilities | 532,661 | 498,029 | |||||||||
| Operating lease liabilities, non-current | 25,565 | 33,282 | |||||||||
| Other liabilities | 36,299 | 38,751 | |||||||||
| Total liabilities | 594,525 | 570,062 | |||||||||
| Stockholders' equity: | |||||||||||
| Common stock | 3 | 3 | |||||||||
| Additional paid-in capital | 4,451,395 | 4,586,392 | |||||||||
Accumulated other comprehensive loss | (1,730) | (1,591) | |||||||||
| Accumulated deficit | (3,553,725) | (3,552,154) | |||||||||
| Total stockholders' equity | 895,943 | 1,032,650 | |||||||||
| Total liabilities and stockholders' equity | $ | 1,490,468 | $ | 1,602,712 | |||||||
FRESHWORKS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Cash Flows from Operating Activities: | |||||||||||||||||||||||
Net income (loss) | $ | 3,239 | $ | (1,739) | $ | (1,571) | $ | (3,043) | |||||||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||||||||||||||
| Depreciation and amortization | 8,263 | 6,281 | 16,126 | 12,641 | |||||||||||||||||||
| Amortization of deferred contract acquisition costs | 8,966 | 7,848 | 17,533 | 15,431 | |||||||||||||||||||
| Non-cash lease expense | 2,683 | 2,320 | 5,608 | 4,623 | |||||||||||||||||||
| Stock-based compensation | 37,849 | 49,280 | 81,770 | 100,944 | |||||||||||||||||||
Discount amortization on marketable securities | (297) | (1,793) | (1,244) | (3,694) | |||||||||||||||||||
| Deferred income taxes | 3,224 | — | (2,641) | (459) | |||||||||||||||||||
| Other | 1,582 | 487 | 9,390 | 470 | |||||||||||||||||||
| Changes in operating assets and liabilities: | |||||||||||||||||||||||
| Accounts receivable | (10,340) | (3,613) | 14,577 | 6,981 | |||||||||||||||||||
| Deferred contract acquisition costs | (11,093) | (10,054) | (21,290) | (18,758) | |||||||||||||||||||
| Prepaid expenses and other assets | 2,295 | (7,372) | (10,269) | (22,689) | |||||||||||||||||||
| Accounts payable | 8,674 | 2,754 | 15,568 | 3,280 | |||||||||||||||||||
| Accrued and other liabilities | (2,307) | 8,309 | (5,749) | 7,813 | |||||||||||||||||||
| Deferred revenue | 8,429 | 8,390 | 9,456 | 15,439 | |||||||||||||||||||
| Operating lease liabilities | (2,644) | (2,507) | (6,352) | (2,415) | |||||||||||||||||||
Net cash provided by operating activities | 58,523 | 58,591 | 120,912 | 116,564 | |||||||||||||||||||
| Cash Flows from Investing Activities: | |||||||||||||||||||||||
| Purchases of property and equipment | (5,041) | (380) | (8,942) | (1,676) | |||||||||||||||||||
| Proceeds from sale of property and equipment | 3 | 2 | 8 | 40 | |||||||||||||||||||
| Capitalized internal-use software | (1,471) | (4,676) | (4,850) | (7,448) | |||||||||||||||||||
| Purchases of marketable securities | (126,404) | (225,273) | (273,825) | (347,206) | |||||||||||||||||||
| Maturities and redemptions of marketable securities | 187,545 | 187,485 | 316,896 | 359,679 | |||||||||||||||||||
| Business combination, net of cash acquired | — | — | (56,913) | — | |||||||||||||||||||
Net cash provided by (used in) investing activities | 54,632 | (42,842) | (27,626) | 3,389 | |||||||||||||||||||
| Cash Flows from Financing Activities: | |||||||||||||||||||||||
| Proceeds from issuance of common stock under employee stock purchase plan, net | 3,061 | 3,307 | 3,061 | 3,307 | |||||||||||||||||||
| Proceeds from exercise of stock options | 2 | 14 | 2 | 62 | |||||||||||||||||||
| Payment of withholding taxes on net share settlement of equity awards | (9,826) | (13,749) | (16,986) | (30,460) | |||||||||||||||||||
Repurchase of common stock | (159,042) | (113,586) | (207,411) | (227,196) | |||||||||||||||||||
| Net cash used in financing activities | (165,805) | (124,014) | (221,334) | (254,287) | |||||||||||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (862) | — | (8,383) | — | |||||||||||||||||||
Net decrease in cash, cash equivalents and restricted cash | (53,512) | (108,265) | (136,431) | (134,334) | |||||||||||||||||||
| Cash, cash equivalents and restricted cash, beginning of period | 549,331 | 594,336 | 632,250 | 620,405 | |||||||||||||||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 495,819 | $ | 486,071 | $ | 495,819 | $ | 486,071 | |||||||||||||||
FRESHWORKS INC.
