Freshworks beats revenue estimates, turns profitable in Q2

Nasdaq-listed Software-as-a-Service (SaaS) company Freshworks reported a return to profitability in the second quarter of 2026, with a 16% increase in revenue as demand for its artificial intelligence (AI) offerings continued to strengthen.

The company posted a net profit of $3.2 million for the quarter, compared to a net loss of $1.7 million in the corresponding period last year. Revenue rose to $237.4 million in the April–June quarter from $204.7 million a year earlier.

The company said the non-GAAP income in the second quarter of 2026 from operations was $55.9 million, representing a non-GAAP operating margin of 23.6%, compared to$44.8 million, representing a non-GAAP operating margin of 21.9%, in the second quarter of 2025.

“Freshworks just delivered its seventh straight quarter beating revenue estimates, its eighth consecutive quarter hitting Rule of 40, and a milestone we said we'd hit – GAAP profitability, months ahead of plan. This isn't just a moment, this has been a pattern of execution,” said Freshworks CEO & President Dennis Woodside.

Freshworks said the number of customers contributing more than $100,000 in annual recurring revenue (ARR) was 1,746, which was 25% year-over-year (YoY) growth . The number of customers contributing more than $50,000 in ARR was 4,091, an increase of 18% YoY.

The net dollar retention rate was 104%, compared to 106% in the first quarter of 2026 and 106% in the second quarter of 2025.

For the third quarter, Freshworks expects revenue to be in the range of $244.5 million to $245.5 million, representing year-on-year growth of about 14%. For the full year 2026, the company has forecast revenue between $963.5 million and $966.5 million, implying annual growth of approximately 15%.

Woodside said the company’s Freddy AI Copilot is now attached to over 71% of new deals. “We built a platform for the mid-market and agile enterprise that we believe no one else can match, and we're demonstrating you can grow fast, stay disciplined, and be profitable all at the same time. This is what a durable, category-defining business should look like," he remarked.