Q1 2025 Freshworks Inc Earnings Call Transcript
Key Points
- Freshworks Inc (FRSH) reported a 19% year-over-year revenue growth to $196.3 million in Q1 2025.
- The company achieved a non-GAAP operating margin of 24% and an adjusted free cash flow margin of 28%, surpassing financial estimates.
- Freshworks Inc (FRSH) added over 1,000 net customers in the quarter, including large enterprises like Freudenberg Group and All3Media.
- The company maintained a net dollar retention rate of 105% on a constant currency basis, consistent with the previous two quarters.
- Freshworks Inc (FRSH) saw significant growth in its Employee Experience (EX) business, surpassing $420 million in ARR with a 33% year-over-year growth.
- Despite strong performance, Freshworks Inc (FRSH) faces uncertainties in the macroeconomic environment and market volatility.
- The company anticipates increased expenses in Q2 due to annual merit cycles and investments in sales and marketing, which may impact operating margins.
- Freshworks Inc (FRSH) is experiencing competitive pressure from legacy software vendors, which could affect market share.
- The company is navigating through a period of market volatility and economic uncertainty, which could impact future performance.
- Freshworks Inc (FRSH) is dealing with internal changes, such as the departure of a key sales executive, which could pose challenges in maintaining sales momentum.
Welcome to Freshworks First Quarter 2025 Earnings Conference Call.
(Operator Instructions)
Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Joon Huh, Head of Investor Relations. Please go ahead.
Thank you. Good afternoon, and welcome to Freshworks First Quarter 2025 Earnings Conference Call. Joining me today are Dennis Woodside, Freshworks' Chief Executive Officer and President; and Tyler Sloat, FreshWorks' Chief Operating Officer and Chief Financial Officer. The primary purpose of today's call is to provide you with information regarding our first quarter 2025 performance and our financial outlook for our second quarter and full year 2025. Some of our discussion and responses to your questions may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are based on our management's beliefs about our business and
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