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FRSH, Freshworks Inc.

Software asset-light

Freshworks provides solutions that enable organizations to acquire, engage, and better serve their customers and employees.

We provide people-first AI service software that organizations use to deliver exceptional employee and customer experiences.

Our AI offerings, which include Freddy AI Agents, Freddy AI Copilot and Freddy AI Insights, further enhance the employee and customer experience and are designed to boost productivity.

Latest annual: FY2025 10-K

FRSH · Freshworks Inc.

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$839M

+16.4% YoY · 27% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $871M 5-yr avg $605M

Gross margin 85% 5-yr avg 82%

Operating margin 1.8% 5-yr avg −29.7%

ROIC 3% 5-yr avg −20%

Owner-earnings margin 27% 5-yr avg 13%

Free cash flow margin 27% 5-yr avg 13%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What moves the needle: Operating margin has run around −22% through the cycle on a 81% gross margin, the operating line in the red even at its best — so the lever is whether the spending below the gross line can come down enough to clear a profit: revenue growth against the cost curve, and the cash runway until it does. Stock-based pay runs about 30% of sales, a real and recurring claim on owners that the GAAP margin understates. Read this kind of business on retention and the cost of growth. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median −23%, above 15% in 0 of 5 years). The steadier read is owner earnings: roughly 11% of revenue reaches owners as cash, though it swings. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2019–2025

realized figures from each filing · older years to the left

2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
								Income statement
$172M	$250M	$371M	$498M	$596M	$720M	$839M	$871M	RevenueRevenue
79%	79%	79%	81%	83%	84%	85%	85%	Gross marginGross mgn
9%	20%	32%	31%	28%	25%	17%	15%	SG&A / revenueSG&A/rev
22%	28%	32%	27%	23%	23%	19%	20%	R&D / revenueR&D/rev
($30M)	($56M)	($205M)	($233M)	($170M)	($139M)	$13M	$16M	Operating incomeOp. inc.
−17.2%	−22.5%	−55.2%	−46.9%	−28.5%	−19.2%	1.6%	1.8%	Operating marginOp. mgn
($31M)	($57M)	($192M)	($232M)	($137M)	($95M)	$184M	$180M	Net incomeNet inc.
								Cash flow & returns
($8M)	$33M	$11M	($3M)	$86M	$161M	$242M	$247M	Operating cash flowOp. cash
$6M	$11M	$13M	$12M	$12M	$19M	$26M	$27M	DepreciationDeprec.
$16M	$35M	$17M	$10M	$763K	$20M	($114M)	($100M)	Working capital & otherWC & other
$12M	$4M	$6M	$7M	$2M	$9M	$6M	$8M	CapexCapex
6.7%	1.8%	1.5%	1.4%	0.3%	1.3%	0.7%	1.0%	Capex / revenueCapex/rev
($14M)	$28M	$6M	($10M)	$84M	$151M	$237M	$238M	Owner earningsOwner earn.
−8.4%	11.3%	1.6%	−1.9%	14.1%	21.0%	28.2%	27.4%	Owner earnings marginOE mgn
($20M)	$28M	$6M	($10M)	$84M	$151M	$237M	$238M	Free cash flowFCF
−11.4%	11.3%	1.6%	−1.9%	14.1%	21.0%	28.2%	27.4%	Free cash flow marginFCF mgn
$6M	$5M	$0	$0	$0	$214M	$0	$57M	AcquisitionsAcquis.
—	—	—	$0	$0	$14M	$386M	—	BuybacksBuybacks
—	—	-33%	-25%	-23%	-21%	3%	3%	ROICROIC
—	—	-16%	-22%	-13%	-8%	18%	18%	Return on equityROE
—	—	−16%	−22%	−13%	−8%	18%	18%	Retained to equityRetained/eq
								Balance sheet
$75M	$238M	$1.3B	$1.1B	$1.2B	$1.1B	$781M	$779M	Cash & investmentsCash+inv
—	$34M	$52M	$70M	$97M	$123M	$151M	$127M	ReceivablesReceiv.
—	$4M	$6M	$6M	$3M	$2M	$12M	$19M	Accounts payablePayables
—	$31M	$45M	$65M	$94M	$121M	$139M	$109M	Operating working capitalOper. WC
—	$312M	$1.4B	$1.3B	$1.4B	$1.3B	$1.1B	$1.0B	Current assetsCur. assets
—	$152M	$223M	$272M	$327M	$408M	$498M	$520M	Current liabilitiesCur. liab.
—	2.1×	6.4×	4.7×	4.1×	3.1×	2.2×	1.9×	Current ratioCurr. ratio
—	$6M	$6M	$6M	$6M	$147M	$147M	$199M	GoodwillGoodwill
—	$367M	$1.5B	$1.4B	$1.5B	$1.6B	$1.6B	$1.6B	Total assetsAssets
($75M)	($238M)	($1.3B)	($1.1B)	($1.2B)	($1.1B)	($781M)	($779M)	Net debt / (cash)Net debt
($1.1B)	($2.7B)	$1.2B	$1.1B	$1.1B	$1.1B	$1.0B	$1.0B	Shareholders’ equityEquity
0.2%	17.3%	46.7%	41.7%	35.3%	30.1%	17.5%	16.0%	Stock comp / revenueSBC/rev
								Per share
76.0M	76.9M	131M	285M	293M	301M	294M	283M	Shares out (diluted)Shares
$2.27	$3.24	$2.84	$1.75	$2.03	$2.39	$2.86	$3.07	Revenue / shareRev/sh
$-0.41	$-0.74	$-1.47	$-0.82	$-0.47	$-0.32	$0.63	$0.64	EPS (diluted)EPS
$-0.19	$0.37	$0.05	$-0.03	$0.29	$0.50	$0.81	$0.84	Owner earnings / shareOE/sh
$-0.26	$0.37	$0.05	$-0.03	$0.29	$0.50	$0.81	$0.84	Free cash flow / shareFCF/sh
$0.15	$0.06	$0.04	$0.03	$0.01	$0.03	$0.02	$0.03	Cap. spending / shareCapex/sh
$-14.77	$-35.05	$9.48	$3.70	$3.66	$3.78	$3.52	$3.60	Book value / shareBVPS

