Freshworks Reports 19% Growth in Q1 2025

Freshworks demonstrated a remarkable 19% year-on-year increase in the first quarter of 2025. Additionally, the company successfully reduced its operational losses by 67.7% during this timeframe.

The operating revenue for Freshworks rose to $196.2 million in the quarter ending March 2025, compared to $165.1 million in Q1 of the previous calendar year, as indicated by its regulatory filing with NASDAQ.

Strong Financial Performance

Dennis Woodside, the Chief Executive Officer and President of Freshworks, noted that the company delivered a strong performance in the first quarter, exceeding prior financial forecasts with a revenue increase of 19% year-on-year to $196.3 million. The firm also secured an operating cash flow margin of 30% and an adjusted free cash flow margin of 28%.

Annual Growth Trajectory

For the entire previous financial year, Freshworks achieved a year-on-year growth rate of 20.8%, elevating its revenue from $596 million in 2023 to an impressive $720 million in 2024.

Product Portfolio

Freshworks offers an extensive suite of products including Freshservice, Freshdesk, Freshmarketer, Freshchat, and Freshsales to support marketing, sales, customer support, and IT solutions for organisations worldwide.

Cost Management

On the financial outlay side, sales and marketing expenses accounted for 43% of total expenditures, which decreased by 5.8% to $89.1 million in Q1 of 2025. Overall costs, including research, employee salaries, and general overheads, amounted to $207.6 million in the same quarter.

Operational Loss Reduction

This positive growth and efficient cost control enabled Freshworks to diminish its operational losses by 67.7%, reducing losses to $10.4 million in Q1 of 2025 from $32.1 million during the same quarter last year.

Future Revenue Projections

Looking forward, Freshworks anticipates generating revenues between $197.3 million and $200.3 million in the second quarter of 2025, with total annual revenue expected to reach $824 million for the year.

Operational Streamlining

In the last quarter of the previous financial year (Q4 2024), Freshworks reduced its workforce by 13% as part of an effort to streamline operations. Furthermore, the firm announced a $400 million stock buyback programme.