Freshworks Q3 CY26: Revenue rises 14% as company turns profitable

Freshworks reported Q3 CY26 revenue of $245.4 million, up 14% year-on-year from $215.1 million. The Nasdaq-listed SaaS company also moved into the black with net profit of $18.3 million, compared with a net loss of $4.7 million in Q3 CY25.

Gross profit rose 15% to $209.4 million from $182.2 million, while gross margin improved to 85.3% from 84.7%. Freshworks posted operating profit of $28.2 million versus an operating loss of $7.5 million a year earlier, lifting operating margin to 11.5% from a negative 3.5%.

On a non-GAAP basis, operating income increased 62% to $73.2 million, and non-GAAP operating margin expanded to 29.8% from 21%.

Sales and marketing expenses declined 2.5% to $98.5 million, while general and administrative expenses fell 19% to $38.2 million. Research and development expenses rose 7.8% to $44.7 million, but total operating expenses still declined 4.4% to $181.2 million.

Freshworks generated $77.7 million in cash from operating activities, up from $63.5 million in the year-ago quarter. Adjusted free cash flow rose 29% to $73.9 million, with the margin improving to 30.1% from 26.6%.

Freshworks crossed $1 billion in annual recurring revenue after the close of the third quarter, ahead of its earlier year-end estimate. Customers contributing more than $100,000 in ARR increased 25% year-on-year to 1,821, while net dollar retention stood at 104%.

For Q4 CY26, the company expects revenue of $253.5 million to $254.5 million. For calendar year 2026, it projected revenue of $965 million to $966 million, representing approximately 15% annual growth.