The diluted share count moved ×1.7 into 2021 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

The diluted share count moved ×2.18 into 2022 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

Per-share growththe realized rate an owner's share compounded

	6-yr	5-yr
Revenue / share	+3.9%/yr	−2.5%/yr
Owner earnings / share	—	+17.1%/yr
Capital spending / share	−29.0%/yr	−19.4%/yr

The record, charted

FY2019–2025

Each measure over its full record; the current point and the worst year marked.

Share count

294Mpeak FY2024

ROIC

3%low FY2021

Gross margin

85%low FY2019

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$237Mowner earningsvs.$184Mnet incomelow FY2019

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2020FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business turned $184M of profit into $237M of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

Reported net income$184M

Owner earnings$237M · 28% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$184M	($95M)	($137M)	($232M)	($192M)
Depreciation & amortizationnon-cash charge added back	+$26M	+$19M	+$12M	+$12M	+$13M
Stock-based compensationreal costnon-cash, but a real cost	+$147M	+$217M	+$211M	+$208M	+$173M
Working capital & othertiming of cash in and out, other non-cash items	−$114M	+$20M	+$763K	+$10M	+$17M
Cash from operations	$242M	$161M	$86M	($3M)	$11M
Capital expenditurecash put back in to keep running and to grow	−$6M	−$9M	−$2M	−$7M	−$6M
Owner earnings	$237M	$151M	$84M	($10M)	$6M
Owner-earnings marginowner earnings ÷ revenue	28%	21%	14%	-2%	2%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $147M), owner earnings is nearer $90M.

Much of fiscal 2025's profit didn't arrive as operating cash; it sits in “working capital & other” above. That can be a real inventory or timing swing, or profit that doesn't run through operating cash at all: a heavy tax year, equity-method earnings, or investment income booked through investing. For a year like this, owner earnings understates the cash earned; the full cash-flow statement carries the rest.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? —

No meaningful interest burden

Little or no interest expense reported

What this means
Little or no interest expense reported, the business isn't leaning on lenders to operate.
How heavy is the debt, net of cash? +$781M

Net cash, debt-free

Cash $570M + ST investments $212M − debt $0

What this means
Cash and short-term investments exceed every dollar of debt by $781M, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 32d

Tight

DSO 66 + DIO 0 − DPO 33 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash. (Little or no inventory, a services / asset-light model, so the inventory leg is ~0.)

Is it a good business?

Return on invested capital —

Not enough data

Industry peers: median -14%

What this means
The filing data didn't include the inputs for this check.
Owner-earnings margin 11%

Solid through the cycle

7-yr median margin, range -8%–28%; latest $237M = operating cash $242M − maintenance capex $6M

Industry peers: median 5%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 28% of revenue this year, a 11% median across 7 years. Treating stock comp as the real expense it is (less $147M of SBC) leaves $90M.
Are earnings backed by cash? 1.32×

Cash-backed

Cash from ops $242M ÷ net income $184M

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 163%

Returned more than it generated

Dividends + buybacks $386M ÷ Owner Earnings $237M

What this means
The company returned more than it generated: against $237M of Owner Earnings, $386M (163%) went back to shareholders, $0 dividends, $386M buybacks — the excess came from the balance sheet or borrowing, not the year's operations. Net of $147M stock comp, the real buyback was about $239M. Sustained, that pattern draws down cash or adds debt; the net-debt line above shows where it stands.
Investing or harvesting? 0.22×

Harvesting

Capex $6M ÷ depreciation $26M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 1 of 4 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Miss

Revenue ≥ $2B · $839M

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 2.20×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Earnings stability Miss

A profit every year (7-yr record) · 6 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth —

Earnings +33% over the record · —

What this means
Earnings were negative early in the record, a growth rate isn't meaningful.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-0.06/share (latest year $0.65), the averaged base the calculator's gate runs on, and book value is $3.64/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2019–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 1 of 7

What this means
Lost money in 6 year(s), look at what happened there before trusting the average.
Operating margin −32% → −15% (3-yr avg ends)

What this means
Through the cycle the operating margin widened — about −32% early to −15% lately, median −22% — pricing power intact or improving.
Owner earnings growth +75%/yr

What this means
Owner earnings grew about 75% a year over the record.
Worst year 2021 · −55.2% op. margin

What this means
Operations went underwater in 2021, understand why before trusting the good years.

