Freshworks Q4 2024 Earnings Report

Key Takeaways

Freshworks delivered a strong Q4 2024 with revenue growing 22% year-over-year to $194.6 million. The company reduced its GAAP operating loss and significantly increased its non-GAAP income from operations. Non-GAAP diluted EPS was $0.14, up from $0.08 a year ago. Adjusted free cash flow improved to $41.7 million.

Total Revenue

$195M

Previous year: $160M

+21.5%

EPS

$0.14

Previous year: $0.08

+75.0%

Customers >$5K ARR

22.56K

Previous year: 20.31K

+11.1%

Net Dollar Retention

103%

Previous year: 108%

-4.6%

Gross Profit

$165M

Previous year: $133M

+24.0%

Cash and Equivalents

$620M

Previous year: $1.19B

-47.8%

Free Cash Flow

$41.7M

Previous year: $47.8M

-12.7%

Total Assets

$1.61B

Previous year: $1.46B

+10.6%

Freshworks Revenue

Freshworks EPS

Forward Guidance

Freshworks expects revenue between $190.0 million and $193.0 million in Q1 2025, reflecting a 15-17% YoY growth. Non-GAAP income from operations is expected to range between $32.5 million and $34.5 million, while non-GAAP EPS is projected between $0.12 and $0.14.

Positive Outlook

Strong revenue growth projected between 15% and 17%
Continued expansion in customer base
Positive free cash flow outlook
Non-GAAP operating income expected to improve
Operational efficiency initiatives yielding results

Challenges Ahead

Decline in net dollar retention rate
GAAP operating loss remains a concern
Ongoing restructuring costs impacting profitability
Foreign exchange fluctuations affecting revenue visibility
Competitive pressures from established SaaS providers