Freshworks Inc.

Q2 revenue was $237.4 million, up 16% year over year as reported and 15% constant currency. Non-GAAP gross margin was 86%; non-GAAP operating income was $55.9 million; GAAP net income was $3.2 million; GAAP EPS was $0.01; and non-GAAP EPS was $0.17. EX ARR ended at $567 million, up 23% year over year as reported and 24% constant currency; CX ARR ended at $400 million, up 3% as reported and 4% constant currency. Net dollar retention was 104% as reported and 105% constant currency. Calculated billings were $245.8 million, up 15% year over year as reported and 16% constant currency. Adjusted free cash flow was $57.7 million with a margin of about 24%. For Q3 2026, management expects revenue of $244.5 million to $245.5 million, up about 14% year over year, and non-GAAP operating income of $59 million to $61 million. For full-year 2026, management expects revenue of $963.5 million to $966.5 million, up about 15% year over year, non-GAAP operating income of $222 million to $228 million, non-GAAP EPS of $0.66 to $0.68, and adjusted free cash flow of about $265 million with a 27.5% margin.

Dennis Woodside framed the quarter as validation of Freshworks’ strategy across five priorities: EX-first growth, category leadership in agile enterprises, AI as a tailwind, profitability, and capital discipline. He emphasized that the company is winning larger, more complex deals while keeping the product easy to use, citing the cloud rollout of Device42 and planned integration approach for FireHydrant as examples of preserving simplicity as the platform broadens. His tone was confident and upbeat, particularly around Gartner recognition, EX momentum, and the view that AI is increasingly driving customers to re-evaluate incumbents.

Tyler Sloat focused on execution against the financial plan: Q2 revenue beat estimates, non-GAAP gross margin held at 86%, operating income reached $55.9 million, and the company posted positive GAAP net income ahead of schedule. He highlighted $57.7 million of adjusted free cash flow, a 24% margin, and reiterated the full-year target of about $265 million in adjusted free cash flow and $0.94 per share. He also detailed capital allocation, including over $200 million spent year-to-date on buybacks, 18.3 million shares repurchased for $159 million in Q2, and an ending cash and investments balance of $665 million with no debt.

Analysts pressed management on whether adding more modules and AI could make the platform harder to use; Dennis said product and design teams are focused on maintaining usability, with Device42 now appearing as a native tab in Freshservice and similar integration planned for FireHydrant. Questions also focused on AI-native startups, and Dennis said Freshworks has not seen them materially in deals yet because customers want a secure system of record with embedded AI, not just an overlay. On EX growth, Tyler attributed the mid-20s outlook to larger deals, a stronger pipeline, and cross-sell opportunities in ITAM, ESM, and FireHydrant, while acknowledging quarter-to-quarter noise. Analysts also asked about partner influence, and Dennis said partner involvement improves retention, expansion, and close rates, with about 40% of business already partner-influenced.