Chennai, Aug 06: Freshworks Inc., today announced financial results for its second quarter ended June 30, 2026.
“Freshworks just delivered its seventh straight quarter beating revenue estimates, its eighth consecutive quarter hitting Rule of 40, and a milestone we said we’d hit – GAAP profitability, months ahead of plan. This isn’t just a moment, this has been a pattern of execution,” stated Dennis Woodside, CEO & President of Freshworks. “EX ARR grew24% year-over-year, and Freddy AI Copilot is now attached to over 71% of new enterprise deals. Customers aren’t testing AI with us, they’re adopting and using Freddy AI. We built a platform for the mid-market and agile enterprise that we believe no one else can match, and we’re demonstrating you can grow fast, stay disciplined, and be profitable all at the same time. This is what a durable, category-defining business should look like”
Second Quarter 2026 Financial Summary Results
- Revenue: Total revenue was $237.4 million, representing growth of 16%compared to total revenue of $204.7 million in the second quarter of 2025, and15% adjusting for constant currency.
- GAAP Income (Loss) from Operations: GAAP income (loss) from operations was $6.1 million, representing an operating margin of 2.6%, compared to $(8.7) million, representing an operating margin of (4.2)%, in the second quarter of 2025.
- Non-GAAP Income from Operations: Non-GAAP income from operations was$55.9 million, representing a non-GAAP operating margin of 23.6%, compared to$44.8 million, representing a non-GAAP operating margin of 21.9%, in the second quarter of 2025.
- GAAP Net Income (Loss) Per Share: GAAP diluted net income (loss) per share was $0.01 based on 273.0 million weighted-average shares outstanding, compared to $(0.01) based on 294.4 million weighted-average shares outstanding in the second quarter of 2025.
- Non-GAAP Net Income Per Share: Non-GAAP diluted net income per share was$0.17 based on 273.0 million weighted-average shares outstanding, compared to$0.18 based on 297.3 million weighted-average shares outstanding in the second quarter of 2025.
- Net Cash Provided by Operating Activities: Net cash provided by operating activities was $58.5 million, representing an operating cash flow margin of 24.7%,compared to $58.6 million, representing an operating cash flow margin of 28.6%, in the second quarter of 2025.
- Adjusted Free Cash Flow: Adjusted free cash flow was $57.7 million, representing an adjusted free cash flow margin of 24.3%, compared to $54.3million, representing an adjusted free cash flow margin of 26.5%, in the second quarter of 2025.
- Cash, Cash Equivalents, Restricted Cash and Marketable Securities: Cash, cash equivalents, restricted cash and marketable securities were $665.3 million as of June 30, 2026.
All financial numbers for 2026 include the results of our FireHydrant business. A description of non-GAAP financial measures is contained in the section titled “Explanation of Non-GAAP Financial Measures” below and a reconciliation of GAAP ton on-GAAP financial measures is detailed in the tables below.
Second Quarter Metrics and Recent Business Highlights
- Number of customers contributing more than $100,000 in ARR was 1,746 of 25% year-over-year and 26% adjusting for constant currency.
- Number of customers contributing more than $50,000 in ARR was 4,091, an increase of 18% year-over-year and 19% adjusting for constant currency.
- Number of customers contributing more than $5,000 in ARR was 25,356, an increase of 6% year-over-year and 6% adjusting for constant currency.
- Net dollar retention rate was 104%, compared to 106% in the first quarter of 2026and 106% in the second quarter of 2025. Adjusted for constant currency, net dollar retention rate was 105%, compared to 105% in the first quarter of 2026 and104% in the second quarter of 2025.
- Announced AI Agent Studio and MCP Gateway for Freshservice.
- Welcomed and onboarded many new customers to the Freshworks community including Van Marcke, Hydrite Chemical, Simpar, Upland Software, Paddle, and Open Health Communications.
- Appoints Ryan Manning as Chief Product and Technology Officer.
- Named a Leader in the 2026 Gartner® Magic Quadrant™ for IT Service Management Platforms.
Financial Outlook
We are providing estimates for the third quarter and for the full year 2026. We emphasize that these estimates are subject to various important cautionary factors referenced in the section entitled “Forward-Looking Statements” below.
For the third quarter and full year 2026, we currently expect the following results:
|
($ in millions, except per share data) |
Third Quarter 2026 |
Full Year 2026 |
|||
|
Revenue(1) |
$244.5 – $245.5 |
$963.5 – $966.5 |
|||
|
Year-over-year growth |
~14% |
~15% |
|||
|
Year-over-year growth(constant currency) |
14% – 15% |
14% – 15% |
|||
|
Non-GAAP income from operations(1) |
$59.0 – $61.0 |
$222.0 – $228.0 |
|||
|
Non-GAAP net income per share(2) |
$0.18 |
$0.66 – $0.68 |
(1) Revenue and non-GAAP income from operations are based on exchange rates asof August 1, 2026 for currencies other than USD.
(2) Non-GAAP net income. per share was estimated assuming 265.8 million and 272.8million weighted-average shares outstanding for the third quarter and full year 2026, respectively.
These statements are forward-looking and actual results may differ materially. Refer to the “Forward-Looking Statements” safe harbor section below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.
We have not reconciled our third quarter and full year 2026 estimates for non-GAA financial measures to GAAP due to the uncertainty and potential variability of expenses that may be incurred in the future. Accordingly, a reconciliation is not available without unreasonable effort, and we are unable to address the probable significance of the unavailable information. We have provided a reconciliation of other GAAP to non-GAAP financial measures in the financial statement tables for our second quarter 2026 and 2025 non-GAAP results included in this press release.
