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SAN MATEO, California - Freshworks Inc . (NASDAQ:FRSH) saw its stock jump 8.5% after the provider of AI-powered service software reported fourth-quarter earnings and revenue that exceeded analyst expectations, while also issuing upbeat guidance for the full year 2025.
The company posted adjusted earnings per share of $0.14 for Q4, surpassing the analyst estimate of $0.10. Revenue came in at $194.6 million, beating the consensus forecast of $189.5 million and representing a 22% increase YoY.
Freshworks’ strong performance was driven by continued customer adoption of its uncomplicated, modern employee and customer experience solutions. The company reported 22,558 customers contributing more than $5,000 in annual recurring revenue, up 11% YoY.
"Freshworks outperformed its previously provided estimates again in Q4 across all our key metrics," said Dennis Woodside (OTC:WOPEY), CEO and President of Freshworks. "Companies are leaving legacy vendors and coming to Freshworks for our uncomplicated, modern employee and customer experience service solutions."
Looking ahead, Freshworks provided guidance for fiscal year 2025, projecting revenue between $809 million and $821 million. The midpoint of this range is slightly above the analyst consensus of $813.5 million.
The company’s fourth-quarter net cash provided by operating activities was $41.4 million, compared to $30.9 million in the same period last year. Adjusted free cash flow improved to $41.7 million from $28.6 million in Q4 2023.
Freshworks’ positive results and outlook, coupled with its strong cash flow generation, appear to have resonated well with investors, as reflected in the stock’s significant post-earnings rally.
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