Freshworks reports $18M profit in Q3 as revenue grows 14%

Freshworks reported a net profit of $18.3 million for the third quarter of 2026, marking a turnaround from the $4.7 million loss recorded during the same period last year. Total revenue reached $245.4 million, representing a 14% increase year-over-year.

The firm's improved financial position resulted largely from a 4.4% reduction in operating expenses, which fell to $181.2 million. Decreases in administrative overhead and stock-based compensation expenses contributed to the improved margins. CEO Dennis Woodside attributed the performance to the company’s strategic shift toward enterprise-level customers, with deal volume for multi-product employee experience platforms growing by more than 35%.

Despite the growth in large accounts—where customers contributing over $100,000 in annual recurring revenue increased by 25%—the company's net dollar retention rate remained flat at 104%. Following the conclusion of the quarter, Freshworks reached the milestone of $1 billion in annual recurring revenue.

Looking ahead, Freshworks raised its full-year revenue outlook to between $965 million and $966 million. The company continues to invest in AI-driven service management, supported by recent acquisitions such as FireHydrant and Robusta Dev, following a restructuring effort earlier this year that included an 11% workforce reduction.