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Sep 30, 2022
Freshworks Q3 2022 Earnings Report
Freshworks' Q3 2022 earnings showcased strong revenue growth and improved operating efficiency.
Key Takeaways
Freshworks reported a strong third quarter with revenue reaching $128.8 million, a 33% increase year-over-year (37% adjusting for constant currency). The company demonstrated improved operating efficiency with a reduced GAAP loss from operations. Key metrics included a 19% increase in customers contributing more than $5,000 in ARR and a net dollar retention rate of 107%.
Total revenue was $128.8 million, up 33% year-over-year (37% adjusting for constant currency).
GAAP loss from operations improved to $(58.3) million, compared to $(140.3) million in Q3 2021.
Customers contributing more than $5,000 in ARR increased by 19% year-over-year.
Net dollar retention rate was 107%.
Forward Guidance
Freshworks provided estimates for the fourth quarter and full year 2022 based on current market conditions and expectations, with revenue growth rates adjusted for constant currency.
Positive Outlook
- Fourth Quarter 2022 Revenue: $129.2 - $131.2 million (27%-28% growth adjusting for constant currency)
- Full Year 2022 Revenue: $494.0 - $496.0 million (36%-37% growth adjusting for constant currency)
- Fourth Quarter 2022 Non-GAAP loss from operations: ($10.5) - ($8.5) million
- Full Year 2022 Non-GAAP loss from operations: ($30.0) - ($28.0) million
- Fourth Quarter 2022 Non-GAAP net loss per share: ($0.05) - ($0.03)
Challenges Ahead
- Full Year 2022 Non-GAAP net loss per share: ($0.13) - ($0.11)
- Estimates are subject to cautionary factors referenced in the “Forward-Looking Statements” section.
- Revenue and non-GAAP loss from operations are based on exchange rates as of October 28, 2022.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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