Freshworks Ups Annual Projections, Cuts 13% Workforce In Global Restructuring Plan
The company expects restructuring costs between USD 11 million and USD 13 million in the fourth quarter, with the plan set to conclude by year-end
Freshworks saw its stock climb more than 15 per cent in after-hours trading following the company’s announcement of increased annual revenue and profit forecasts, buoyed by strong demand for its AI-powered products.
The California-based software company reported third-quarter results that exceeded Wall Street’s expectations, stressing the rising interest in digital solutions as businesses integrate more artificial intelligence into their operations.
For the third quarter ending September 30, Freshworks posted a 22 per cent rise in revenue to USD 186.6 million. The company's adjusted profit per share reached 11 cents, beating estimates of 8 cents.
Encouraged by these results, Freshworks raised its annual revenue outlook to a range of USD 713.6 million to USD 716.6 million, up from a previous forecast of USD 707 million to USD 713 million. The company also improved its adjusted earnings per share forecast to 38-39 cents, up from 32-34 cents.
Despite its growth, Freshworks announced it would lay off 13 per cent of its workforce, or around 660 employees, as part of a global restructuring effort to streamline operations. The company expects restructuring costs between USD 11 million and USD 13 million in the fourth quarter, with the plan set to conclude by year-end.
Freshworks, which serves over 68,000 customers, including Databricks, American Express, Nucor, and Sony, offers key products like Freshservice for IT management and Freshdesk for customer service—tools that have become increasingly valuable as companies seek efficient, AI-enhanced digital solutions.
The company’s fourth-quarter revenue forecast of USD 187.8 million to USD 190.8 million aligns with analysts' expectations, positioning Freshworks to close out the year on a strong note.
