Dec 31, 2023

Freshworks Q4 2023 Earnings Report

Freshworks delivered a strong finish to the year, outperforming financial estimates and improving business efficiency.

Key Takeaways

Freshworks Inc. reported a 20% year-over-year increase in revenue for both the fourth quarter and full year 2023. The company's Q4 revenue reached $160.1 million, and it generated $28.6 million in free cash flow during the quarter and $77.8 million for the full year.

Q4 revenue grew 20% year-over-year, reaching $160.1 million.

GAAP loss from operations improved to $(40.0) million, compared to $(60.6) million in Q4 2022.

Non-GAAP income from operations was $11.5 million, compared to a non-GAAP loss of $(2.8) million in Q4 2022.

Free cash flow for the quarter was $28.6 million, compared to $4.0 million in Q4 2022.

Total Revenue
$160M
Previous year: $133M
+20.2%
EPS
$0.08
Previous year: $0.01
+700.0%
Customers Paying >$5k ARR
20.26K
Previous year: 17.72K
+14.3%
Net Dollar Retention Rate
108%
Previous year: 108%
+0.0%
Gross Profit
$133M
Previous year: $108M
+23.2%
Cash and Equivalents
$488M
Previous year: $304M
+60.5%
Free Cash Flow
$28.6M
Previous year: $4M
+615.0%
Total Assets
$1.46B
Previous year: $1.38B
+5.5%

Freshworks

Freshworks

Forward Guidance

Freshworks provides estimates for Q1 and full year 2024, based on current market conditions. Revenue growth rates are adjusted for constant currency.

Positive Outlook

  • Q1 2024 Revenue: $162.5 - $164.5 million
  • Q1 2024 Year-over-year growth: 18% - 19%
  • Q1 2024 Non-GAAP income from operations: $12.5 - $14.5 million
  • Q1 2024 Non-GAAP net income per share: $0.07 - $0.08
  • Full Year 2024 Non-GAAP net income per share: $0.29 - $0.31

Challenges Ahead

  • Estimates are subject to various important cautionary factors.
  • The company has not reconciled estimates for non-GAAP financial measures to GAAP due to the uncertainty and potential variability of expenses.
  • A reconciliation is not available without unreasonable effort.
  • The forward-looking statements are based on current expectations, estimates and projections.
  • Actual results may differ materially from those expressed in the forward-looking statements.