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(in thousands, except percentages and per share data)
(unaudited)
| Three Months Ended June 30, | |||||||||||||||||
| 2026 | 2025 | Growth Rates | |||||||||||||||
| Revenue | |||||||||||||||||
| GAAP revenue | $ | 237,377 | $ | 204,678 | 16% | ||||||||||||
| Effects of foreign currency rate fluctuations | $ | (1,466) | |||||||||||||||
| Revenue adjusted for constant currency | $ | 235,911 | $ | 204,678 | 15% | ||||||||||||
FRESHWORKS INC.
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(in thousands, except percentages and per share data)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Reconciliation of gross profit and gross margin: | |||||||||||||||||||||||
| GAAP gross profit | $ | 201,281 | $ | 173,536 | $ | 395,226 | $ | 339,931 | |||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||
| Stock-based compensation expense | 1,636 | 1,437 | 3,254 | 2,955 | |||||||||||||||||||
| Employer payroll taxes on employee stock transactions | 27 | 30 | 56 | 57 | |||||||||||||||||||
| Amortization of acquired intangibles | 1,655 | 1,275 | 3,292 | 2,536 | |||||||||||||||||||
| Non-GAAP gross profit | $ | 204,599 | $ | 176,278 | $ | 401,828 | $ | 345,479 | |||||||||||||||
| GAAP gross margin | 84.8 | % | 84.8 | % | 84.8 | % | 84.8 | % | |||||||||||||||
| Non-GAAP gross margin | 86.2 | % | 86.1 | % | 86.2 | % | 86.2 | % | |||||||||||||||
| Reconciliation of operating expenses: | |||||||||||||||||||||||
| GAAP research and development | $ | 43,815 | $ | 39,943 | $ | 93,076 | $ | 79,944 | |||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||
| Stock-based compensation expense | (8,956) | (8,618) | (21,257) | (17,831) | |||||||||||||||||||
| Employer payroll taxes on employee stock transactions | (104) | (57) | (217) | (209) | |||||||||||||||||||
| Non-GAAP research and development | $ | 34,755 | $ | 31,268 | $ | 71,602 | $ | 61,904 | |||||||||||||||
| GAAP research and development as percentage of revenue | 18.5 | % | 19.5 | % | 20.0 | % | 19.9 | % | |||||||||||||||
| Non-GAAP research and development as percentage of revenue | 14.6 | % | 15.3 | % | 15.4 | % | 15.4 | % | |||||||||||||||
| GAAP sales and marketing | $ | 106,450 | $ | 95,223 | $ | 218,767 | $ | 184,381 | |||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||
| Stock-based compensation expense | (11,088) | (11,819) | (24,088) | (25,228) | |||||||||||||||||||
| Employer payroll taxes on employee stock transactions | (402) | (372) | (792) | (934) | |||||||||||||||||||
| Amortization of acquired intangibles | (2,574) | (2,233) | (5,120) | (4,486) | |||||||||||||||||||
| Non-GAAP sales and marketing | $ | 92,386 | $ | 80,799 | $ | 188,767 | $ | 153,733 | |||||||||||||||
| GAAP sales and marketing as percentage of revenue | 44.8 | % | 46.5 | % | 46.9 | % | 46.0 | % | |||||||||||||||
| Non-GAAP sales and marketing as percentage of revenue | 38.9 | % | 39.5 | % | 40.5 | % | 38.3 | % | |||||||||||||||
| GAAP general and administrative | $ | 37,924 | $ | 47,026 | $ | 78,351 | $ | 94,273 | |||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||
| Stock-based compensation expense | (16,168) | (27,406) | (33,170) | (54,930) | |||||||||||||||||||
| Employer payroll taxes on employee stock transactions | (188) | (243) | (413) | (701) | |||||||||||||||||||
| Acquisition expense | (38) | — | (193) | — | |||||||||||||||||||
| Non-GAAP general and administrative | $ | 21,530 | $ | 19,377 | $ | 44,575 | $ | 38,642 | |||||||||||||||
| GAAP general and administrative as percentage of revenue | 16.0 | % | 23.0 | % | 16.8 | % | 23.5 | % | |||||||||||||||
| Non-GAAP general and administrative as percentage of revenue | 9.1 | % | 9.5 | % | 9.6 | % | 9.6 | % | |||||||||||||||
FRESHWORKS INC.
