Freshworks Shares Plunge 4.97% to Record Low Amid GAAP Losses Mixed Insider Sales

The share price dropped to a record low today, with an intraday decline of 4.97%.

Despite reporting Q3 adjusted earnings per share of $0.16 and revenue of $215.12 million—both above estimates—Freshworks has seen its stock fall 32.5% year-to-date, lagging the S&P 500’s 15.1% gain. The company raised full-year revenue guidance for the third time to $833.1–$836.1 million, reflecting confidence in its customer engagement solutions. Analysts maintain a “Buy” average rating, with a median 12-month price target of $19.00, a 42.5% premium to the recent close. However, GAAP losses of $4.68 million and mixed insider sales highlight ongoing challenges. While non-GAAP operating margins improved to -3.5% from -20.8% year-over-year, the company’s unprofitability and high price-to-sales ratio remain concerns.

Operating in a resilient SaaS sector, Freshworks holds $813.2 million in cash, offering flexibility for growth. The company added 9% more high-value customers year-over-year, now totaling 24,377, indicating demand for its solutions. Yet, its unprofitability, as shown by a -2.56% return on equity, and competition from peers like Salesforce and Zendesk, pose risks. Institutional ownership at 75.58% underscores long-term confidence, but short-term volatility remains as investors weigh near-term execution against broader market dynamics.