Freshworks Inc. is a California-based SaaS company that provides customer engagement software for businesses of all sizes. Its cloud-based suite includes solutions for customer support, CRM, IT service management, and marketing automation. Freshworks is best known for products like Freshdesk (customer support), Freshservice (ITSM), and Freshsales (CRM). The company primarily targets mid-market and SMB customers, positioning itself as a simpler and more affordable alternative to Salesforce, Zendesk, and ServiceNow. As of 2025, Freshworks continues to expand its AI capabilities and global footprint, with over 65,000 customers.
Most Recent Earnings: Q2 2025 (Reported July 30, 2025)
Freshworks reported its Q2 FY2025 results on July 30, 2025. The company delivered EPS of $0.10, beating consensus estimates of $0.08. Revenue came in at $170.1 million, representing a 16% year-over-year growth and surpassing analyst expectations of $167.5 million. Subscription revenue, which makes up the bulk of total revenue, also grew 18% YoY. For Q3 2025, Freshworks guided revenue between $173.5M to $175.5M and raised full-year guidance to $685M–$690M, up from prior estimates of $675M–$680M.
Founding, Products, and History
Freshworks was founded in 2010 by Girish Mathrubootham and Shan Krishnasamy in Chennai, India, under the original name Freshdesk. It started as a customer support ticketing system but expanded into a broader customer experience platform. The company rebranded as Freshworks in 2017 to reflect its growing portfolio, including Freshservice (ITSM), Freshsales (CRM), Freshmarketer (marketing automation), and Freshchat (conversational engagement). Freshworks raised over $400 million from investors like Accel, Sequoia Capital India, CapitalG, and Tiger Global before going public in September 2021 on NASDAQ. Its global headquarters is in San Mateo, California, with large R&D operations in India.
Freshworks’ key competitors include Zendesk, Salesforce, HubSpot, ServiceNow, and Zoho. These companies compete across various categories: CRM, IT service management, marketing automation, and helpdesk. Freshworks differentiates itself with ease of use, affordability, and quick deployment, focusing more on mid-market and SMB clients compared to enterprise-heavy competitors like Salesforce and ServiceNow.
Market Landscape and TAM Outlook
Freshworks operates in the large and growing Customer Experience (CX) and Service Management markets. The combined TAM for CRM, ITSM, and support software is expected to exceed $300 billion by 2030, according to IDC and Gartner projections. The SaaS CRM segment alone is projected to grow at a 13% CAGR through 2030, while IT service management tools are expected to expand at an 11% CAGR. The acceleration of digital transformation, remote work, and demand for AI-driven support tools are significant market tailwinds.
The SMB and mid-market CX software segments—Freshworks’ core focus—remain underserved by incumbent enterprise solutions. These companies seek cost-effective, scalable platforms that don’t require heavy customization. This provides a long runway for Freshworks to grow, particularly as it invests in generative AI to power smarter ticketing, workflow automation, and customer engagement.
Competitive Landscape
Freshworks faces stiff competition across product categories. Zendesk is a direct rival in customer support; HubSpot and Salesforce dominate the CRM space; ServiceNow leads in ITSM. Additionally, Zoho, another India-originated company, competes across all these categories with a suite of integrated products targeting the same SMB and mid-market. However, many competitors either focus on large enterprises or require complex implementation, where Freshworks appeals with its “ready-to-use” SaaS experience.
Unique Differentiation
Freshworks’ core differentiation lies in its ease of use, fast time-to-value, and modular pricing structure tailored for SMBs and mid-market firms. Unlike Salesforce or ServiceNow, Freshworks offers intuitive UI/UX, quicker onboarding, and lower total cost of ownership. Its products are unified under a single data architecture, allowing seamless integration and usage across its CX stack. Furthermore, Freshworks has been an early adopter of generative AI, integrating features like Freddy AI to streamline support and sales workflows across its tools.
Management Team Overview
Girish Mathrubootham, the co-founder and CEO, is a former Zoho executive who has become one of the most well-known SaaS entrepreneurs from India. He is widely respected for his product vision and SMB-first philosophy.
Dennis Woodside, President, joined in 2022 and previously held executive roles at Dropbox and Google. He brings operational scale and enterprise experience to complement Freshworks’ growth journey.
Tyler Sloat, CFO since 2020, previously served as CFO at Zuora and brings deep experience in SaaS financial operations and IPO-readiness, playing a key role in Freshworks’ 2021 public offering.
Financial Performance Overview
Over the last five years, Freshworks has consistently grown revenue from $230 million in 2020 to an expected ~$690 million in 2025, representing a CAGR of approximately 24%. Subscription revenue makes up over 90% of total revenues and has seen similar growth trends. Gross margins have remained strong in the 80%+ range, typical for SaaS businesses.
While Freshworks initially operated at a loss, it has steadily narrowed its net losses, achieving non-GAAP profitability in 2024 and turning GAAP profitable in parts of 2025. Operating margin improved significantly through cost optimization, particularly in sales efficiency and cloud infrastructure costs. Free cash flow has turned positive and is expected to remain strong due to high retention and upsell motion within the customer base.
The balance sheet remains healthy, with over $1 billion in cash and equivalents and no debt as of Q2 2025. This gives Freshworks flexibility to pursue inorganic growth, R&D expansion, or share buybacks. The company maintains a Rule of 40 score (growth + FCF margin) above 45, making it one of the better-performing mid-cap SaaS companies.
Bull Case for Freshworks
- Strong execution in SMB and mid-market SaaS with high retention and low churn.
- Differentiated product suite with strong AI integration across CRM, ITSM, and support.
- Path to sustainable GAAP profitability with expanding FCF margins.
Bear Case for Freshworks
- Intensifying competition from large vendors like Salesforce, Zoho, and HubSpot.
- Limited traction in the large enterprise segment could cap upside.
- Macro pressure on SMBs may slow new customer acquisition or expansion.
The stock is in a stage 4 decline on the monthly and weekly charts. The daily chart is looking at a reversal in the $13.65 – $14 range and should get to $14.9 on the back of good earnings in the next few days.