Freshworks Reports 18% Revenue Growth to $204.7 Million in Q2 2025

Freshworks Inc. reported its financial results for the second quarter of 2025, revealing a revenue of $204.7 million, an 18% increase from $174.1 million in the same period last year. For the first half of 2025, the company generated $401.0 million in revenue, up from $339.3 million in the first half of 2024. Despite the revenue growth, Freshworks recorded a net loss of $1.7 million for the quarter, a significant improvement compared to a net loss of $20.2 million in Q2 2024. The company’s operating loss also narrowed to $8.7 million from $43.8 million year-over-year.

The company’s financial performance was bolstered by a strong subscription service segment, which accounted for the majority of its revenue. Subscription services, software licenses, and maintenance revenue rose to $202.0 million in Q2 2025, compared to $171.6 million in Q2 2024. The increase in revenue was attributed to both new customer acquisitions and expansion within existing accounts, with the net dollar retention rate remaining stable at 106%. Freshworks also reported a total of 23,975 customers contributing more than $5,000 in annual recurring revenue (ARR), reflecting a 10% increase from the previous year.

In terms of operational developments, Freshworks completed the acquisition of D42 Parent, Inc. in June 2024, which has allowed the company to enhance its IT solutions offerings. The integration of D42 has contributed to increased amortization expenses related to acquired technologies. The company has also focused on improving its operational efficiency, resulting in a 4% decrease in total operating expenses for the quarter, driven by lower headcount following a restructuring initiative. As of June 30, 2025, Freshworks had a total employee headcount of 2,369, down from 2,569 at the end of 2024.

Geographically, Freshworks saw significant revenue growth in North America, which accounted for $95.1 million in Q2 2025, up from $78.9 million in the same quarter last year. The company also reported growth in the Europe, Middle East, and Africa (EMEA) region, with revenue increasing to $79.3 million from $67.3 million. The Asia Pacific region contributed $24.7 million, up from $22.8 million in the prior year. The company’s cash and cash equivalents stood at $486.0 million, alongside marketable securities of $440.2 million, providing a solid liquidity position to support future growth initiatives.

Looking ahead, Freshworks anticipates continued revenue growth driven by its expanding customer base and product offerings, particularly in the AI-driven solutions segment. However, the company remains cautious about macroeconomic uncertainties, including inflation and foreign exchange volatility, which could impact customer spending and overall business performance. Freshworks plans to leverage its strong cash position to invest in product development and customer acquisition strategies while navigating the evolving market landscape.