NASDAQ$FRSH

Freshworks Inc · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Freshworks' Q2 2023 financial results were announced, demonstrating revenue growth and improved efficiency.

Freshworks reported a 19% year-over-year revenue increase in Q2 2023, reaching $145.1 million. The company also improved business efficiency, generating $18.1 million in free cash flow. The full-year 2023 financial outlook was raised for non-GAAP operating profit to $28 million at the midpoint.

  • Total revenue was $145.1 million, a 19% increase compared to Q2 2022.
  • GAAP loss from operations was $(43.3) million, an improvement from $(67.4) million in Q2 2022.
  • Non-GAAP income from operations was $11.7 million, compared to a non-GAAP loss of $(15.8) million in Q2 2022.
  • Free cash flow was $18.1 million, compared to $(10.2) million in Q2 2022.

Headline financials

Total Revenue

$145M

Previous: $121M+19.5%
EPS (adj)

$0.07

Previous: -$0.06+216.7%
Customers with >$5k ARR

19.1K

Previous: 16.2K+17.8%
Net Dollar Retention Rate

108.0%

Previous: 111.0%-2.7%
Capital Expenditures

-$712K

Previous: -$3.38M+78.9%
Free Cash Flow

-$36.4M

Previous: -$73.1M+50.3%
Net Income

-$35.7M

Previous: -$69.8M+48.9%
Operating Income

-$43.3M

Previous: -$67.4M+35.7%
Gross Profit

$120M

Previous: $97.4M+23.4%
Cash & Equivalents

$356M

Previous: $590M-39.6%
Total Assets

$1.4B

Previous: $1.38B+1.6%
Stock-Based Comp

$54.2M

Previous: $50.1M+8.2%

Revenue & EPS history

Freshworks · Revenue · Quarterly

$145M

Q2 2023+19.5%vs Q2 2022
Beat estimate in 13 of 15 quarters(87%)
ActualEstimate

Forward guidance

Freshworks provided estimates for the third quarter and full year 2023 based on current market conditions and expectations.

Tailwinds

  • Third quarter revenue is expected to be between $149.0 million and $151.5 million.
  • Full year revenue is expected to be between $587.0 million and $595.0 million.
  • Third quarter year-over-year growth is expected to be between 16% and 18%.
  • Full year year-over-year growth is expected to be between 18% and 19%.
  • Full year non-GAAP net income per share is expected to be $0.18 - $0.22

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

-1.6%

Avg return

Earnings day

-2.6%

Avg return

5 days after

-4.6%

Avg return

30 days after

35%

8 / 23 earnings

Positive

+35.2%

Q3 2024

Best reaction

-21.6%

Q4 2021

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.5%-6.4%+2.9%
Q4 2025-16.4%-17.1%-6.9%
Q3 2025-2.1%+5.2%+16.1%
Q1 2025+3.0%+1.1%+6.5%
Q4 2024-0.3%-4.5%-16.7%
Q3 2024+35.2%+32.7%+33.5%
Q2 2024-6.1%-12.3%-11.9%
Q1 2024-17.8%-20.8%-27.8%
Q4 2023-2.4%+0.2%-14.4%
Q3 2023-0.4%+7.8%+13.6%
Q2 2023+15.8%+12.1%+17.2%
Q1 2023-2.9%-1.1%+16.6%
Q4 2022+4.1%-2.8%-10.1%
Q3 2022-9.9%-9.3%+11.8%
Q2 2021+3.2%+6.8%-13.6%
Q2 2022+12.2%+13.7%-0.7%
Q1 2021-12.0%-15.6%-3.9%
Q1 2022-7.1%-12.9%-10.3%
Q4 2019-5.2%-1.5%+8.1%
Q4 2021-21.6%-5.7%-26.7%
Q3 2020+2.9%-4.1%-28.1%
Q4 2020+2.9%-4.1%-28.1%
Q3 2021-10.7%-20.6%-33.0%
Q2 2020
Q1 2020
Q1 2019
Q4 2018
Q3 2018
Q2 2018
Q1 2018
Q4 2017
Q3 2017
Q2 2017
Q1 2017
Q4 2016
Q3 2016
Q2 2016
Q1 2016
Q4 2015
Q3 2015
Q2 2015
Q1 2015
Q4 2014
Q3 2014
Q2 2014

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