Freshworks Inc. (FRSH)

Price$12.90Cached quoteAs of 2026-09-04 16:23 UTC

AI: Fair-priced

Price checkThe shares look fairly priced because improving cash generation is balanced by still-heavy stock-based pay.

At the latest close, the market value of all shares is about $3.5 billion. Against roughly $904 million of trailing revenue, that is about 3.9 times sales; subtracting the supplied $460 million net cash gives about 3.3 times trailing sales. Using management’s raised 2026 revenue midpoint, the value after subtracting net cash is near 3.1 times sales. Free cash flow, meaning cash left after operations and capital spending, is about $234 million, a roughly 6.7% yield. Inference: that looks reasonable, not obviously cheap, because stock compensation, pay issued in shares, remains large.

Big pictureRevenue and cash flow are rising steadily, but accounting profit is only newly durable.

Revenue rose from $720 million in 2024 to $839 million in 2025, while operating cash flow increased from $161 million to $242 million. Through the latest four quarters, revenue reached about $904 million and free cash flow about $234 million. Yet trailing operating profit under standard accounting is only about $30 million, roughly a 3% margin, showing the cash result still runs far ahead of reported operating earnings. The SEC-derived history also shows more than $460 million of net cash at June 2026. Pasted text

Business strengthStrong gross profit, larger customers, and fewer shares can make future earnings grow faster.

Gross profit was about 85% of second-quarter revenue, meaning most sales remained after direct service costs. Revenue grew 16% year over year, customers contributing more than $100,000 of annual recurring revenue grew 25%, and the employee-experience business grew recurring revenue about 24%. Stock compensation was about $181 million over the latest four quarters, close to 20% of revenue. Buybacks were larger, and diluted weighted shares fell about 7% year over year. That offset dilution, though the repurchases also consumed cash.

What could change the storySustained mid-teens growth with better true margins would create upside; weaker retention would undermine it.

The strongest bull case is that enterprise wins and artificial-intelligence adoption keep revenue growth around the mid-teens while the high gross profit rate converts into much higher accounting profit. The bear case is weaker expansion inside existing customers: net dollar retention, which measures recurring revenue kept and expanded from the same customer group, slipped to 104% from 106% in the prior quarter. Because larger customers are growing fastest, enterprise software budget cycles matter more than before. Single-digit growth, weaker retention, or renewed dilution would weaken the fair-price case quickly.

AI: News

Quarterly beat and raiseFreshworks beat second-quarter expectations, reached quarterly accounting profit, and raised its full-year revenue and profit outlook.

On August 4, revenue reached $237.4 million, up 16% year over year, while operating margin under standard accounting improved to 2.6% from negative 4.2%. Management raised 2026 revenue guidance to $963.5-$966.5 million and company-adjusted earnings guidance to $0.66-$0.68 per share. Larger customers remained the clearest growth engine, with customers above $100,000 in annual recurring revenue up 25%. The event strengthened expectations for durable growth and margin improvement, both central to the current valuation.

Product leadership changeFreshworks combined product and engineering leadership under Ryan Manning as artificial-intelligence competition intensifies.

On July 28, Freshworks named Ryan Manning chief product and technology officer, effective August 10, succeeding Srini Raghavan and bringing product and engineering under one leader. Shares finished that session about 3.3% higher; a contemporaneous market report linked the move to the appointment, but that timing does not prove causation. The business implication is clearer: faster product coordination could help Freshworks convert growing enterprise and artificial-intelligence demand into revenue, while a disruptive transition could slow execution.

