Freshworks posted an 18% jump in Q2 revenue, touching $204.7 million, as demand for its AI-led tools grew. Cost control measures helped narrow its net loss to just $1.7 million from $20.1 million a year ago. The firm also raised its full-year outlook on the back of enterprise momentum.
Nasdaq-listed homegrown SaaS major Freshworks has reported an 18% year-on-year increase in revenue to $204.7 million for the quarter ended on June 30, 2025. The number was $174.1 million a year earlier.
Besides this, the company has also trimmed its net loss to $1.7 million, from $20.1 million in the same period last year. It has also raised its revenue guidance for the third quarter of FY25.
The company now expects its revenue forecast to fall between $207 million and $210 million, indicating a year-on-year growth of 11% to 12%. For the full fiscal year, it anticipates revenue to land in the range of $822.9 million to $828.9 million.
The improvement in financials followed the company's reduction in operating expenses and the increased adoption of its AI-powered solutions in the market.
“We believe our strong momentum through the first half of the year reflects that businesses are increasingly turning to Freshworks to reduce complexity. They want AI-powered employee and customer service solutions that are fast to implement, easy to use, and built to deliver results,” said Dennis Woodside, chief executive and president of Freshworks.
He further listed three key drivers of the company’s growth strategy. These include, delivering artificial intelligence capabilities across the product suit to accelerate adoption, investing in employee experience, and expanding customer experience offerings.
To focus on these products, the company had earlier decided to combine CX products, including “support, sales and marketing, and reallocating people and investments".
The company also revealed that nearly 60% of its total annual recurring revenue (ARR) now comes from mid-market and enterprise customers. For Freshworks, mid-markets means organisations with 251 to 5,000 employees, and enterprises are those with over 5,000 employees.
Freshworks, founded in 2010 by Girish Mathrubootham and Shanmugam Krishnasamy, began its journey in San Mateo, California, as a CRM platform designed to serve small and mid-sized businesses.
Over the years, the company has expanded its scope, now placing greater emphasis on mid-market and enterprise clients. It delivers a broad range of tools for both employee and customer engagement—spanning IT and enterprise service management, as well as support, sales, and marketing platforms.
