A Freshworks Inc.(Nasdaq: FRSH), a global AI software company focused on people, announced on Tuesday (11) its financial results for the fourth quarter and the full year ended December 31, 2024.
"Freshworks again exceeded its previous estimates in the fourth quarter across all key metrics, recording a solid quarter with revenue growth of 22% year-over-year, totaling $194.6 million, an operating cash flow margin of 21%, and an adjusted free cash flow margin of 21%," said Dennis Woodside, CEO and President of Freshworks. Companies are abandoning traditional vendors and switching to Freshworks in search of modern and straightforward solutions for customer and employee experience.
Fourth Quarter 2024 Financial Results Summary
- Revenue:Total revenue was $194.6 million, up 22% from $160.1 million in Q4 2023, and up 21% adjusted for constant currency.
- GAAP (Loss) from Operations:GAAP loss from operations was $(23.8) million, compared to $(40.0) million in the fourth quarter of 2023.
- Non-GAAP Income from Operations:Non-GAAP income from operations was $40.3 million, compared to $11.5 million in the fourth quarter of 2023.
- GAAP (Loss) Per Share:Basic and diluted GAAP loss per share was $(0.07), based on 303.6 million weighted-average shares outstanding, compared to $(0.09) in the fourth quarter of 2023.
- Non-GAAP Earnings per Share:Non-GAAP diluted earnings per share were $0.14, based on 306.1 million weighted average shares outstanding, compared to $0.08 in the fourth quarter of 2023.
- Operating Cash Flow:Operating cash flow was $41.4 million, compared to $30.9 million in the fourth quarter of 2023.
- Adjusted Free Cash Flow:Adjusted free cash flow was $41.7 million, compared to $28.6 million in the fourth quarter of 2023.
- Cash and Cash Equivalents:Cash, cash equivalents and marketable securities totaled $1.07 billion at December 31, 2024.
Full Year 2024 Financial Results Summary
- Revenue:Total revenue was $720.4 million, representing 21% growth from $596.4 million in 2023.
- GAAP (Loss) from Operations:GAAP loss from operations was $(138.6) million, compared to $(170.2) million in 2023.
- Non-GAAP Income from Operations:Non-GAAP income from operations was $99.1 million, compared to $44.5 million in 2023.
- GAAP (Loss) Per Share:Basic and diluted GAAP loss per share was $(0.32), compared to $(0.47) in 2023.
- Non-GAAP Earnings per Share:Non-GAAP diluted earnings per share were $0.43, compared to $0.26 in 2023.
- Operating Cash Flow:Operating cash flow was $160.6 million, compared to $86.2 million in 2023.
- Adjusted Free Cash Flow:Adjusted free cash flow was $153.3 million, compared to $77.8 million in 2023.
Key Metrics and Recent Highlights
- The number of customers contributing more than $5,000 in ARR was 22,558, an 11% increase year-over-year.
- The revenue retention rate was 103% (105% adjusted for constant currency).
- New customers include New Balance, Rawlings Sporting Goods, Sophos, Onfido and Mesa Airlines.
- Appointment of Srinivasan Raghavan as Chief Product Officer and Venkitesh Subramanian as Senior Vice President of Product Management for Customer Experience.
- Announcement of strategic agreement with Unisys.
Financial Outlook to 2025
The company expects revenue to range from $190.0 – $193.0 million in the first quarter of 2025 and $809.0 – $821.0 million for the full year, with growth ranging from 12% to 14%.