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Revenue

2019

2020

2021

2022

2023

2024

2025

Net income

2019

2020

2021

2022

2023

2024

2025

Free cash flow

2019

2020

2021

2022

2023

2024

2025

Total cash / debt

CashTotal debt

2019

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2025

Financial statements

	2025	2024	2023	2022	2021	2020	2019
Revenue	$838.8M	$720.4M	$596.4M	$498.0M	$371.0M	$249.7M	$172.4M
Gross profit	$712.7M	$607.1M	$493.1M	$402.2M	$293.0M	$197.2M	$135.9M
Gross margin	84.96%	84.27%	82.67%	80.77%	78.97%	78.97%	78.85%
Research & development	$163.2M	$164.6M	$137.8M	$135.5M	$120.4M	$69.2M	$38.6M
Operating expenses	$699.5M	$745.7M	$663.2M	$635.6M	$497.8M	$253.3M	$165.6M
Operating income	$13.2M	−$138.6M	−$170.2M	−$233.4M	−$204.8M	−$56.1M	−$29.7M
Operating margin	1.57%	−19.24%	−28.53%	−46.86%	−55.19%	−22.48%	−17.21%
EBITDA	$39.1M	−$119.2M	−$158.0M	−$221.9M	−$191.5M	−$44.9M	−$23.4M
EBITDA margin	4.66%	−16.55%	−26.50%	−44.55%	−51.61%	−18.00%	−13.58%
Net income	$183.7M	−$95.4M	−$137.4M	−$232.1M	−$192.0M	−$57.3M	−$31.1M
Net profit margin	21.90%	−13.24%	−23.04%	−46.61%	−51.75%	−22.95%	−18.06%
Basic EPSper basic share	$0.63	-$0.32	-$0.47	-$0.82	-$21.73	-$21.03	-$8.21
Diluted EPSper diluted share	$0.63	-$0.32	-$0.47	-$0.82	-$21.73	-$21.03	-$8.21

Review official source filings ↗

Owners

Reported shareholders

Reference date Jun 30, 2026

8.19%of listed shares

BlackRock, Inc.19.56M shares · Jun 30, 2026

View holders

Top 20 reported holders of FRSH
Holder	% owned
BlackRock, Inc.	8.19%19.56M shares
Alphabet Inc.	6.79%16.21M shares
CapitalG IV LP / CapitalG IV GP LLC	≈6.79%16.21M shares
VANGUARD PORTFOLIO MANAGEMENT LLC	6.66%15.91M shares
AQR CAPITAL MANAGEMENT LLC	4.60%10.98M shares
VANGUARD CAPITAL MANAGEMENT LLC	4.38%10.45M shares
Haveli Investment Management LLC	3.43%8.2M shares
WestBridge Capital Management, LLC	3.29%7.86M shares
CITADEL ADVISORS LLC	2.86%6.84M shares
STATE STREET CORP	2.37%5.66M shares
GEODE CAPITAL MANAGEMENT, LLC	2.36%5.64M shares
ARROWSTREET CAPITAL, LIMITED PARTNERSHIP	2.16%5.15M shares
MORGAN STANLEY	2.05%4.89M shares
GANDHI SAMEER K	≈1.87%4.47M shares
JUPITER ASSET MANAGEMENT LTD	1.84%4.39M shares
HRT FINANCIAL LP	1.75%4.18M shares
WELLINGTON MANAGEMENT GROUP LLP	1.67%4M shares
GOLDMAN SACHS GROUP INC	1.53%3.66M shares
RENAISSANCE TECHNOLOGIES LLC	1.35%3.24M shares
DIMENSIONAL FUND ADVISORS LP	1.33%3.19M shares

Percentages use 238.85M shares of this listed class outstanding on Jun 30, 2026. ≈ compares the latest reported holding with a share total from a different date; it is not a confirmed current stake.

Gray completes the 100% scale. Reported positions may overlap; holders have different reporting dates.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys3$4.98M disclosed value

Sells (SEC code S)91$47.49M disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Jun 17, 2026Form 4	Lawrence PhilippaChief Accounting Officer	SellClass A Common Stock	10.5K	$9.18	$96.7K	465.8K
Mar 4, 2026Form 4 · 10b5-1	Yamamoto MikaChief Integr Cust Growth Offcr	SellClass A Common Stock	32.6K	$8.45	$275.3K	1.13M
Mar 2, 2026Form 4	Woodside DennisCEO & President	BuyClass A Common Stock	125.0K	$7.95	$993.8K	3.00M
Jan 6, 2026Form 4 · 10b5-1	Lawrence PhilippaChief Accounting Officer	SellClass A Common Stock	765	$11.61	$8.9K	510.5K
Dec 5, 2025Form 4 · 10b5-1	Yamamoto MikaCHIEF CUST & MARKETING OFFICER	SellClass A Common Stock	15.0K	$13.00	$195.2K	490.4K