Does AI threaten the moat?

Elevated contestability

The product is software or information, the very thing capable AI now produces more cheaply, so the moat is more contestable than the record alone implies.

In its own filing A competitive risk, new this year

Its FY2025 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.

“We also use and build AI offerings into many of our products and we face increased competition as AI technologies are integrated into the various competitive offerings.”

AI has collapsed the cost of building a capable substitute for the very thing this business sells. When a credible alternative can be assembled for a fraction of the incumbent's price, it is pricing power that erodes first, not revenue tomorrow. The live question is whether the moat survives that, not whether it held in the past. Whether that question is answerable at all is yours to decide, against your own circle of competence.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$1.0B

Cash & short-term investments$779M
Receivables$127M
Other current assets$100M

Current liabilities$520M

Accounts payable$19M
Other current liabilities$501M

Current ratio1.94×all current assets ÷ what's due · Graham looked for 2×

Quick ratio1.94×stricter: inventory excluded

Cash ratio1.50×strictest: cash alone against what's due

Working capital$487Mthe cushion left after near-term bills

Revenue, latest quarter vs. a year ago+16.5%the freshest read on whether the business is still growing

Current ratio, recent quarters3.3× → 1.9×

Deeper floors

Tangible book value$723Mequity stripped of goodwill & intangibles

Net current asset value$421MGraham's net-net: current assets less all liabilities

Debt incl. operating leases$39M$39M of it operating leases

Deferred revenue$395Mcustomer cash collected before delivery; operating float

From the company's latest filing.

How the cash was used, 2019–2025

Over the record, the business generated $522M of operating cash; how management split it reads as a cash returner, paying most of what it earns straight back to owners.

Reinvested$46M · 9%
Buybacks$400M · 77%
Retained (debt / cash)$77M · 15%

Returned to owners$400M
83% of the owner earnings the business produced over the span, $0 as dividends and $400M as buybacks.
Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span cash and short-term investments rose $704M.
Average price paid for buybacks$13.90
Across the years where the filing reports a share count, 1M shares were bought for $14M, about $13.90 each.
Net change in share count272.7%
The diluted count rose from 76M to 283M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	—	$234.0M	$241.5M	$6M
2022	—	$517k	−$96.7M	($10M)
2023	—	$962k	$47.1M	$84M
2024	Mr. Woodside	$15.0M	−$11.6M	$151M
2024	—	$18.9M	−$61.3M	$151M
2025	Mr. Woodside	$15.6M	$8.3M	$237M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years. A dash under the name means the filing tags the figure without naming the officer.

Insider ownership3.5%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio354:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$147M
The slice of the business handed to employees in shares this year, 18% of revenue, equal to 1112% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

What an owner would ask, FY2025

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition, Income taxes, Stock compensation as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Software

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
YOUClear Secure Inc.	$901M	—	-8.2%	52%	33%
WKWorkiva	$885M	75%	-15.1%	-18%	9%
RPDRapid7	$860M	70%	-17.1%	-18%	6%
CXMSprinklr Inc.	$857M	70%	-6.6%	-3%	5%
FRSHFreshworks Inc.	$839M	81%	-22.5%	-23%	11%
QTWOQ2 Holdings Inc.	$795M	48%	-14.8%	-10%	0%
ASANAsana	$791M	89%	-68.9%	-177%	-27%
COURCoursera Inc.	$758M	53%	-22.9%	—	0%
Group median	—	70%	-16.1%	-18%	6%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Freshworks Inc. has delivered.

Freshworks Inc.’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Through the cycle, Freshworks Inc. earns about $95M on its 11.3% median owner-earnings margin. This year’s 28.2% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.

Base Normalize · through-cycle ($95M) Net of stock comp (−$139M) Steady-state · maintenance capex ($241M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’19→’25+89%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow $238M on 283M shares outstanding (a weighted basic average, the only count this filer tags); net cash $779M. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. Capex ($8M) runs well above depreciation ($27M), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $241M, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh FRSH against another business →

The owners of FRSH: the meeting and the votes →

Cite: Owner Scorecard, "Freshworks Inc. (FRSH), the owner's record," https://ownerscorecard.com/c/FRSH, data as of 2026-07-09.

Manual order: ← FRPT its page in the Manual FRST →

Industry order: ← FROG the Software chapter FSLY →