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(in thousands, except percentages and per share data)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Reconciliation of operating income (loss) and operating margin: | |||||||||||||||||||||||
| GAAP income (loss) from operations | $ | 6,060 | $ | (8,656) | $ | (2,000) | $ | (19,072) | |||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||
| Stock-based compensation expense | 37,848 | 49,280 | 81,769 | 100,944 | |||||||||||||||||||
| Employer payroll taxes on employee stock transactions | 721 | 702 | 1,478 | 1,901 | |||||||||||||||||||
| Amortization of acquired intangibles | 4,229 | 3,508 | 8,412 | 7,022 | |||||||||||||||||||
Restructuring charges | 7,032 | — | 7,032 | 405 | |||||||||||||||||||
| Acquisition expense | 38 | — | 193 | — | |||||||||||||||||||
Non-GAAP income from operations | 55,928 | 44,834 | 96,884 | 91,200 | |||||||||||||||||||
| GAAP operating margin | 2.6 | % | (4.2) | % | (0.4) | % | (4.8) | % | |||||||||||||||
| Non-GAAP operating margin | 23.6 | % | 21.9 | % | 20.8 | % | 22.7 | % | |||||||||||||||
| Reconciliation of net income (loss): | |||||||||||||||||||||||
| GAAP net income (loss) | $ | 3,239 | $ | (1,739) | $ | (1,571) | $ | (3,043) | |||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||
| Stock-based compensation expense | 37,848 | 49,280 | 81,769 | 100,944 | |||||||||||||||||||
| Employer payroll taxes on employee stock transactions | 721 | 702 | 1,478 | 1,901 | |||||||||||||||||||
| Amortization of acquired intangibles | 4,229 | 3,508 | 8,412 | 7,022 | |||||||||||||||||||
Restructuring charges | 7,032 | — | 7,032 | 405 | |||||||||||||||||||
| Acquisition expense | 38 | — | 193 | — | |||||||||||||||||||
Income tax adjustments | (7,407) | 782 | (19,403) | 1,192 | |||||||||||||||||||
Non-GAAP net income | $ | 45,700 | $ | 52,533 | $ | 77,910 | $ | 108,421 | |||||||||||||||
| Reconciliation of net income (loss) per share - diluted: | |||||||||||||||||||||||
| GAAP net income (loss) per share - diluted | $ | 0.01 | $ | (0.01) | $ | (0.01) | $ | (0.01) | |||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||
| Stock-based compensation expense | 0.14 | 0.17 | 0.29 | 0.34 | |||||||||||||||||||
| Employer payroll taxes on employee stock transactions | — | 0.01 | 0.01 | 0.01 | |||||||||||||||||||
| Amortization of acquired intangibles | 0.02 | 0.01 | 0.03 | 0.02 | |||||||||||||||||||
Restructuring charges | 0.03 | — | 0.03 | — | |||||||||||||||||||
| Acquisition expense | — | — | — | — | |||||||||||||||||||
Income tax adjustments | (0.03) | — | (0.07) | — | |||||||||||||||||||
Non-GAAP net income per share - diluted | $ | 0.17 | $ | 0.18 | $ | 0.28 | $ | 0.36 | |||||||||||||||
| Weighted-average shares used in computing GAAP net income (loss) per share - diluted | 272,988 | 294,435 | 277,612 | 297,839 | |||||||||||||||||||
Weighted-average shares used in computing non-GAAP net income (loss) per share - diluted (1) | 272,988 | 297,254 | 278,623 | 301,913 | |||||||||||||||||||
FRESHWORKS INC.
RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES
(in thousands, except percentages and per share data)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
Computation of adjusted free cash flow: | |||||||||||||||||||||||
Net cash provided by operating activities | $ | 58,523 | $ | 58,591 | $ | 120,912 | $ | 116,564 | |||||||||||||||
| Less: | |||||||||||||||||||||||
| Purchases of property and equipment | (5,041) | (380) | (8,942) | (1,676) | |||||||||||||||||||
| Capitalized internal-use software | (1,471) | (4,676) | (4,850) | (7,448) | |||||||||||||||||||
Add: | |||||||||||||||||||||||
| Acquisition and restructuring costs paid | 5,648 | 728 | 6,367 | 2,221 | |||||||||||||||||||
Adjusted free cash flow | $ | 57,659 | $ | 54,263 | $ | 113,487 | $ | 109,661 | |||||||||||||||
Operating cash flow margin | 24.7 | % | 28.6 | % | 25.9 | % | 29.1 | % | |||||||||||||||
Adjusted free cash flow margin | 24.3 | % | 26.5 | % | 24.4 | % | 27.4 | % | |||||||||||||||
Net cash provided by (used in) investing activities | $ | 54,632 | $ | (42,842) | $ | (27,626) | $ | 3,389 | |||||||||||||||
| Net cash used in financing activities | $ | (165,805) | $ | (124,014) | $ | (221,334) | $ | (254,287) | |||||||||||||||
(1) Diluted net income (loss) per share attributable to common stockholders is determined by giving effect to all potential common equivalents during the reporting period, unless including them yields an antidilutive result. The company considers its stock options and RSUs as potential common stock equivalents but excluded them from the computation of GAAP diluted net income (loss) per share attributable to common stockholders, as their effect was antidilutive. For the three months ended June 30, 2026 and 2025, potentially dilutive shares of 1.0 million and 2.8 million shares, respectively, were included in the weighted average shares used in computing non-GAAP diluted net income per share. For the six months ended June 30, 2026 and 2025, potentially dilutive shares of 1.0 million and 4.1 million shares, respectively, were included in the weighted average shares used in computing non-GAAP diluted net income per share.