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Mar 31, 2023
Freshworks Q1 2023 Earnings Report
Freshworks' Q1 2023 revenue increased by 20% year-over-year, reaching $137.7 million, and the company achieved its first quarter of non-GAAP operating profit as a public entity.
Key Takeaways
Freshworks reported a strong first quarter in 2023, exceeding financial estimates with 20% year-over-year revenue growth (23% in constant currency) and achieving its first non-GAAP operating profit as a public company. The company also demonstrated improved business efficiency with positive free cash flow.
Revenue reached $137.7 million, a 20% increase year-over-year (23% adjusting for constant currency).
Non-GAAP income from operations was $3.9 million, marking the first profitable quarter as a public company.
Free cash flow improved to $9.1 million.
The number of customers contributing more than $5,000 in ARR increased by 18% year-over-year.
Freshworks
Freshworks
Forward Guidance
Freshworks provided revenue and non-GAAP operating income guidance for Q2 2023 and full year 2023.
Positive Outlook
- Q2 2023 revenue is expected to be between $140.0 million and $142.5 million, representing year-over-year growth of 15% - 17% (16% - 18% adjusting for constant currency).
- Q2 2023 non-GAAP income (loss) from operations is expected to be between $(2.0) million and $0.0 million.
- Q2 2023 non-GAAP net income per share is expected to be between $0.00 and $0.02.
- Full year 2023 revenue is expected to be between $580.0 million and $592.5 million, representing year-over-year growth of 16% - 19% (17% - 19% adjusting for constant currency).
- Full year 2023 non-GAAP income from operations is expected to be between $2.0 million and $8.0 million.
Challenges Ahead
- Q2 2023 non-GAAP income (loss) from operations is expected to be between $(2.0) million and $0.0 million.
- There is uncertainty and potential variability of expenses that may be incurred in the future.
- Estimates are based on current market conditions and expectations which are subject to change.
- Estimates are subject to various important cautionary factors referenced in the section entitled “Forward-Looking Statements”.
- Actual results may differ materially.